ASPS advocacy update on passage of the $2 trillion COVID-19 stimulus package
On March 27, President Donald Trump signed the largest federal stimulus package in United States history, providing $2 trillion in immediate and comprehensive economic relief to first responders and industries impacted by the COVID-19 pandemic.
This law will specifically help plastic surgery practices through $377 billion in tax breaks and highly-favorable loans for small businesses and $250 billion in direct payments to Americans. ASPS aggressively advocated for these financial relief provisions to support your practice, so we wanted to provide you with insight on how this law can now help support you, your patients and your staff.
What financial relief options are available for my practice under this law?
- Small Business Administration (SBA) Paycheck Protection Program Loans: The law provides $359 billion for the new Paycheck Protection Program under the 7(a) Small Business Administration lending program. Plastic surgery practices and health care facilities with under 500 employees at each location will be able to apply for a loan that will help pay for payroll and operating costs incurred between February 15, 2020, and June 30, 2020. The loan amount could be 250% of your practice's average monthly payroll and operating costs (payments for utility, rent, mortgage interest, continuation of group health benefits and debt obligation interests) up to $10 million. The loans provide 8 weeks of financial assistance, and under the program, you will have the opportunity for total loan forgiveness if you maintain your payroll and number of full-time employees on staff. Learn more about this program by reading our summary and FAQ resources.
- Delay of Payroll Taxes: Employers and self-employed individuals can defer payment of their employer payroll taxes over two years. The first half must be paid by December 31, 2021, and the other half by December 31, 2022.
- Employee Retention Tax Credit: Employers can receive a refundable payroll tax credit for 50 percent of wages by employers to employees during the COVID-19 crisis. The credit is available to employers whose: (1) operations were fully or partially suspended due to a COVID-19 shut-down order; OR (2) their gross receipts declined by more than 50 percent when compared to the same quarter in the prior year. For employers with less than 100 employees, all employee wages would qualify for the tax credit regardless of if the employer is open for business or subject to a shut-down order. For employers with more than 100 employees, the credit is available to pay for wages when the company is not providing services due to the COVID-19 circumstance.
- Student Loan Repayment Benefit: Employers can provide a student loan repayment benefit to their employees on a tax-free basis up to $5,250 until January 1, 2021.
How can the law provide personal financial relief to your patients, staff, family and you?
- Direct payments to Individuals & Families: Adults with an annual income of up to $75,000 will receive a one-time rebate check of $1,200 per individual and $500 per child. Some individuals with incomes above $75,000 could also be eligible to receive a direct payment. You can calculate estimated stimulus payments here.
- Unemployment Benefits: Provides more support to the unemployed by adding $600 a week more to unemployment payments until the end of July. Additionally, individuals who are self-employed or are independent contractors are now eligible to receive unemployment benefits under a temporary Pandemic Unemployment Assistance program until December 31, 2020.
- Short-term Relief from Retirement Account Withdraw Penalties: The law will allow individuals the opportunity to withdraw up to $100,000 penalty-free from their retirement accounts until January 1, 2021. Relief for Student Loan Borrowers: The law will allow individuals the opportunity to withdraw up to $100,000 penalty-free from their retirement accounts until January 1, 2021.
- Charitable Tax Deduction: Americans who contribute to churches and charitable organizations like the Plastic Surgery Foundation in 2020 will be allowed to deduct $300 of past contributions, whether they itemize their deductions or not.
- Delay of Eviction Fillings: Residential landlords are prohibited from starting legal action to recover possession of a rental unit or to charge penalties for nonpayment of rent by a tenant when the landlord's mortgage on property is insured, protected and assisted in any way by the U.S. Department of Housing and Urban Development, Fannie Mac and Freddie Mac.
How will the law help physicians respond to the COVID-19 pandemic and improve overall access to specialty care?
- Establishment of a Public Health & Social Services Emergency Fund: This emergency fund will provide $100 billion in funding for health care services that are related to the COVID-19 pandemic response, It will also include $1 billion in funding under the Defense Production Act to increase domestic medical supply chains and $16 billion in funding to replenish the Strategic National Stockpile so our nation's first responders and patients have access to personal protection equipment (PPE) and medical supplies.
- COVID-19 Good Samaritan Protections: Physicians who provide volunteer medical services during and in response to the COVID-19 public health emergency have liability protections under federal and state law. The law language includes state protections to address the patchwork of medical liability laws.
- Medicare Sequestration Relief: Increased funding to temporarily prevent Medicare sequestration from May 1, 2020, to December 31, 2020. This means physicians will no longer see a 2% Medicare payment reduction for the remainder of 2020.
- Extension of the Work Geographic Practice Cost Index (GPCI) Floor: The current GPCI floor will be extended until September 30, 2020, to ensure that physicians are reimbursed at Medicare rates that reflect the health care markets they are practicing in.
Please know: this 833-page legislation just passed, and the federal agencies will be beginning a required guidance and regulation period for many of these new programs. As we receive more details on how you can start taking advantage of these opportunities, we will let you know as soon as possible. In addition to this federal stimulus package, we encourage you to take advantage of relief opportunities in your local communities and states as they become available.
We invite you to join our WEBINAR on Tuesday, March 31, 2020, to learn more about how you can take full advantage of the stimulus package for your practice. If you need additional information, please refer to member resources on our COVID-19 website at PlasticSurgery.org/COVID19 to learn more about the law and the Society's response. Please let us know how we can continue to help you during this difficult time.
The COVID situation is fluid and these recommendations will be reviewed regularly and as necessary.
Lynn Jeffers, MD, MBA, FACS