By Jeff Overley

Law360 (April 29, 2020, 6:08 PM EDT) -- In this edition of Coronavirus Q&A, McDermott Will & Emery LLP's health practice chair discusses how the needs of health care providers are evolving during COVID-19, how lobbying has changed amid the crisis and why lawmakers may be having second thoughts about Medicaid reimbursement changes that conservatives have championed in recent years.

Eric Zimmerman, a Washington, D.C.-based partner, quarterbacks McDermott's health care practice and is a principal at the firm's lobbying arm, McDermott+Consulting. He shared his perspective as part of a series of interviews Law360 is conducting with practice chairs about wide-ranging legal work and business challenges during the world-changing coronavirus saga.

This interview has been edited for length and clarity.

To start, tell me about your clients and their top needs during the crisis.

We're working with the entire spectrum of health care stakeholders, really everybody within the industry. Providers to be sure, payers as well, but also a lot of the big diagnostics makers that have been trying to develop both the test kits and the serologic tests.

Over the five or six weeks that we have been really in the heart of the coronavirus response, I have seen a cycle in the nature of questions coming from our clients, including provider clients.

Initially, the focus was very much on, "How do we scale up rapidly to meet the anticipated demand for the coronavirus response?" And a lot of that was about, "Where do we get the supplies? How do we get the major equipment that we're going to need? How can we add capacity? Can we get flexibilities from federal, state and local governments in order to do all of these things? What kind of capacity can we clear out of the hospital in terms of patients who are presently utilizing the hospital? How can we continue to deliver services to patients who are going to need services, but not on an emergency basis, via telehealth?"

So that was kind of the first wave of questions. Then, in the next wave that we're in now, most providers have largely achieved that scale; there are definitely still some gaps, there's definitely still a lot of need, but they've achieved that scale, and some of them are in the meat of the response, and others are awaiting a wave of cases to come in.

And then some other providers, where they're maybe not expecting so much of a wave, are starting to look to what I think will be the next cycle, which is, "How can we resume some normal course of business? Can we start taking in some quote-unquote elective cases? Can we start furnishing services again?"

Are there changes in business operations that might endure after the crisis eases up?

Yes. Right now, providers are definitely asking the question of, "When can we return to normal?" And they're also asking the question of, "What is the new normal?" And I think in many respects, the new normal is going be different than the old normal, and it's still very much evolving.

For that, I look back as an analogue to Sept. 11, where there was a way of going about life beforehand, and then there was a way of going about life afterward. Things that we accept now in terms of processes at airports are just very different than they ever were before.

That's a tangible example for people. And I think that's going to be true in the way that hospitals and physicians and others deliver health care. There probably will be more interest in furnishing services remotely via telehealth. There will be different patient-flow processes as patients are coming in and out of health care environments. There's probably going to be a different level of expectation around PPE [personal protective equipment], both for providers as well as for patients. And I don't have a crystal ball to know where things are going to change and how much, but I do know that we're in for a lot of change.

What exactly do you mean by different processes for patients coming in — steps to screen them for the coronavirus?

It could be those things. It could be distancing in terms of waiting areas. It could be tighter schedules — a one-in, one-out kind of thing. It could be just traffic flows within the spaces so that patients don't encounter as many people along the way. It certainly could be how we clean rooms in between cases. And these things could affect efficiencies, which are very relevant.

How has the need to work remotely affected the lobbying portion of your practice?

Everybody is in this position, so there is a universal sensitivity to operating in a different way — people are interacting by phone and by Zoom videos to keep objectives moving forward.

But nothing replaces face-to-face in terms of effectiveness, and one element that is just sorely missing from the environment we're in is the chance encounter. Bumping into somebody on the street, or in a hallway someplace, and having productive dialogue with somebody through a chance encounter.

What are the top questions or issues that lawmakers and regulators need to address?

From the regulatory front, I think [the U.S. Department of Health and Human Services] and its various agencies have done a very good job of acting quickly to afford providers the kinds of flexibilities they need to do things differently and to meet current demand. The waivers that came out of [the Centers for Medicare & Medicaid Services] in late March really were rapid and mostly clear and mostly accommodating. And so compliments are due to the administration for that. And likewise to Congress for acting very quickly and providing financial support to the health care community.

But I think you'll find that those [actions] are not enough. Neither the flexibility nor the funding that's coming in — we don't yet know how short those are going to [come up], because we don't know how long this is going to go on. We don't know what the overall impact through the health care system is going to be and what the economic impact of all of that will be.

The government has responded pretty quickly in getting money out the door to shore up the health care system, but more is absolutely going to be needed. And that's what everybody is looking toward right now: What is the next day going to look like? When is HHS going to distribute more of the Provider Relief Fund, and what is that going to look like?

There's been a lot of talk about financial distress that state governments are facing — to what extent should providers be concerned about that?

The most apparent impact for state budgets is going to be Medicaid budgets and how able they are to sustain those going forward, particularly if they have the unholy combination of declining tax revenues, increasing patients on Medicaid and if a substantial percentage of that population gets sick and has very expensive treatment.

It reminds me a little bit of how every now and again we have a debate in Congress over block granting the Medicaid program. And for any state that thinks about block granting and finds that attractive, this is the nightmare scenario that gives them pause. Because under a block grant, you're given a certain amount of money and forced to make due with that amount of money.

And that might work fine under normal, predictable circumstances. It doesn't work so fine in circumstances like this, where you have a huge economic downturn with more and more patients, your own Medicaid numbers swelling and your tax revenue base diminishing.

So might this be a setback for advocates of block granting?

That's a good question. I don't know if it's a setback, but it will certainly be a real-life example for a lot of state governors as to what the risk profile of block grants looks like.

--Editing by Aaron Pelc.

Check out Law360's previous installments of Coronavirus Q&A.

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