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Vaccine Development And Distribution: Legal Considerations For US Healthcare Providers and Other Employers

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Author: Morgan Lewis
Published: January 29th  2021
Original Article Link

The following article is courtesy of CGCC
member Morgan Lewis. This following article does not, and is not intended to
constitute legal advice.

As the United States races to deliver safe and effective
coronavirus (COVID-19) vaccines under the Biden administration, employers,
healthcare providers, and many others are assessing what it means for their
industries and organizations. It is difficult to capture the fast-moving
developments around the vaccines and the issues and opportunities they raise in
real time, but here we outline a selection of key legal considerations and
updates as the rollout continues to take shape. They include the status of the
US Food and Drug Administration’s (FDA’s) vaccine products, distribution, key
legal issues at the state level, employer mandates and employee incentives, and
important liability concerns.

CURRENT VACCINES AND FDA APPROVAL

  • Under new leadership, FDA will need
    to continue to assess new vaccines and new vaccine dosing regimens based
    on science and data, but also within the context of evolving public health
    realities like vaccine reluctance, demand for access, and geographic
    disparities in vaccine implementation resources.
  • As the demand for prompt access to
    vaccines continues to build in the general population, there will be increased
    stress on the vaccine supply chain (syringes, wipes, packaging, coolant,
    storage) and on vaccine manufacturing capacity, which could prompt
    increased federal government intervention.
  • The science and research and
    development around COVID-19 vaccines will continue for many years beyond
    the initial contingent of vaccines, with resources directed to efficacy
    generally and against new variants, duration of response, second
    generation products in different delivery systems, and new and more
    cost-effective manufacturing technologies.

VACCINES DISTRIBUTION

  • The biggest issue is still that
    demand for the vaccinations exceeds supply.
  • The implementation of phased
    distribution recommendations from the Centers for Disease Control and
    Prevention’s Advisory Committee on Immunization Practices (ACIP) varies by
    jurisdiction, causing disparity among phases and some confusion.
  • A workforce capacity issue in
    administration may arise as the same healthcare organizations that are
    caring for COVID-19 patients are being used as vaccination hubs while new
    hubs and community centers are being conceived.
  • States are organizing distribution
    of vaccine through differing centralized teams requiring knowledge of each
    states’ processes and whether there is also a delegation to local health
    departments.
  • Through an Executive Order (EO)
    signed on January 20 the Biden administration intends to direct the
    Federal Emergency Management Agency with respect to dollars and personnel
    to create 100 community vaccination centers and pharmacy programs for the
    public. There is also a directive in the EO to ignite the public health
    service corps to expand the workforce to administer the vaccines.

EMPLOYER VACCINE MANDATES – FEDERAL
CONSIDERATIONS

  • According to the Equal Employment
    Opportunity Commission (EEOC), a mandatory vaccination policy may be
    lawful under the Americans with Disabilities Act (ADA) and Title VII,
    provided that available reasonable accommodations are made for individuals
    with disabilities and those with sincerely held religious beliefs,
    practices, or observances; however, depending on the nature of an
    employer’s business, a host of practical issues must be considered before
    imposing a mandatory vaccine program, such as impact to employee morale
    and employee turnover.
  • Prior to excluding an employee who
    cannot receive the vaccine due to his or her disability from the
    workplace, the EEOC advises that an employer must demonstrate that the
    unvaccinated individual will expose others to the virus at the worksite
    and that no reasonable accommodation (absent undue hardship) exists that
    would eliminate or reduce the risk of the unvaccinated employee posing a
    direct threat.
  • Employers must engage in the
    interactive process to evaluate whether there are any reasonable
    accommodations (such as additional protective gear or moving an employee’s
    workstation) that would eliminate or reduce the risk of the employee
    posing a direct threat.
  • Mandatory vaccination programs
    should be undertaken with caution, given the lack of concrete substantive law
    (the EEOC’s guidance is simply guidance), state laws with different
    requirements, and the dearth of information regarding the safety of having
    some unvaccinated employees in the workforce.

EMPLOYER VACCINES MANDATES – STATE AND
LOCAL CONSIDERATIONS

  • Long before the COVID-19 pandemic
    occurred, varying state laws have addressed whether vaccines can be
    mandated and, in a parallel fashion, registries can be used by public
    health officials to see the coverage of vaccinations in each state.
  • The issues of religious or
    conscientious exemption differ among the states and in some cases, the
    conscientious exemptions can create such a hole that anyone can object to
    receiving a vaccination.
  • A broad federal regulation was
    published under the Trump administration to protect statutory conscience
    rights in healthcare that extends to vaccination. It has been temporarily
    restrained in two courts but would have to be rescinded in some form or
    fashion to be removed from the federal overlay in addition to state laws.
  • So far, three states have proposed
    laws regarding mandates: New York, New Jersey, and Tennessee.

EMPLOYER VACCINES INCENTIVES

  • The legal issues surrounding what
    employers can do to incentivize employee vaccinations are complicated, and
    guidance from the EEOC is sorely needed.
  • For now, the safest approach for
    employers who wish to provide vaccines on site or by a vendor and
    incentivize vaccination is to provide only modest incentives, such as a
    water bottle or a gift card of modest value.
  • If an employer wishes to provide
    higher incentives, there is less legal risk if the vaccine is provided by
    an unaffiliated third party, such as a local public health agency or
    pharmacy.
  • With vaccine incentives in
    particular, consider careful messaging to employees to mitigate ER
    complaints and confusion.
  • Consistency is key, but
    differentiation in incentives is permitted where it is based on bona fide
    business reasons, such as offering incentives just to employees with
    public/customer contact.

WAGE AND HOUR CONCERNS

  • An employer that provides an
    incentive which is not tied to hours worked does not need to include the
    value of the incentive in the employee’s regular rate calculation.
  • If the decision to get vaccinated
    is truly voluntary, employers do not need to provide pay for the time an
    employee spends getting vaccinated (though many will to encourage
    vaccination).
  • Whether a vaccine is mandatory,
    incentivized, or purely voluntary, employers can ask for proof of
    vaccination. However, questions about why an employee was not vaccinated
    can only be asked where they are job-related and consistent with business
    necessity.
  • Employers with a mandatory vaccine
    requirement for new hires can refuse employment for those who have not
    received a vaccine. But they need to provide accommodations to those who
    did not get vaccinated due to disability or religious needs. 
  • State and local guidance generally
    is not premised on vaccinations and does not sunset for vaccinated
    employees, especially given the possibility of transmission for vaccinated
    workers.
  • Potential liability exists if
    employers rely only on vaccines to prevent the spread of COVID-19 and
    remove other workplace safety measures.

LIABILITY PROTECTIONS FOR EMPLOYERS

  • Two bodies of statuary law provide
    potential routes for liability protection for employers from claims by
    employees relating to vaccination: workers’ compensation coverage and the
    Public Readiness and Emergency Preparedness (PREP) Act.
  • Workers’ compensation coverage is
    dependent on state law and whether vaccination is mandated by the
    employer. If the vaccine is mandated by employers, employees’ liability
    claims would be compensable under workers’ compensation in most states.
  • The vaccines that are available now
    are under emergency use authorization (EUA) and the workers’ compensation
    bar may not apply if it is determined that use of a vaccine that was under
    an EUA constituted gross negligence or reckless conduct.
  • The PREP Act, which the US
    Department of Health and Human Services declared would apply to the
    COVID-19 pandemic, is the federal statue for pandemics and potentially
    provides very broad protection from liability for covered countermeasures
    such as a COVID-19 vaccine. If it applies, the PREP Act provides immunity
    from liability for claims of personal injury or monetary loss.
  • A detailed analysis of four factors
    must be done to determine if the PREP Act will provide protection: Is it a
    covered countermeasure? Does it fit within the definition of a recommended
    activity? Are you within the definition of a covered person? Do you fit
    within the limitations on distribution for the PREP Act?
  • With respect to private employer
    vaccination programs, a closed point of dispensing (POD) COVID-19
    vaccination program operated and administered by an employer for employees
    can be structured in a way that will provide the benefit of PREP Act
    liability protection.

These insights and more were shared during Morgan Lewis’  “COVID-19
Vaccines: Legal Considerations in Light of Latest Developments
” webinar
on January 21, 2021. Visit the
Navigating the NEXT page for more COVID-19 news and thought leadership
.

For any questions regarding this resource,
kindly contact David Fendig (david.fendig@morganlewis.com)