On June 8, 2020, the Paycheck Protection Program Flexibility Act was signed into law. Major provisions of the Act are as follows:
- The covered period for loan forgiveness is extended to 24 weeks after the date of the loan disbursement (originally 8 weeks).
- The requirements for loan proceeds to be used for payroll during the 24-week period was lowered to 60 percent (originally 75 percent).
- The repayment period for PPP loan amounts that are not forgiven is extended to 5 years (originally 2-year repayment period).
- The requirement to meet the FTE requirement is extended to Dec. 31, 2020.
The SBA, in consultation with the Treasury, will issue rules and guidance including a modified loan forgiveness application implementing the legislative amendments to the PPP loan (neither had been issued as of mid-June).
HHS Provider Relief Fund Portal for Eligible Medicaid and CHIP Providers
On June 10, 2020, HHS launched the portal for eligible Medicaid and CHIP providers. HHS expects to distribute approximately $15 billion to eligible providers that participate in state Medicaid and CHIP programs and have not received a payment from the Provider Relief General Allocation (the $30 billion and $20 billion relief funds based on Medicare revenue).
Applicants must meet all the following requirements:
- Must not have received payment from the $50 billion General Distribution.
- Must have directly billed Medicaid for healthcare related services during the period Jan. 1, 2018 to Dec. 31, 2019 or own an included subsidiary that has billed Medicaid during the same period.
- Must have either filed a federal income tax return for 2017, 2018, or 2019 or be an entity exempt from the requirement to file a federal income tax return and have no beneficial owner that is required to file a federal income tax return (i.e. a state-owned hospital or healthcare clinic).
- Must have provided patient care after Jan. 31, 2020.
- Must not have permanently ceased providing patient care directly or indirectly through included subsidiaries.
- If the applicant is an individual, must have gross receipts from providing patient care reported on Form 1040, Schedule C, Line 1.
The applicant must upload documentation to the portal (income tax returns, payroll tax returns, FTE worksheet provided by HHS). The deadline to submit an application is July 20, 2020. Go online to this article on NashvilleMedicalNews.com for links to instructions and the application.
Lucy Carter, CPA, is a member and practice leader for the Healthcare Industry Team at KraftCPAs, PLLC. A well-known industry expert, Carter has more than 35 years of experience working with healthcare providers and executives. For more information, go online to KraftCPAs.com
HHS Information on Provider Relief for Safety Net, Medicaid & CHIP Providers