April 2, 2020
Coronavirus Aid, Relief, and Economic Security Act (CARES Act)

Coronavirus Aid, Relief, and Economic Security Act (CARES Act)

On March 27, 2020, the U.S. Congress passed the CARES Act (The Act) and sent it to President Trump's desk, where it was quickly signed into law. The Act is both a major stimulus package for the economy and an historic piece of legislation, with major implications for health plans going forward.

What is the CARES Act?

The Act is the third phase in Congress’ response to COVID-19 following the Coronavirus Preparedness and Response Supplemental Appropriations Act and the Families First Coronavirus Response Act (FFCRA). The roughly $2 trillion Act provides emergency relief aimed to assist business, individuals, and hospitals during the period of public health emergency due to COVID-19. The Act provides various benefits to individuals such as cash payments and increased unemployment benefits, as well as funding for various state and federal programs. The following are key provisions included in The Act.

Changes Affecting Health Plans:

  • Expanding the types of coronavirus testing health plans/insurers must cover without cost-sharing (such as deductibles, copayments or coinsurance) or prior authorization; 
  • Accelerating the process that will require health plans and issuers to cover preventive services and vaccines related to COVID-19;
  • Allowing telehealth and other remote care services to be covered under a high deductible health plan (HDHP) before the deductible is met, without affecting the HDHP’s compatibility with health savings accounts (HSAs) (applicable for HDHP plan years beginning on or before Dec. 31, 2021); and
  • Treating over-the-counter (OTC) medications, along with menstrual care products, as qualified medical expenses that may be paid for using HSAs or other tax-advantaged arrangements, such as health flexible spending accounts (FSAs) or health reimbursement arrangements (HRAs).
  • Read more here.

FFCRA Emergency Family and Medical Paid Leave and Emergency Paid Sick Leave Amendments and Clarifications :

  • Amends the EFMLA leave portion of the FFCRA to include a limitation on the amount that employers are required to pay to employees during emergency leave taken due to the employee’s need to care for their minor child. .
  • Clarifies the EFMLA portion of the FFCRA, including granting emergency family and medical leave eligibility to employees who were laid off by an employer after March 1, 2020, had worked for the employer at least 30 of the last 60 days before the layoff, and have since been rehired.
  • Amended the EPSLA leave portion of the FFCRA, which entitles employees to up to 80 hours of paid sick leave, in order to limit the amount that an employer is required to pay.
  • Read more here.

Unemployment Insurance Expansion:

  • Expands eligibility for unemployment insurance, extends benefits an additional 13 weeks, allows for waiver of a State's initial 7 day waiting period, and provides unemployed individuals with an additional $600 per week on top of the unemployment amount determined by each State.

Paycheck Protection Program (PPP):

  • Established to provide small employers with an incentive to keep workers on their payroll during the COVID-19 crisis. The PPP is an extension of the SBA Section 7(a) loan program, which offers qualifying small businesses are eligible to borrow up to $10 million, in order to maintain their workforce from February 15, 2020, until June 30, 2020. All or a portion of the loan may be forgiven if the borrower follows the SBA guidelines. Treasury has issued FAQs and the application form on its website. Information on the program is also available on the SBA website.

Where can I learn more about the CARES Act and Other COVID-19 Issues?

You can learn more about the CARES Act and other COVID-19 requirements, as well as access employer resources, on our designated COVID-19 page here. Keep up-to-date with the latest developments by visiting our site regularly.

Who can I speak with for further information on the CARES Act?

All of us at Sullivan Benefits welcome any and all questions you have as they pertain to ongoing developments surrounding the COVID-19 situation. The situation is fluid and changing daily, but we are here to help you during these unprecedented times. You can reach us here, or feel free to contact any member of the Sullivan Benefits team directly via email or at 774-369-0280.
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