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Economic Relief for Practices Impacted by Coronavirus

The following information is subject to frequent change as new action is taken by Congress and new guidance is issued by the Administration.  ASA will provide updates as they become available.  Please check back regularly.

HHS Provider Relief Fund

The CARES Act includes $100 billion for the Public Health and Social Services Emergency Fund for eligible health care providers for health care-related expenses or lost revenues associated with COVID-19. Providers eligible for this fund include public entities, Medicare or Medicaid enrolled suppliers and providers, for-profit entities and nonprofit entities in the United States that provide diagnoses, testing or care for individuals with possible or actual cases of COVID-19. Check the HHS website for regular updates on the Provider Relief Fund.

October 1 Update: $20 Billion in New Phase 3 Provider Relief Funding

HHS has announced $20 billion in new funding for providers on the frontlines of the coronavirus pandemic. Under this Phase 3 General Distribution allocation, providers that have already received Provider Relief Fund payments will be invited to apply for additional funding that considers financial losses and changes in operating expenses caused by the coronavirus. Previously ineligible providers, such as those who began practicing in 2020, will also be invited to apply, and an expanded group of behavioral health providers confronting the emergence of increased mental health and substance use issues exacerbated by the pandemic will also be eligible for relief payments. The application process opens October 5, 2020.

HHS has already issued over $100 billion in relief funding to providers through prior distributions. Still, HHS recognizes that many providers continue to struggle financially from COVID-19’s impact. For eligible providers, the new Phase 3 General Distribution is designed to balance an equitable payment of 2 percent of annual revenue from patient care for all applicants plus an add-on payment to account for revenue losses and expenses attributable to COVID-19. 

More Information on the HHS Provider Relief Fund

HHS Provider Relief Funds for Medicaid and CHIP Providers

The U.S. Department of Health and Human Services (HHS) announced the distribution of additional funds for the Provider Relief Fund (PRF) to eligible Medicaid and Children’s Health Insurance Program (CHIP) providers. HHS expects $15 billion will be distributed to eligible providers who have not yet received a payment from the Provider Relief Fund General Allocation along with $10 billion in Provider Relief Funds to safety net hospitals that serve the nation’s most vulnerable citizens.

The enhanced Provider Relief Fund Payment Portal for Medicaid and CHIP providers to apply for the funding is now open.

The portal will allow eligible providers who participate in Medicaid and CHIP to report their annual patient revenue. The information will be used as a factor in determining their Provider Relief Fund payment and will be at least 2 percent of reported gross revenue from patient care.

Visit the HHS website to learn more about eligibility and the application process.

What expenses qualify for funding?

All non-reimbursable expenses attributable to Covid-19 qualify for funding. Examples include building or retrofitting new ICUs, increased staffing or training, personal protective equipment, the building of temporary structures and more. Forgone revenue from cancelled procedures, which has put significant strain on the health care system, is also a qualified expense. It is important to note that this fund can only be used for non-reimbursable expenses. Any expenses reimbursed or obligated to be reimbursed by insurance or other mechanisms are not eligible. The bill instructs the Secretary to establish a reconciliation process under which payments will have to be returned to the fund if other sources provide reimbursement for expenses.

ASA strongly encourages physicians and practices to document all losses resulting from the COVID-19 pandemic.

Physicians who believe they should have received funds but did not, or have questions about their eligibility can contact UnitedHealth Group’s Provider Relations at (866) 569-3522.

As of April 16, the portal for physicians and other providers to attest to the Terms and Conditions has opened, accessible with the specific provider information, such as a TIN.  Providers have 30 days from receipt of the payment to submit their attestation.

Additional Details:

Congress directs the Secretary to make payments on a rolling basis and the Secretary has flexibility to make advance payments or reimbursements. Recipients of these funds must comply with documentation requirements established by the Secretary, and the Secretary must provide reports to Congress every 60 days detailing the payments made.

Terms and Conditions

Medicare providers for whom HHS did not have adequate cost report data on file will need to submit their revenue information to the General Distribution Portal   to be able to receive additional general distribution funds and agree to the Terms and Conditions for this additional distribution. Providers who received their additional money automatically will still need to submit their revenue information so that it can be verified via the portal. 

FAQs on the General Distribution Portal - PDF

Financial Relief for Medicare Providers: Accelerated & Advance Payments Program

It is important to note, this funding is separate from the $100 billion provided in the CARES Act.
 
Update: In light of the $175 billion recently appropriated for healthcare provider relief payments, on April 26, 2020 the Centers for Medicare & Medicaid Services (CMS) announced that it is reevaluating the amounts that will be paid under its Accelerated Payment Program and suspending its Advance Payment Program to Part B suppliers effective immediately.
 
Beginning on April 26, 2020 CMS will not be accepting any new applications for the Advance Payment Program, and CMS will be reevaluating all pending and new applications for Accelerated Payments in light of historical direct payments made available through HHS’s Provider Relief Fund. Significant additional funding will continue to be available to hospitals and other healthcare providers through other programs.
 
The Centers for Medicare & Medicaid Services (CMS) announced expansion of its accelerated and advance payment program for Medicare participating health care providers and suppliers, to ensure they have the resources needed to combat the 2019 Novel Coronavirus (COVID-19). The payments can be requested by hospitals, doctors, durable medical equipment suppliers and other Medicare Part A and Part B providers and suppliers.
 
To qualify for accelerated or advance payments, the provider or supplier must:
  • Have billed Medicare for claims within 180 days immediately prior to the date of signature on the provider’s/ supplier’s request form,
  • Not be in bankruptcy,
  • Not be under active medical review or program integrity investigation, and
  • Not have any outstanding delinquent Medicare overpayments.
CMS Factsheet 

Main Street Lending Program 

Update: April 30: The Federal Reserve is currently working to create the infrastructure necessary to operationalize this program. More information will be posted on the Federal Reserve’s website as it becomes available.

The Program will operate through three facilities: the Main Street New Loan Facility (MSNLF), the Main Street Priority Loan Facility (MSPLF), and the Main Street Expanded Loan Facility (MSELF). Term sheets for each facility and Frequently Asked Questions (FAQs) providing more information regarding eligibility and conditions can be found here.

Using funds appropriated under the CARES Act, Treasury will make a $75 billion equity investment in a special purpose vehicle established to implement the Main Street Business Lending Program. This investment will enable up to $600 billion in new financing for businesses with up to 10,000 employees or $2.5 billion in 2019 annual revenues. Learn more.

Loans Available to Small Businesses

There are a number of Small Business Administration loans available to physician practices.

Economic Injury Disaster Loans
The Economic Injury Disaster Loan establishes an emergency grant to allow a practice that applies for an Economic Injury Disaster Loan to receive an advance on that loan of no more than $10,000, which the Small Business Administration must distribute within three days. The money may be used to pay for employees’ COVID-19-related sick leave, mortgage or rent, and other overhead expenses. The grants would be awarded on a first come, first served basis until the $10 billion fund is exhausted, and applicants would not have to repay the money even if they are denied the loan.

Small Business Administration 7(a) Loans
The CARES Act provides economic relief to small businesses through Small Business Administration (SBA) loan guarantees and subsidies. The SBA program primarily provides financial assistance to small businesses through the 7(a) loan program. The CARES Act increases the maximum 7(a) loan amount from $5 million to $10 million. The law also expands eligible uses of 7(a) loans to include payroll support, employee salaries, mortgage payments, insurance premiums and any other debt obligations, and makes other important changes. Under the CARES Act, entities eligible for 7(a) loans include small businesses, nonprofits and veteran organizations with fewer than 500 employees.

Paycheck Protection Program
In additional to the EIDL grants and increased SBA 7(a) loans, the CARES Act establishes a third loan program for small businesses called the Paycheck Protection Program (PPP). PPP loans are designed to help small businesses avoid closure or layoffs, and can be used to cover payroll, utilities, insurance premiums, and rent and mortgage interest payments on a facility. This program concludes on June 30, 2020, and is tailored for businesses that typically would not qualify for a loan at an average local or national bank. The loans require no collateral, credit test or personal guarantees from a business, only proof that the business was open and operational on February 15, 2020. In order to attract lenders, the government is offering a 100% guarantee on loans through the end of 2020.

Loan Forgiveness

The CARES Act establishes a forgiveness policy for all loans granted by the SBA as part of the COVID- 19 response. All recipients of SBA 7(a) loans—including those granted through the PPP—are eligible for loan forgiveness equal to the amount the borrower spends in the eight weeks after the loan is originated. Loan forgiveness will not be included in income tax and can be applied to payroll costs up to $100,000. Employers must provide payroll information from this year and the same time last year to demonstrate that they are maintaining wages. Employers will not be penalized for rehiring employees who were recently let go.

Update-New Simplified EZ and Full Forgiveness Applications

On June 17, the Small Business Administration and Department of the Treasury announced a new, simplified “EZ” version of the loan forgiveness application for certain borrowers under the Paycheck Protection Program. The Administration also announced a revised 5-page version of the full loan forgiveness application to ease certain requirements for borrowers. Learn more about eligibility and begin the simplified applications for PPP loan forgiveness here.

Process for Accessing Small Business Administration (SBA) Coronavirus (COVID-19) Disaster Relief Lending

Find more details on how to apply for small business relief and begin your application online here.

Details from House Small Business Committee website:

SBA’s Economic Injury Disaster Loans offer up to $2 million in assistance per small business and can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing.

These loans may be used to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact. The interest rate is 3.75% for small businesses without credit available elsewhere; businesses with credit available elsewhere are not eligible. The interest rate for non-profits is 2.75%.

SBA offers loans with long-term repayments in order to keep payments affordable, up to a maximum of 30 years. Terms are determined on a case-by-case basis, based upon each borrower’s ability to repay.

For additional information, please contact the SBA disaster assistance customer service center. Call 1-800-659-2955 (TTY: 1-800-877-8339) or e-mail disastercustomerservice@sba.gov.

Fact Sheets from the House Small Business Committee:

Tax Relief for Businesses

The IRS has established a special section focused on steps to help taxpayers, businesses and others affected by the coronavirus. More information can be found here: https://www.irs.gov/coronavirus

Assistance with Telehealth from Federal Communications Commission (FCC)

  • $200 million COVID-19 telehealth program designed to provide eligible health care providers responding to the pandemic with funding for telecommunications, information services, and devices necessary to provide connected care. 
  • Use the FCC  portal to submit applications 
  • FCC will be evaluating applications on a rolling basis until funding is exhausted

You may be able to temporarily stop making your payments. Please contact your loan servicer to find out your specific options.

Income tax break for some employees

Employee borrowers of student loans that receive assistance from their employers in paying off student loans will not have to pay income tax on any payment assistance. Under current law, employers can provide their employees with up to $5,250 per employee per year in educational assistance—generally for tuition, fees, and related supplies—that is excluded from wages (and hence not subject to income or payroll taxes).

  • Under the new law, qualified student loan payments would be subject to the overall cap of $5,250 per employee per year.
  • Payments made by the employer could go to the employee directly or to the lender.
  • Payments could cover both the principal and interest of the qualified student loan. Qualified student loans would be those eligible for the student loan interest deduction (IRC section 221(d)(1)) that are incurred by the employee for the employee’s education. This provision would apply to any student loan payment made by an employer on an employee’s behalf after the date of enactment and before January 1, 2021.

Relief for Families

  • Retirement account withdrawals. The bill allows for a withdrawal of money from retirement funds (i.e., 401K, etc.) of up to $100,000 in 2020 without paying a tax penalty if the physician, their spouse or dependent are diagnosed with SARS-CoV-2 or COVID-19, or experience adverse financial consequences as a result of being quarantined, furloughed, laid off, or having work hours reduced due to the viruses.
  • Deferred Social Security tax. Employers and self-employed individuals would be allowed to defer payment of their employer share of the Social Security tax until Dec. 31. The deferred amounts would be paid over the following two years, with half of the amount required to be paid by Dec. 31, 2021, and the other half by Dec. 31, 2022.
  • Federal tax rebates. The bill provides for a one-time federal income tax rebate for eligible physicians and their employees in 2020. The rebate amount would be $1,200 for individual tax filers, $2,400 for those filing a joint return and $500 for each child. (The amount of the rebate will be reduced for single filers making more than $75,000 and joint filers earning in excess of $150,000.)

Disclaimer: This committee resource is provided for informational purposes only and does not represent medical or legal advice.  It has not been approved by ASA’s Board of Directors or House of Delegates and does not represent an ASA Policy, Statement or Guideline.