July 10, 2020
HHS Paying Out Additional $15 Billion in CARES Relief to Medicaid Providers

$50 billion from the federal Provider Relief Fund was distributed in April by the U.S. Dept. of Health & Human Services to nearly 335,000 facilities and providers that billed Medicare in 2019 and were affected by COVID-19. The payments were based on providers' 2018 net patient revenue. Of this $50 billion, the initial $30 billion was distributed between April 10 and April 17, and payments to providers from that $30 billion were calculated based on providers’portion of Medicare fee-for-service revenue. Many American Pharmacies members reported receiving payments in the April distribution.
An additional $15 billion is being distributed by the federal agency through July 20 to providers that participate in state Medicaid/CHIP or Medicaid managed care programs and DID NOT receive a payment from the April 10-17 distribution described above. You must apply for the distribution to receive a payment. Here are the pertinent facts:

  • The distribution is not a loan and does not have to be repaid.
  • The deadline to apply for the Medicaid Provider Relief Fund is July 20.
  • You are eligible for the distribution if your pharmacy billed Medicaid/CHIP or Medicaid managed care from Jan 1, 2018, through Dec 31, 2019, and provided patient care after January 31, 2020.
  • The payment will be at least 2% of your reported gross revenue from patient care. The final amount will be based on the actual data you submit.
  • You can apply for these funds through the provider relief payment portal.
  • Only one application can be submitted and it cannot be revised or resubmitted. Don't apply until you have gathered all the information and documentation required for the application.
  • The application can be found here. Instructions are here. There also are some helpful FAQs.
  • NCPA has a 30-minute video to help you navigate the process.
  • Once you receive the funds, you have 90 days to attest to the terms and conditions of the distribution. See the paragraph below for more information about attestation.
  • Get professional financial or legal advice if you need it.

Attestation is Required After Receiving Payment
Within 90 days of receiving the payment, you must sign an attestation confirming receipt of the funds and agreeing to the terms and conditions of payment . If you choose to reject the funds, you still must complete the attestation. The  attestation portal  will guide you through the attestation process to either accept or reject the funds. Not returning the payment within 30 days of receipt is viewed as acceptance of the terms and conditions.

Please visit hhs.gov/providerrelief for eligibility requirements, terms and conditions, Frequently Asked Questions and a recording of past webinars on the application process. For additional information, you can call the provider support line at 866-569-3522; for TTY dial 711. Hours of operation are 7 a.m. to 10 p.m. Central Monday through Friday. Service staff members are available to provide real-time technical assistance, as well as service and payment support.
PPP Loans Extended Through Aug. 8;
Conditions for Forgiveness Relaxed

On July 4, President Trump signed a new law extending the deadline for applying for a Paycheck Protection Program (PPP) loan from June 30 to August 8. The program has so far distributed about $520 billion in loans to almost 5 million small businesses across the country.

The program had expired on June 30, but in a surprise move last week, the Senate and House both unanimously voted to give borrowers more time to access the program under the existing terms. Approximately $130 billion in funding remains.

The extension of the application deadline follows the enactment of the Paycheck Protection Program Flexibility Act of 2020 (PPPFA), signed into law on June 5. The primary impact of the PPPFA is that it provides the over 4.4 million Paycheck Protection Program (PPP) borrowers additional time to qualify for forgiveness and eases the restrictions on how much of the forgivable portion of the loan proceeds must be used for payroll costs.

There also is a simpler, shorter forgiveness application form that requires borrowers to submit less data to their lender and the federal government. Notably, the EZ forgiveness application form requires less detail from applicants and does not require the PPP worksheet, which in the longer application requires borrowers to include employee-level detail on how PPP dollars are used.

If you meet at least one of the three requirements below, you may be able to complete and submit the EZ PPP loan forgiveness application.

  1. You are self-employed and do not have any employees.
  2. You did not reduce your employees' hours or their salaries or wages by more than 25%.
  3. You experienced reductions in business as a result of health directives related to COVID-19 AND did not reduce the salaries or wages of your employees more than 25%.

Key Provisions of the PPPFA:

  • The PPP Flexibility Act amends the PPP to give borrowers more time to spend loan funds and still obtain forgiveness.
  • Borrowers now have 24 weeks to spend loan proceeds, up from 8 weeks.
  • The Act also reduces mandatory payroll spending from 75% to 60%.
  • Two new exceptions let borrowers obtain full forgiveness even without fully restoring their workforce.
  • Changes made by the PPPFA have been incorporated in new forgiveness applications released by the SBA.
  • Time to pay off the loan has been extended to five years from the original two.
  • The Act now lets businesses delay paying payroll taxes even if they took a PPP loan. 

Under previous PPP loan guidance, borrowers had eight weeks from the time they received the first loan installment to spend the funds. The PPP Flexibility Act of 2020 lets them extend that period to 24 weeks (but not beyond Dec. 31, 2020). They also have the option to keep the original eight-week spending period if they already had their loan before enactment of the Act. Under the new timeline, full forgiveness is still possible.

The original PPP loan guidelines mandated that 75% of any forgiven amount had to be spent on payroll costs. The Flexibility Act reduces required payroll expenditures to 60% of the loan amount with up to 40% of the loan amount used for mortgage interest, rent or utility payments to obtain full loan forgiveness of that amount. Or, part of the loan can be forgiven provided the borrower maintains the same 60/40 ratio for the amount forgiven. This change responds to complaints from many businesses that their payroll costs went down as employees were laid off but fixed costs like rent did not.

Borrowers can now use the new 24-week period to restore their workforce to pre-COVID-19 levels in order to obtain full forgiveness. The new deadline to achieve this is Dec. 31 vs. the previous deadline of June 30.