The Cares Act Provides Billions for Health Care & Small Businesses
The Coronavirus Aid, Relief, and Economic Security Act or “CARES Act” passed the House of Representatives today and President Trump has indicated he will sign the legislation immediately. The 883-page bill contains the largest stimulus package in U.S. history with over $2 trillion in aid.
Included in the CARES Act is $100 billion for a new program that provides grants to hospitals, public entities, not-for-profits, and other eligible health care providers for health care related expenses or lost revenues related to the coronavirus. An additional $200 million was appropriated to the Centers for Medicare and Medicaid to prevent, prepare and respond to coronavirus, with $100 million specifically designated for nursing homes in localities with community transmission of the disease. Here is a link for further information on the CARES Act related to healthcare. Unfortunately, relief will not be immediate. The Secretary of Health and Human Services must first create regulations and an infrastructure for distribution of grants. We will continue to monitor HHS and provide additional information as it becomes available.
The CARES Act includes an alternative and likely quicker path towards relief funds through the $350 billion Paycheck Protection Program. This program provides eight weeks of cash-flow assistance for small businesses, defined as businesses with fewer than 500 employees or applicable SBA standards for the industry. If the employer retains its employees and uses the loan to cover payroll, group health care benefits, employee compensation, interest on debt obligations, rent and/or utilities, the loan will be forgiven. The program is retroactive to February 15, 2020 in the hopes that workers already laid off will be brought back on payroll. The loans will be administered through the Small Business Administration and regulations must be promulgated within 15 days after enactment.
We are keeping close track of the daily changes to state and federal law while continuing to work closely with our clients during this unprecedented time. If you have a question about eligibility for CARES Act grants or relief funds, please reach out to your primary contact at Underberg & Kessler.
This alert does not purport to be legal advice on specific matters.
As always, if you have any questions, please feel free to contact us here or call us at 585.258.2800.
You can view more COVID-19-related posts in our COVID-19 Resource Area here.