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COVID-19 Practice Financial Assistance

Last updated 8/4/2020

Practice Re-opening Resources

  • ACP’s Clinician’s Guide includes some resources to help guide practices in plans for re-opening.  Resources include guides, checklists, staffing and workflow modifications, and materials for communicating with patients.
  • The CDC offers a framework for providing non-COVID-19 care during the pandemic.
  • ACP offers clinical and public policy guidance on how to resume some economic, social and medical care activities to mitigate COVID-19 and allow expansion of healthcare capacity.

There are several mechanisms in the CARES Act to assist in mitigating financial shortfalls due to COVID-19:

Provider Relief Funds:

Relief Fund Payments are intended to provide funds to hospitals, physicians, and other healthcare entities.  These are payments, not loans, so recipients will not need to be pay them back.  There have been 3 distributions of payments, plus  one for Medicaid and CHIP providers. 

  • These FAQs seek to clarify some of the confusion regarding this program, especially how to calculate the amount due, how to reject a payment, and what is required if accepted.
  • The IRS recently provided clarification that Provider Relief Fund payments are considered taxable income.  ACP is advocating Congress to change that.
  • Regardless of which payments you have received, it is important to keep detailed records (receipts, payments, etc) of how you spend the money.  You must retain the records for 3 yrs from the date of receipt.

General Allocation:

  • The 1st distribution of these payments arrived via direct deposit on April 10 or April 17.  Electronic payments were automatic payments via OptumBank and are labeled “HHSPAYMENT”.  (Paper checks were mailed in the weeks following.) 
    • Payments were paid to the TIN that usually receives Medicare payments (such as the group practice, the employing entity, or billing company). 
    • This first payment was based on a share of Medicare fee-for-service reimbursements in 2019.
  • The 2nd distribution of payments began on April 24.
    • For more information, see the Relief Fund Application Guide  and the FAQs about the program.  
    • Note:  Per the PRF FAQs, “If the initial General Distribution payment you received between April 10 and April 17 was determined to be at least 2% of your annual patient revenue, you may not receive additional General Distribution payments.”
    • Facilities and practices who received a payment from this general allocation must sign an attestation confirming receipt of the funds and agree to the terms and conditions within 90 days of payment. However, physicians had until June 3 to access the application portal to submit their tax and revenue loss information.  CMS reallocated all General Distribution funds owed based on the submitted application.  
      • Note that there are some restrictions attached, such as the requirement to accept in-network fees for services provided to patients (no balance billing).
  • Phase 2 general distribution to Medicaid, Medicaid managed care, and CHIP providers, and certain Medicare providers who did not receive from the initial $50 billion general distribution will get another opportunity to receive funding. Both groups have until Friday, August 28, 2020, to apply.

Targeted Allocations:

  • On May 7, 2020, Medicare began paying physicians who have provided testing or treatment for uninsured patients with COVID-19 on or after February 4. For more information on how to enroll, determine patient eligibility, submit claims, and receive payment via direct deposit, see the uninsured program portal
  • Hospitals in High Impact Areas:  Hospitals deemed eligible for these funds were contacted directly.
  • Rural Health Clinics and Hospitals: These organizations were allocated these payments directly, based on their operating expenses.
  • Indian Health Service Facilities: These organizations were allocated these payments directly, based on their operating expenses.
  • HHS is distributing another $15 billion in CARES Act Provider Relief Fund payments to eligible Medicaid and CHIP physicians and organizations. The payment will be at least 2% of reported gross revenue from patient care, and the final amount will be determined based on submitted data including the number of Medicaid patients served. Eligible physicians and organizations now have until August 3, 2020, to submit their application and report other necessary information.

Medicare’s Accelerated and Advance Payment Program

The Accelerated and Advance Payment Program was suspended as of April 26. 

  • For those who received payments through this program, this FAQ explains the payback terms. 
  • ACP and other medical societies are advocating to bring this program back as well as improve payback terms to prevent further deferred cash flow problems.

Small Business Administration Programs

The Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL) emergency advance, which are managed by the Small Business Administration (SBA), offer low-interest loans to small businesses to cover payroll, benefits, rent, mortgage, utilities, and other business expenses.  

  • The Paycheck Protection Program Flexibility Act of 2020 became law on June 5, 2020.  The legislation lowers the amount required to be spent on payroll costs from 75% to 60%.  It also extends the “covered period” to 24 weeks (through Dec. 31), allows PPP borrowers to defer payroll tax payments, establishes 5 years as the minimum maturity term for the balance remaining after forgiveness, and provides greater flexibility to rehire employees that would otherwise reduce the amount forgiven. Specifically, this law:
    • Establishes a minimum maturity of five years for a paycheck protection loan with a remaining balance after forgiveness.
    • Extends the covered period during which a loan recipient may use such funds for certain expenses while remaining eligible for forgiveness.
    • Raises the non-payroll portion of a forgivable covered loan amount from the current 25% up to 40% (and lowers the payroll portion from 75% to 60%).
    • Extends the period in which an employer may rehire or eliminate a reduction in employment, salary, or wages that would otherwise reduce the forgivable amount of a paycheck protection loan. However, the forgivable amount must be determined without regard to a reduction in the number of employees if the recipient is (1) unable to rehire former employees and is unable to to hire similarly qualified employees, or (2) unable to return to the same level of business activity due to compliance with federal requirements or guidance related to COVID-19.
    • Revises the deferral period for paycheck protection loans, allowing recipients to defer payments until they receive compensation for forgiven amounts. Recipients who do not apply for forgiveness shall have 10 months from the program's expiration to begin making payments.
    • Eliminates a provision that makes a PPP loan recipient who has such indebtedness forgiven ineligible to defer payroll tax payments.
  • Loan forgiveness applications: The SBA released an application to submit to lenders when seeking loan forgiveness. The application contains instructions, a PPP Loan Forgiveness Calculation Form, and the PPP Schedule A (including a PPP Schedule A Worksheet). The deadline to apply has been extended to August 8, 2020.
  • This fact sheet for borrowers and FAQs from the Department of Treasury provide a lot of guidance and clarification on the PPP loan program. 
  • EIDL applicants who have already submitted their applications will continue to be processed on a first-come, first-served basis.
  • The AICPA offers an updated downloadable Loan Forgiveness Calculator and FAQs regarding the most recent changes and guidance to the SBA’s PPP program. (Updated 6/26) 

Other Tax Benefits

There are some tax benefits available to employers, including medical practices, designed to keep employees on the payroll.  [Note: It is important to talk to your accountant or financial advisor about the different programs, as some do interact with or are contraindicated with the above PPP loans.]  

  • Employee Retention Credit - The Employee Retention Credit is a fully refundable tax credit for employers equal to 50% of qualified wages (including allocable qualified health plan expenses) that Eligible Employers pay their employees. The IRS has issued some FAQs on the Employee Retention Credit, including eligibility, payback, and the interaction with other programs.
  • Payroll tax deferral - Allows employers to defer the deposit and payment of the employer's share of social security taxes and self-employed individuals to defer payment of certain self-employment taxes.  This is now allowed based on the PPP Flexibilities Act (passed 6/5/2020).
  • The CARES Act also includes provisions related to student loans.  Under the law, no federal student loans are required between March 13 and September 30, 2020, and interest will drop to zero during that time period.  In addition, employers can pay up to $5,250 toward an employee’s student loans tax-free through the end of the year. Normally, these payments are treated as wages, but until December 31, 2020, these payments can be excluded from income and payroll taxes – benefitting both the employer and those receiving the repayment assistance.