Apple uses Bluetooth to exchange anonymous identifiers when two people are in close proximity to one another. If a person has tested positive for Covid-19, their iPhone can share a list of everyone they've been in contact with to the cloud. When the other person's iPhone downloads a list of everyone who has tested positive for the disease in the area, they will be informed of any positive cases around them and prompted to inform health authorities.
The new version of iOS also features an update to Face ID. Now, Face ID recognizes when someone is wearing a mask — as it has become an essential item — and immediately switches over to the passcode screen, speeding up the unlock process significantly. Face ID itself still won't work until a mask is removed, however.
Reports suggest iOS 13.5 and iPadOS 13.5 GM could release to the public as early as this week.