The CARES Act, Support for Physician Practices, and Student Loan News
This communication highlights financial assistance opportunities for physicians, students, and practices of varying size in accordance with the Coronavirus Aid, Relief, and Economic Security (CARES) Act:
- Paycheck Protection Program (for businesses with up to 500 employees)
- Coronavirus Economic Stabilization Act (for businesses between 500-10,000 employees)
- Emergency Economic Injury Disaster Loans
- Small Business Debt Relief
- Public Health and Social Service Emergency Fund
- Student Loans
Payroll Protection Program
Physician practices with up to 500 employees, including sole proprietors, independent contractors, and self-employed persons, are eligible to apply for the Small Business Association's (SBA) Payroll Protection Program. The PPP allows a small business to apply to an SBA-approved lender for a loan of up to 250% of the business’ average monthly payroll costs to cover eight weeks of payroll, as well as other expenses, including rent, mortgage payments, and utilities. The maximum loan amount is $10 million. Though PPP is listed as being available through June 30, 2020, the funding stream is drying up quickly. Michigan legislators have been pressing the Administration to convert this from a loan to a grant.
To find an eligible lender in Washtenaw County, please click here.
Coronavirus Economic Stabilization Act (CESA)
Title IV of the CARES Act includes a subtitle called the Coronavirus Economic Stabilization Act (CESA), which created the Main Street Lending Program. This program will enhance support for mid-sized businesses with 500-10,000 employees that were in good financial standing before the crisis by offering 4-year loans to companies with revenues of less than $2.5 billion. For detailed information, please click here.
Economic Injury Disaster Loan (EIDL) Emergency Advance
Small businesses are eligible to apply for an Economic Injury Disaster Loan advance of up to $10,000. This advance will provide economic relief to businesses that are currently experiencing a temporary loss of revenue. This loan advance will not have to be repaid. To apply, please click here.
Small Business Debt Relief
The Small Business Administration will automatically pay the principal, interest, and fees of:
- current 7(a), 504, and microloans for a period of six months, and
- new 7(a), 504, and microloans issued prior to September 27, 2020.
More information is available here.
Public Health and Social Services Emergency Fund
The CARES Act provides $100 billion in relief funds to hospitals and other healthcare providers on the front lines of the coronavirus response. $30 billion is currently being distributed to eligible providers proportionately based on how much a given provider billed Medicare fee-for-service in 2019. Michigan counted 11,383 providers and systems in 2019 for a first distribution payment total of $936,700,139.
These are payments, not loans, to healthcare providers, and will not need to be repaid. To determine eligibility and payment distribution, please click here.
Recent HHS clarification on this relief opportunity: "if providers ceased operation as a result of the COVID-19 pandemic, they are still eligible to receive funds so long as they provided diagnoses, testing, or care for individuals with possible or actual cases of COVID-19. Care does not have to be specific to treating COVID-19. HHS broadly views every patient as a possible case of COVID-19."
Student Loan News from MD Wealth Management
- All required federal direct loan payments have been suspended until September 30, 202
- Required payments toward federal direct loans will be stopped automatically
- The interest rate for federal loans will be 0% during this time, so no interest will accrue on student loans
- The six months of $0 payments will still count as qualifying payments for Public Service Loan Forgiveness
- Individuals can still make voluntary payments toward student loans, with any payments going 100% toward paying down accrued interest or principal
- Private student loans were not included in the CARES Act
Students are encouraged to speak with their financial aid office to affirm if Federal Supplemental Educational Opportunity Grants (FSEOG) are available for additional financial assistance as it can be used for emergency aid per the CARES Act.
- The Small Business Association of Michigan COVID-19 Resources Page includes FAQs, webinars, and expert assistance.
- The Michigan Economic Development Corporation has programs for small businesses which include: Michigan Strategic Fund Awardee Relief Initiatives, Northern Initiatives Program, and PPE procurement.
- Find a local assistance center in Washtenaw County by clicking here.
- Ann Arbor SPARK webinars and virtual events for community-based economic development and financial support.
*Reference to any specific commercial product, process, or service, or the use of any trade, firm or corporation name is for the information and convenience of members, and does not constitute endorsement, recommendation, or favoring by the Washtenaw County Medical Society.