COVID-19 financial lifelines to keep your practice running

Although COVID-19 has been a significant burden on your practice, the Coronavirus Aid, Relief, and Economic Security (CARES) Act offers financial lifelines to help you keep running until things get back to normal.

Here’s a quick rundown on some of the key advanced payments and small business loans, and funding options available to your practice:

Medicare Advance Payments: Get Early Reimbursements

You can use the Medicare Accelerated and Advanced Payments program to overcome short-term cash flow shortages. The program allows you to receive upfront Medicare payments for services you expect to bill in the months to come and then pay them back in a specified timeframe once you’re seeing patients again.

If you are struggling to make payroll, the program can give you much needed cash quickly. You can request up to 100% of your non-emergency quarterly Medicare payment amount. Also, as a Part B provider, you will have 210 days from the date of the accelerated or advance payment was made to repay the balance.

To qualify for the program which is part of the CARES Act, your practice must meet three criteria:

Current Medicare Enrollee: Your provider must have billed Medicare for claims within 180 days immediately prior to the signature date on the request form.
Financially, Compliantly Stable: Your practice must not be in bankruptcy, under active medical review or program integrity investigation.
No Audit Penalties Due: Overpayment not have any outstanding delinquent Medicare overpayments.

If you meet the program requirements, your cashflow can begin in as little as 7 days. To ensure fast processing, follow a few tips:

Find application on your MAC site: You can locate your contactor-specific form on its website. Your form won’t be reviewed or processed if it’s incomplete, so make sure to fill in all the required information when you submit the form.
Expect immediate response: If you don’t hear back in a week, follow up with your MAC to make sure your email was received – and your form was complete. Medicare is accepting and processing these requests immediately and expecting to issue payments within seven days of the provider’s request. There is no specific deadline date.
Apply for need now: The expansion of this program is only for the duration of the public health emergency so don’t delay applying if you need advanced payments. For more program details, view the program Fact Sheet.

Apply for Payroll, operations Loans

Your practice can receive loans to pay expenses such as payroll, salaries, employee compensation, health insurance benefits, mortgage interest, rent, and utilities. The aid can also provide up to $600 weekly unemployment compensation—in addition to state benefits—for up to four months.

The small and large business financial aid includes two primary segments:

Economic Injury Disaster Loans (EIDL). You can apply online and receive a loan of up to $2 million, plus an additional $10,000 advance. The loan term is 30 years, with interest rates ranging from 2.75% for non-profits to 3.75% for small business. You get a 1-year payment deferment (although interest begins to acrue once funds are dispersed). You can use EIDL funds to pay for payroll and other operating expenses.
Paycheck Protection Program Loans (PPP). PPP loans are a Small Business Administration (SBA) program and are primarily to help your practice cover payroll. The PPP can provide you with a loan of up to 250% of your average monthly payroll costs up to $10 million. The loan is at 1.00% fixed rate and you have 2 years to pay it back. These loans will be forgiven as long as you use them to cover payroll costs, and most mortgage interest, rent, and utility costs over the 8-week period after the loan is made; and you maintain employee and compensation levels.

To fully use the aid, comply with a couple of rules:

Coordinate using both funds for different expenses: You can take advantage of both EIDL and PPP loans provided you don’t use the aid to cover the same thing such as payroll expenses. Consult with your lender though because any EIDL advance funds could change the amount forgiven in your PPP loan.
Act now, ensure available monies: There are lending caps and processing time, so don’t delay! Submit your Paycheck Protection Program loan application and supporting required documentation to an approved lender no later than June 30, 2020.

The information above includes merely a portion of the financial assistance available to your practice from the CARES Act. However, the regulation is lengthy, and actually accessing the money can be complicated. This is where healthcare attorneys, Daphne L. Kackloudis, Esq. and Ashley B. Watson, Esq., can help. During their online training “Get Your Practice Approved for CARES Act Financial Assistance” on Thursday, April 23^rd, you’ll get a step-by-step break down to help your practice plan its financial strategy.