1The Legal Framework for COVID‑19 Recovery

The uncertainty in dealing with an invisible enemy underscores the need to re-empower officials at each level of responsibility, to allow officials to adapt as facts and science become clearer, and to abandon utopian assumptions of treating everyone the same.

Lines of authority. Recovering from the COVID-19 shutdown will require a hybrid governing structure. Decisions on social protocols and reopening should generally be made by state and local authorities. The federal government should take the lead on science, should fund costs associated with recovery, and should retain preemptive authority to overrule state and local decisions that it believes will involve unnecessary risks or harm to citizens of other states.

Tracking the virus and funding the cure. Until there is a vaccine, the key to making sensible reopening choices is information. Discovering and disseminating this information requires federal funding and coordination, and new protocols on privacy:

i) Increasing testing capacity is critical to know who is infected. Washington should fund universal testing, which should then be implemented at the state and local levels.

ii) Tracing is important to identify who has been exposed. Application software and other protocols should be used by state and local governments to track down exposed citizens. Federal and state privacy laws may inhibit or prevent practical tracing technology and activities. These provisions should be waived for the duration of the pandemic, perhaps under the guidance from a Recovery Authority.

iii) The medical science is still developing on transmission, treatments, immunity, risks of different populations, and protective protocols. The federal government should fund that science and disseminate immediately all credible scientific information.

iv) When a vaccine is available, the federal government should make it universally available.

Avoiding unnecessary regulatory hurdles. Recovery authorities or some other mechanisms should be created at federal and state levels to suspend existing regulatory requirements when they preclude choices in the public interest. Certain long-standing legal prohibitions, such as barring “telemedicine” out of fear of possible privacy violations or billing errors, now look medieval. Federal dictates and entitlements for schools should be replaced by goals-oriented principles that give broad flexibility to schools. Many state restrictions, including those on licensing and scope of practice, should also be waived.

Avoiding litigation paralysis. Because every choice on reopening will involve risks and tradeoffs, liability concerns could significantly impede recovery. Decisions to reopen are already dampened by the need to operate many businesses at partial capacity in order to achieve social distancing. The inevitability that employees, visitors, and patrons will get sick, and that some will die, potentially creates crippling exposure, with no mechanism for an employer to disprove its culpability. On the other hand, it is also important for employers to have incentives to be prudent. Similar concerns will impact organizations that serve the public. It is vital for reopening to create a predictable framework for COVID liability. We recommend this two-pronged approach:

i) The federal government should create a workers’ compensation framework, to be administered by states, in which all employees who contract COVID shall receive healthcare and wages. The federal government should fund 90% of the cost, leaving employers an incentive to maintain safe COVID practices. No lawsuits shall be permitted except with specific, credible allegations of intentional misconduct by an employer.

ii) For all other claims of injury from COVID, the federal government should provide a national standard for liability: Intentional misconduct or reckless disregard of prudent practices. To insure reliable enforcement of this standard, Congress should create a special administrative pandemic court to adjudicate injury claims involving COVID, including against healthcare providers, retailers, schools, and others. Creating a clear standard for liability and a special administrative court will achieve the reliability needed to avoid chilling recovery. It will also avoid clogging regular courts with COVID claims.