Although passed into law 15 years ago, the Public Readiness and Emergency Preparedness Act (PREP Act) resulted in fairly limited litigation – that is, until this past year.
The PREP Act was enacted to shield drug makers from liability when bringing vaccines to market during a public health emergency.
With the recent focus on the rapid development of COVID-19 testing, mitigation, and vaccine strategies, the PREP Act has taken on new relevance since the onset of the COVID-19 pandemic, and as such, given rise to a slew of class-action lawsuits, many targeting long-term care facilities and nursing homes.
PREP Act Overview
The PREP Act authorizes the U.S. Secretary of the Department of Health and Human Services (HHS) to issue a declaration that provides immunity to “covered persons” from liability (except for willful misconduct) for claims of loss caused, arising out of, relating to, or resulting from administration or use of “covered countermeasures” to diseases, threats and conditions determined by the secretary to constitute a present or credible risk of a future public health emergency.
HHS issued a PREP Act declaration on March 17, 2020, in response to the COVID-19 pandemic, which has been updated several times as noted below.
Individuals who suffer injuries as the direct result of a countermeasure administered or used under a PREP Act declaration are not completely without a remedy. An individual seriously injured or killed by the administration of a covered countermeasure, whether or not as a result of willful misconduct, may seek compensation through the Countermeasures Injury Compensation Program (CICP). CICP is funded through congressional appropriation, and is administered by HHS’s Health Resource and Services Administration.
The PREP Act is incredibly nuanced and fact-specific. As such, this article is intended to provide a general overview of the PREP Act and its immunity protection. A detailed analysis for alignment with PREP Act requirements is recommended to ensure the availability of immunity.
The PREP Act confers immunity to entities and individuals involved in the development, manufacture, testing, distribution, administration, and use of covered countermeasures.
[c]laims that courts must dismiss include claims for any loss that is related to any stage of design, development, testing, manufacture, labeling, distribution, formulation, labeling, packaging, marketing, promotion, sale, purchase, donation, dispensing, prescribing, administration, licensing or use of a countermeasure recommended in a Declaration.
The PREP Act also covers “program planners,” that is, individuals and entities involved in planning, administering, or supervising programs for distribution of a countermeasure, e.g., state, local, and tribal governments or private-sector employers or community groups that establish requirements or provide guidance, technical or scientific advice or assistance, or provide a facility.
Notably, PREP Act immunity may also extend to other qualified persons who prescribe, administer, or dispense countermeasures such as licensed health professionals and others named in a PREP Act declaration (such as volunteers).
PREP Act addresses certain “countermeasures” that would be deployed to combat a public health challenge. Each kind of countermeasure is explicitly defined within the law and subject to satisfaction of certain requirements, but in general, the PREP Act covers:
- a qualified pandemic or epidemic product;
- a security countermeasure;
- an unapproved drug, biological product, or device used under an Emergency Use Authorization (EUA) issued by FDA;
- an approved drug, biological product, or device used pursuant to Federal law in conditions that are inconsistent with its approval; or
- an unapproved drug, biological product, or device, or an approved drug, biological product, or device intended for an unapproved use, that is intended for emergency use and shipped and held by a government agency or someone working on that agency’s behalf for use only when that use is authorized.
HHS has amended its initial March 17, 2020, declaration on six occasions, each time expanding the liability protection afforded under PREP Act.
On April 5, 2020, the secretary issued the first amendment to the declaration to extend liability immunity to covered countermeasures authorized under the newly passed CARES Act.
On June 8, 2020, the second amendment was made to clarify that covered countermeasures under the declaration include qualified countermeasures that limit the harm COVID-19 might otherwise cause.
On Aug. 24, 2020, the third amendment identified state-licensed pharmacists (and pharmacy interns acting under their supervision) as an additional category of qualified persons under the PREP Act.
On Dec. 3, 2020, in the fourth amendment, HHS expanded PREP Act liability protection to:
The fifth and sixth amendments (dated Feb. 2, 2021, and Feb. 16, 2021, respectively) further expanded the workforce of covered persons for purposes of the PREP Act.
COVID-19 PREP Act Litigation
Nursing homes have been the primary source of PREP Act litigation. The cases below, as well as a slew of subsequent cases, follow similar fact patterns: long-term care facilities defending class actions asserting claims of negligence, medical malpractice, and wrongful death.
In Estate of Maglioli v. Andover Subacute Rehab. Center,1 family members of deceased nursing home residents filed a class-action lawsuit against the nursing home and related parties in New Jersey Superior Court. In support of their negligence and wrongful death claims, the plaintiffs accused the nursing home of failing to have (or implement) proper protocols or provide personal protective equipment to prevent the spread of COVID-19.
Soon thereafter, the nursing home filed a notice to remove the case from New Jersey state court to federal court on the grounds that the PREP Act preempted the lawsuit. Specifically, the nursing home argued that the PREP Act provides liability protections for the use of pandemic and epidemic products, including face masks, and therefore covers the claims alleged in the complaint. In response, the plaintiffs moved for remand, arguing that their claims did not fall within the scope of the PREP Act.
The court granted the plaintiff’s motion for remand, finding that the state law claims were not preempted by the PREP Act. The federal court conceded that the PREP Act generally affords immunity to defendants for injuries caused by the administration of countermeasures.
However, the court concluded that the plaintiff’s injuries were not caused by administration of countermeasures – rather, the injuries were allegedly caused by the failure of administrating such countermeasures. In other words, the court held that a negligence claim about countermeasures not used “would not be preempted by the PREP Act, which is designed to protect those who employ countermeasures, not those who decline to employ them.”
Baskin v. Big Blue Healthcare, Inc.,2 provides similar facts – where family members of a deceased resident sued the decedent’s nursing home. The family members alleged that the defendants were negligent in failing to protect against COVID-19 infections.
In support of their claim, the plaintiffs alleged (among other things) that defendants failed to follow proper infection control protocols and guidelines, ensure workers were not working with COVID-19 symptoms, provide personal protective equipment to staff, and adhere to social-distancing guidelines.
In response, defendants removed the case to federal court, arguing the PREP Act provided “complete preemption” and presented a federal question. Plaintiffs moved for remand, arguing the allegations arose solely under state law and the PREP Act did not apply.
The court granted the motion for remand. In so holding, the plaintiffs in this case alleged that the residents died of COVID-19 because defendants failed to take preventative measures to stop the entry and spread of the disease. Further, the complaints did not allege that the decedents’ deaths were causally connected to the administration or use of any covered countermeasures – i.e., drugs, biological products, or devices.
Like Estate of Maglioli, the court in Baskin found that the PREP Act is designed to protect action, not inaction, which is what the complaints alleged. As a result, the defendants’ failure to act did not afford it immunity under the PREP Act.
Responses to Early COVID-19 Lawsuits
The Office of General Counsel (OGC) at HHS has issued six advisory opinions (Advisory Opinions) related to the scope of the PREP Act declaration.
In direct response to the litigation above, the Jan. 8, 2021, Advisory Opinion stated that the the PREP Act “is a complete preemption statute” and that the secretary’s determination that the Act implicates a “substantial” federal question. Further, the OGC opined that the phrase “relating to” the administration of a covered countermeasure should be read broadly to include non-use and inaction. In other words, the OGC argued that prioritization of countermeasures for certain individuals at the expense of others can fall within the PREP Act and the declaration’s liability protections.
The Advisory Opinions do not have the force or effect of law. However, the fourth amendment to the PREP Act declaration made clear that the secretary’s declaration was to be construed in accordance with these Advisory Opinions.
Further, the fourth amendment clarified that inaction was not necessarily beyond the scope of PREP Act immunity. In particular, the secretary noted that a covered person may still avail themselves of PREP Act protection, “[w]here there are limited Covered Countermeasures, not administering a Covered Countermeasure to one individual in order to administer it to another individual can constitute ‘relating to … the administration to … an individual,’” under the PREP Act.
Nevertheless, the recent guidance has not persuaded most federal courts. The overwhelming consensus among federal courts remains that the PREP Act is not a complete preemption statute. In other words, claims of negligence and wrongful death for failing to protect nursing home residents (like the cases mentioned above) are not properly characterized as federal law claims under the PREP Act.
To date, the only exception is Garcia v. Welltower OpCo Grp.3 In Garcia, the District Court for the Central District of California found the Advisory Opinion persuasive, and concluded that the PREP Act was a complete preemption statute. Garcia seems to be an outlier, and recent cases have disagreed with its holding.4
What This Means for You
Recent nursing home lawsuits show hesitancy to provide immunity to facilities who fail to administer covered countermeasures – even considering the Advisory Opinions.
Based on these decisions, courts will scrutinize the connection between the administration of countermeasures and the alleged injury. Where the alleged injury is caused by omission of countermeasures, nursing homes may lose PREP Act immunity, or, at the very least, lose the ability to remove such cases to federal court.
In short, the PREP Act still requires a causal connection between the injury and the use or administration of covered countermeasures, and that link was not present in Estate of Maglioli or Baskin.
From a practical perspective, providers and other persons who reasonably believe they are covered by the PREP Act are encouraged to maintain records and documentation to support their legal analysis. HHS has stated that PREP Act immunity may be construed broadly, and may even be available in situations where a person has a reasonable belief that it is covered.
Similarly, providers and other persons should implement and document the reasonable precautions undertaken to facilitate the safe use or administration of covered countermeasures.
Conclusion: Diligence and Understanding Required
The PREP Act is a powerful tool for the health care industry, allowing it to fulfill its mission to provide care to patients without fearing COVID-19-related legal liability that, if left unchecked, could be enterprise-threatening.
However, accessing the immunity conferred by PREP Act requires diligence and a thorough understanding of how the PREP Act provides protection for covered persons.
The safest course is to seek the advice of knowledgeable legal counsel in order to implement procedures and processes that are compliant with the law long before litigation erupts.
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This article was originally published on the State Bar of Wisconsin’s Health Law Blog. Visit the State Bar sections or the Health Law Section web pages to learn more about the benefits of section membership.
Stephen J. Veit, George Mason 2017, is an attorney with Husch Blackwell LLP in Milwaukee. He concentrates on health care law, handling day-to-day regulatory compliance and transactions for a wide range of industry clients.
1 Estate of Maglioli v. Andover Subacute Rehab. Center, 2020 WL 4671091 (D.N.J. 2020)
2 Baskin v. Big Blue Healthcare, Inc., 2020 WL 4815074 (D. Kan. Aug. 19, 2020). Baskin is one of twelve related cases issued by the United States District Court for the District of Kansas.
3 Welltower OpCo Grp., No. 20-CV-2250 (C.D. Cal. Nov. 27, 2020).
4 Dupervil v. All. Health Operations, LCC, No. 20CV4042PKCPK, 2021 WL 355137, at *10 (E.D.N.Y. Feb. 2, 2021) (“this Court respectfully disagrees and concludes that the Advisory Opinion is unpersuasive and not entitled to any deference”).