-: Well good evening.
I'm Michael Repka.
I'm Medical Director for Government Affairs
with the Academy, and we're here tonight
to provide an update on COVID-19
financial relief programs.
Joining me tonight are David Glasser
who's Secretary for Federal Affairs.
And Scott Haber who is Academy Manager
for Federal Affairs and Public Health.
No speaker has any relevant financial disclosures
or relationships.
Doctor Glasser and I are AAO Consultants.
I would ask everyone to use the Q & A function
for questions and comments.
I think we've probably all learned
that that's more efficient.
And avoid using the chat function only
because it's hard for panel to go back
and forth between those two functions.
The webinar series began on April 11th in fact
with various programs focusing on the
relief programs as the Congress passed them
and the administration got them in place
with focuses on Medicare Advanced Payments,
Relief Funds, EIDL loans, PPP Funds,
Solos, retinal practice, and updates.
On each of those programs we of course
knew what we knew at that moment.
And though it would've been great
to know all of the future, at the time we didn't.
And so in the nine weeks that have gone on since
that first webinar, a lot of things have changed,
some things have stayed the same.
And sometimes people acted quickly
and maybe they acted slightly too fast
for the absolute best outcome.
And we'll try and go through those issues
as best we can.
All of these webinars are or have been available
for video viewing either the next day
or a few days after presentation.
The slide deck for this program should be
available tomorrow morning.
And we expect to continue to update our
fact sheets on the Academy website
based upon questions.
Recently some of the earliest webinars
have been taken down simply
because the information in them has
changed too much to be still relevant.
In nine weeks it's actually fairly astounding
how much the federal government has done
both at a Congressional and administration level
in creating, expanding, and providing funding
for these financial programs
that ophthalmologists have been able
to participate in successfully to date.
The Paycheck Protection Program
of course is now through three rounds.
Rounds one and two which are, if you will,
out there with a little bit more money to spend.
And the Paycheck Protection Program
Flexibility Act of 2020,
passed in the last few weeks,
changes some of the rules and Scott will
be going through those.
The EIDL, or Economic Injury Disaster Loan program
had been open in March and April,
closed except to agriculture in April.
And just this week has reopened
to provide some emergency advances for
and loans for people who have been affected
by this public health emergency.
CMS's Accelerated and Advance Payment Program
opened and closed and is still the subject
of Congressional consideration
to make the rules more favorable.
And the fund, or the program everyone likes
is the Provider Relief Funds
which now have rounds one, two, and three,
having nothing to do with boxing
but having everything to do
to getting money and getting your fair share
of those funds to help offset losses.
To cover a couple of the programs quickly,
CMS's Accelerated and Advanced Payment Program
was a cash flow program.
It was intended to get cash to you
from your MAC with a relatively short
repayment period beginning in just 120 days
and completed in 210 days from disbursement.
Otherwise you would pay very high interest rates
on post repayment balances.
CMS claim they lack flexibility
to set longer repayment terms.
And the Congress is looking at changing that.
Relatively few ophthalmology practices
applied or plan to apply for those payments.
And as I mentioned on the previous slide,
CMS suspended the program at the end of April
and are looking perhaps to reopen it
with more favorable situation in the weeks to come.
Congressional actions on COVID-19,
as I mentioned, have been remarkable.
They quickly passed three and a half bills if you will.
The first two bills focused on emergency response,
it got money out for government funding,
access to telehealth services
which changed the telehealth landscape
at least for Medicare dramatically.
And expanded paid and family medical leave benefits.
The CARES Act in those two bills,
was really focused on mitigating job losses
when it was passed in March.
Assisting with negative economic impacts,
and spent a whole lot of money in federal funding.
The third bill, Interim Stimulus Package
basically said, gee the small business loan
or PPP Program ran out of money
and it got additional money there
which is still there.
And Scott's going to review how
to apply for it if those are still
of interest to you.
In the last two weeks Congress
then passed the Paycheck Protection Program
Flexibility Act which made many more changes.
In previous webinars we've talked about
the eight week period.
We've talked about the 60% on payroll.
Scott's going to review those changes,
but they are fundamentally changing
the mathematics, the accounting
and in fact how people should be thinking
about this program going forward.
The next step for Congress,
not yet passed by the Senate,
not yet assigned by the administration,
is the HEROES Act which has even more money
basically based upon Democratic Party priorities.
But there are 100 million dollars more
for Provider Relief Funds suggested there
with some restrictions on how HHS
could distribute the dollars.
But those would come and make it to ophthalmologists.
It does improve the Accelerated and Advanced Payment Program
I mentioned, changing the rules,
making the interest rate much less
driving down the rate of recoupment.
And again, more money for the
Economic Injury Disaster Loan Program.
And of course it passed the House
and has a uncertain, I would say actually certain,
that it doesn't pass in this form in the Senate.
But the Senate clearly recognizes they need
to do something.
But they're dragging their feet in the sense
that they want to see something more about
what's happening with the already passed programs.
And we're hoping for something done before the end
of July on this next step.
This would be sort of the successor to the CARES Act.
The Academy continues to work with AMA,
the College of Surgeons and physician groups
to get this kind of assisstance for practices passed.
The 2% that David will mention in
Provider Relief Funds isn't enough
to cover 12 or 16 weeks of shutdown.
And so our efforts in D.C. continue
to be focused on both short-term
and long-term practice needs.
In the short run we want CMS
to reopen the Medicare Advanced Payment Program
as mentioned.
Congress will do those fixes and it requires
the bill, CMS can't do it.
And more money for the PPP Programs.
Long-term we want some of the things
that CMS has already done this year
and some things that they are going
to do for the 2021 fee schedule.
Perhaps most important is waiving budget neutrality.
Normally in a year over year,
our payments go down by a fraction
of a percent simply because utilization
was different than projected.
And this would say, no can't do that,
we're going to stay flat and not decrease the doctors.
We're also going to ask CMS to implement
payment increases for the E and M visits
that are already planned.
And try and get those payment increases applied
to the post-op visits.
And hopefully that will keep physicians closer
to whole on this.
The last thing we also want to do here
is not have cuts to the physician fee schedule
that are caused by this new add-on code.
You will be hearing about an add-on code
that CMS has that you can apply
to any E and M visit but not the eye codes
to get a little kicker to the payment
if you meet certain criteria.
And if that was to kick in,
and they projected how much it might kick in,
that would by necessity reduce every
other service a small part.
And by not having that reduction that will help.
Further, to avoid to cancel sequestration
going forward, recall that about 1.7%
of fees are already held back
by the government on sequestration
for the last, it seems like forever,
but it's the last six or seven years.
And that would give a kicker to payments.
And lastly, how about a positive physician
update instead of a zero percent update
which we're slated for next year.
Some of this we're going to see what CMS wants
to do in the proposed Notice of Rule Making
due the first or second week of July.
And that will give us some indication
of where the Congress, sorry,
where CMS is heading and where the Congress needs
to help us.
Now we'd like to turn to the big program,
the Paycheck Protection Program.
And that's the program that was the first one
that people applied for with lots of problems.
And Scott lived those problems
and so he's going to talk about the program.
-: Thank Doctor Repka.
So, just to give a quick recap.
The PPP received over 650 billion dollars
initially through the CARES Act
and then they did a second round of funding.
And we'll get to the changes that just passed
through Congress about 10 days ago.
So an Academy survey that we've been
consistently running has shown
that you know an overwhelming portion
of the numbers have applied for these loans.
And over the period that we've been doing
these webinars discussing the program,
we have seen more and more success.
And at this stage we're hopeful
that every member who has sought a PPE loan
has had success in obtaining the funds.
Right now there still remains over
a hundred billion dollars in the program.
What we know is that the last day to apply
for a PPP loan is June 30th.
And one thing I would add here is
that we've heard in the last day or so
that some banks are already beginning
to stop taking new applications.
And so if you are watching the webinar tonight
and you're still considering applying
for a PPP loan, my recommendation would be
to apply for one as soon as you possibly can.
So if you have questions on applying
for a PPP loan, these loans are available
through SBA approved lenders.
They're available through major banks,
community banks.
If you need to identify a lender
in order to apply for a loan,
please see a link here that's attached to the slide.
So Payroll Protection Program Flexibility Act
was passed back on June 3rd.
This made a number of substantial changes
some of which we had at hinted
at in previous webinars and were anticipating,
and some that we did not.
So the Act extended forgiveness
for expenses beyond the eight week period
to now 24 weeks.
But it also extended the rehiring deadline.
It also changed the amount that needed
to be used on payroll versus non payroll
from 75 25 to 60 40.
The definitions for the cover period
also changed from February 15th to June 30th
which was the original length
that the program was supposed to run
to an extended period which was
February 15th through the end of this year.
The other big change was that the loan maturity
was extended from two years meaning
that if part of your loan is not forgiven
you would have two years to pay off any remaining balance.
They've extended that to five years
and I'll go into a little bit more
about that in the coming slides.
So a Loan Forgiveness changes.
Like I said the Covered Period has been extended
from eight weeks to 24 weeks.
There we go.
Many of you likely have already received
a PPP loan, so you can still if you've
already received it you've already maybe
spent all of the money that you received
through the loan, you can still remain in
that eight week period when you elect
to apply for loan forgiveness.
Otherwise you have the ability
to alter things and use that 24 week period.
To receive loan forgiveness you're going
to have to use at least 60% of the PPP loan
on payroll costs, with 40% representing non payroll.
But an important change that was outlined
via guidance was that there wasn't going
to be a quote unquote cliff
and that you are still going to be eligible
for partial forgiveness if you used less
than 60% on payroll.
And there's a good example on the next slide.
So one of an example that came through
from Treasury, if a borrower received
a $100,000 PPP loan, and during the covered
period the borrower spends $54,000 or 54%
of this loan on payrolls costs,
then because the borrower used less
than 60% of its loan on payroll costs,
the maximum amount of loan forgiveness
the borrower may receive is $90,000.
And this is a good example
of what you would do if you do happen
to come in under that 60%,
that you'll still be eligible
for some forgiveness.
So seeking loan forgiveness.
The Treasury Guidance outlined
that borrowers need to submit
to their lend an application within 10 months
after the end of their loan forgiveness covered period.
No payments of principal or interest will
be due until SBA remits your loan
forgiveness amount to your lender.
Your lender also has to notify you
that the loan forgiveness was put on
to the loan and let you know the date
that your first payment is due.
A key point was that during that period,
interest is going to accrue on any balance
that's not forgiven.
Ultimately if all your loan is forgiven
that will include any interest
that accrued during that time period.
So this is another example.
So if you got a PPP loan on June 25 of this year,
the 24 week period ends on December 10th.
You need to submit a loan application
under this scenario by October 10th, 2021,
or else you'll need to begin making payments.
So there is a significant amount of time
which practices and borrowers are going
to be able to put forward the application
before they're going to need to start making payments,
which is a good thing.
So loan maturity, so if you received a loan
before June 5th the loan maturity is going to
remain at two years.
What Treasury has put forward is this idea
that borrowers need to speak directly
with their lender to see if they can sort
of amend the terms of the loan
to get them an extension.
So what we would recommend is
that you reach out directly to whoever
your lender is and say that you would like
to see if you can come to an agreement on extending.
If you apply for a PPP loan after June 5th,
the loan maturity is automatically going
to be five years.
-: Thank you Scott.
Reminder to everybody listening,
please put your questions in the Q & A function
of the Zoom platform and that helps us deal
with them plus you can vote for
which questions you like best.
So those are funds that could be a loan,
they could be forgiven and therefore be a grant.
But perhaps the favorite funds are
the CMS Provider Relief Funds
which truly are mostly free money
from the federal government.
Perhaps not as much as anyone would like though.
So David Glasser will speak about this program.
-: Thank you Michael.
So what's not to like about free money?
The Provider Relief Fund was disbursed
in several rounds as Michael mentioned
in the introduction.
And the first round was 30 billion dollars
of what they termed a General Distribution.
It's part of the CARES Act that was allocated
to both facilities, and providers.
So almost all providers of facilities who
had 2019 Medicare Fee For Service payments
were eligible.
The Payments were automatic.
You were required to attest to receipt of the money
and accept the terms and conditions
through the HHS portal within 90 days
of receipt of the funds.
And again, these were outright grants,
they weren't loans, they didn't need to be repaid.
And that first trench was just a hair
under 6.2% of your 2019 Fee For Service payments.
And they were sent to the billing organization
based on the tax ID number.
So this program was announced on April 10th
and the funds were pretty much distributed
from that first round by April 24th.
Those who received paper checks may have
gotten their money a little later.
And again, the funds went to the TIN billed in 2019.
If you happened to work for more than one TIN,
the amount attributed to your billings
would have been split between those TINs.
And it was based on your Part B receipts including drugs.
You can go to the next slide.
So you know why would they pick Part B
Medicare Fee For Service payments?
You know this sort of disadvantaged those
with minimal fee for service Medicare
in their payer mix, pediatrics,
ocular, plastic, ophthalmologists,
areas of high Medicare advantage.
On the other hand those who use a lot
of Part B drugs got larger payments
because it reflected the drug dollars from 2019.
And the answer is CMS had the data
and they wanted to get the money out
the door quickly.
They were more concerned with speed
than with accuracy.
And they planned to make up for the accuracy issue
with the second round.
And we advocated for a more inclusive process
and HHS and Congress responded.
The Provider Relief payments are just
a small part of the overall package
which you heard Michael describe
in the introduction.
And the second round of the General Distribution
was based on all-payer revenue, not just Medicare.
And then the third round will target distributions
to Medicaid and CHIP providers,
which launched just last week.
Go to the next slide.
So there were conditions associated
with the first 30 billions that was distributed.
And even if you didn't go to the portal
to accept the terms and conditions,
if you kept the money 90 days,
you were considered to be bound
by the terms and conditions.
Again, any provider that billed Medicare in 2019
was an eligible recipient as long
as they took care of any patients after January 31st,
even if they shut down since then.
And of course you didn't get any money
if you'd been terminated, excluded,
or had your billing privileges revoked
by Federal programs.
Those who received money had to agree not
to balance bill for out-of-network care provided
for treatment of COVID specifically.
The list did not apply to treatment
of ophthalmic disorders in patients who had COVID,
only to patients who were being treated for COVID.
The money could be used for any health care
related expenses, or to make up
for any lost revenues due to COVID.
So this is pretty anything associated
with running your practice.
Although you weren't allowed to use it
for expenses or losses that were going to be paid
by other sources.
So for example, you can't use the money
to pay for Part B drugs because Medicare's
going to pay for it.
If you are charging patients separately
for PPE you can't use the money to pay for PPE.
And there's a limit of $197,000 and change
on the maximum salary reimbursement per person
from these funds.
There are also records and reporting requirements.
All recipients are required to report
to ensure compliance.
HHS has not been specific about the details
but we think we know what they want
because everyone who applied for round two had
to tell them what your lost revenue was
and supply tax returns.
Those who receive more than $150,000 have
to report quarterly in even greater detail.
And we believe what counts towards
that $150,000 is all of the free money
and the grants, so the Provider Relief Fund payments,
any outright grants from EIDL Program,
and any forgiven portion of the PPP loans.
What doesn't count are the loans.
So Advance Payments, the EIDL loans,
and unforgiven portions of PPP.
The real key is to keep track of
where the money went, so keep meticulous records.
Next.
There were a host of other legally required
restrictions on use of the payment,
none of which really had much to do
with running your practice.
Although it's important to note
that you could not use the money
for lobbying, or political donations.
Next slide.
Then there was the second 20 billion
General Distribution.
And this caused some confusion and consternation.
HHS put out an estimate that the amount you
had received in the second round would
be equal to 2% of your 2018 all-payer revenue
minus whatever you got in the first round.
And this round was designed to true up
the distribution to those who got
very little in the first round
because they had very little Medicare billings.
And it really was only available
to those who'd receive some first round PRF distribution.
It excludes those who had no Medicare
Fee For Service billings.
Applying for the money from the second round
required attestation and application
through another HHS portal.
And the deadline was June 3rd.
They wanted to know what your 2018
gross receipts were from all-payers.
They wanted to know what your March
and April 2020 revenue was in comparison
to the previous year.
And they wanted your most recent
corporate tax returns and whether
or not you had subsidiaries that did not
file separate tax returns.
The distributions were intended
to go out within 10 days of the application
but there have been delays.
They're still sending money out the door
and some people have been asked
to resubmit some of their details.
So there have been a few glitches.
But unfortunately if you got a small
round one distribution and didn't apply
for round two, you've sort of lost out.
Round two is where you are supposed
to make up whatever you didn't get in round one
because you had low Medicare Fee For Service billing.
So the total that you are supposed to get
from these two rounds is about 2%
of your 2018 all-payer revenue.
That's not a huge sum of money,
but it's significant, it's about a weeks worth
of revenue.
Let's go to the next slide.
So you know one of the concerns people had
was well gee what if my estimate was negative
and I got more in the first round than my 2%
of all-payer revenues?
HHS really considered three factors here.
One was how much they gave you in the first round
which was about 6.2% of your 2019 Medicare
Fee For Service revenue.
The second was this estimate which was 2%
of your 2018 gross receipts.
And the third really was the key
which was your March and April 2020
lost revenue or increased expense compared to 2019.
So if your March and April lost revenue
was greater than the first distribution
you're eligible for a second payment
and you should have applied through the portal.
If the lost revenue was less than you got
the first time around they actually wanted you
to return the money, submit your financial
information through the portal
and they would figure out the correct amount.
HHS does say that they want unused PRF money
to be returned voluntarily.
So if you haven't had lost revenue
matching what you got, they want you
to give the money back.
And they reserve the right to audit recipients
and demand return of inappropriately used funds.
But they don't look to be recouping money
for those who received more than 2%
of their 2018 gross receipts
so long as your lost revenue exceeded
the amount you got.
Next slide.
So there were similar eligibility, use of funds,
and prohibitions, that were attached
to the second round as attached to the first round.
They did add to the reporting requirement
that they wanted your 2018 general revenue data.
And they announced that there would be
public disclosure of the PRF payments
which would allow anyone to estimate
what your 2018 gross receipts were
by multiplying it by 50.
And again they said that you have accepted
the terms and conditions if you keep the money
even if you didn't contact HHS.
Next slide.
So now were into the third round
which is a targeted 15 billion dollar distribution
which is aimed at Medicaid and CHIP providers.
And the portal for applying for this third round
opened on June 10th.
There are six eligibility criteria.
And the first one is that you didn't get
any money from the first or second round,
from the General Distribution.
So really this is for people who had
no Medicare Fee for Service revenue.
We have to have billed, or owned a subsidiary
that billed Medicaid in 2018, or 2019.
You have to have a tax return
for either 2017, 2018, or 2019 or be exempt from filing.
You have to have provided patient care
after January 31st.
And have not permanently ceased providing patient care.
So if you shut down because of COVID-19
but you're planning to reopen,
or you have reopened, you're eligible.
And for individuals you have
to have available your gross receipts
from providing care from a 1040
or a Schedule C, exclusive of any W-2 income.
And the application deadline
for this distribution is July 20th.
Next slide.
So where do you go to attest, apply,
report, obtain more information, complain?
The first link here is the landing page
at HHS which has links to all the
Provider Relief Fund portals,
and application instructions.
There's also a link here for a
Provider Relief Fund FAQ,
which is updated weekly, sometimes more often
and contains changes with details.
And finally this a phone number
to United Health Group which is distributing the funds
and this is their hotline for questions
and the number there is 866-569-3522.
And I think that wraps it up.
-: Great, so David and Scott thank you very much
for those updates.
I think it's important for everyone
to recognize these are updates as of this evening.
Who knows what we'll see this week
or later next week as things change.
We will continue to update our online Q & A
to be consistent with those new regulations.
Additional questions please feel free
to send those along to healthpolicy@aao.org.
So we're going to move to the question
and answer portion of the program.
And thanks for people getting us started.
The first question I think is important.
Scott for the PPP, can you do only eight
or 24 weeks, or can you choose anything in between?
-: Wow that's a great question.
So my interpretation of the rule
that came out from Treasury is
that it's an either or situation.
So you can't sort of choose your own
interval between the two.
Obviously if we hear anything else
we'll put it out to the membership
so that they know.
But right now you know my recommendation
would be either stay with the eight week
cover period that had been policy
predating June 3rd.
Or if you want the flexibility
to go with the 24 week.
But choosing you know 16 weeks
or 12 weeks from my interpretation
is not what they're allowing.
-: Right, so Scott it seems to me 24 weeks
you simply have to spend the money
during a finite period. -: Right.
Just have 24 weeks is just how you
do the accounting for it
and it should be easier to spend
even if you spend it all in
the first nine weeks I suppose?
-: Yeah, and I would imagine that you know
the SBA and Treasury they're reviewing
the non forgiveness applications
and so they want it to be a finite period
especially to make it easy on their end.
And not have you know individuals
submitting loan forgiveness requests
that range anywhere between eight and 24 weeks.
But again, if we hear anything different
we'll certainly be letting members know.
-: Okay, so we have to make the banks happy
because they have the paperwork to do
I guess Scott. -: Right.
So the next question is paperwork question.
So some people who were the earlier applicants
for the PPP have actually gone through
their eight week period by a few days
and now have to apply for loan forgiveness.
What do we know about the banks being ready
to accept the loan forgiveness documentation?
-: Yeah, so you know in this example
and if you've already spent all the funds
and are more or less ready
to submit the information to have the loan forgiven,
I would go ahead and do it.
I don't think we can anticipate changes
that would you know provide any positive benefit
for someone to wait to submit the application
for forgiveness.
And I don't think we anticipate Congress
doing anything that would potentially
they would miss out on some sort of benefit.
So I would say if you've already spent the funds
from the loan and you're ready
to apply for forgiveness to go ahead
and get those applications in.
-: Scott, I was wondering, or maybe this
is wishful thinking, do you think
that Congress might let that's have a new
multiple of weeks of unemployment
in other words that 2.5 multiple
that you had for payroll to cover the
eight week period.
What about a bigger multiple to allow more weeks
of Payroll Protection?
Any rumbling on the hill for that one?
-: No, I mean there's been,
because there is a lot of money
that's remaining in the fund,
and certainly there was a hearing last week
that we monitored to see if there was
any news out of, they're considering a host
of things related to PPP.
But I would consider them to be new endeavors
and not anything that would mess
with the flexibility that's already been provided.
So an example would be you know there's been
discussions about you know giving really
hurt businesses you know a second PPP loan
or a more targeted loan that would maybe
given them four weeks.
But I think that kind of thing would require
another application, another law being passed.
So I don't think there's anything
that's going to come out via guidance
in the next week or so that's going to change anything.
-: Great, thanks.
So another question, and I think this is
probably how the, this is really going to
be lender specific is that can I ask
for forgiveness, I guess between eight
and 24 weeks if I use the funds up
by 12 weeks.
And I guess that depends on what the lender
portal is when they're willing
to accept the forgiveness application
which they then have to send over to SBA?
-: Right, I mean if you've stopped
with the eight week cover period
you know you've met the existing regs
of spending at least 60% on payroll
and you're ready to apply for maximum forgiveness.
If you've already done that
then you should go ahead and speak
with your lender when to submit
the application for forgiveness.
Like I said, I don't think there's any
benefit in waiting to the 24 weeks.
I would just go ahead and you know try
to get that ball rolling, if you will.
-: Right, so that's probably going
to be lender specific right now
while they're coping with the applications
at one end trying to get SBA to process.
As I understand it, this is sort
of an application to the lender
who then sends it to SBA
and they wave a magic wand over it
and then send money back to the back who
then tells you your loan's forgiven.
-: Right.
-: Your loan is not forgiven.
Okay so the next question is,
if my (laughs) yes, this firmly
in the press right now.
If my employee is making more money staying
unemployed how long will the add-on $600 last,
and where is the incentive to be rehired?
And certainly that is a question
that the Congress has been talking about
and the press have been talking about.
Because as some of you know there's also an ask
to have more, or extend the $600 period.
And I guess the one thing I would say
and then I'll let Scott or David.
Is that what we know if your employee
won't come back you still get credit
for offering the job.
And it doesn't penalize you in your application
for forgiveness. -: Right.
And whether you rehire that person is sort
of up to you in the future
which is sort of a half answer
as best I can add at the moment.
David, what do you think?
-: Well I agree with you Michael.
I think the answer in terms of PPP loan forgiveness
is not a problem so long as you document
that you offered the job and they didn't take it.
In terms of the real world issue
of how are you going to (mumbles) hire
your staff I don't think I have a magic answer there.
-: Yeah.
So the next questioner wants to get rid of MIPS MACRA
and yeah there are some days
where everybody would like to get rid of MIPS MACRA.
For the moment, of course ophthalmology
has been very successful in those programs
which may sound sort of disingenuous
because people are spending a lot
of effort and time on the staff
to fill out those questions.
And so I'm thinking for those
where there is no work, the IRIS Registry people,
it's hard to give away that money
but I recognize the problem we have
for the web-based and the portal entries.
And it's certainly something
that we have been talking about how
to handle those cloudy programs
because where they're a burden,
we shouldn't have that burden.
Okay.
So this one is, employer contributions
to a profit sharing plan for employees,
is that a payroll expense that's eligible
for forgiveness under the 60% payroll Scott?
And then of course there's another question
about the employer contribution for the employer.
So two things, one is profit sharing
for the employees, and profit sharing
for the employer.
And HHS, or SBA has talked about that.
-: Yeah, so there's very limited things
that they add on specifically
that are going to be eligible for them.
A lot of it is contributions to retirement,
you know specifically matches on 401K.
I haven't seen anything on profit sharing
but that's certainly as question
that I'll look into and we'll put
a clear answer up on the website on our FAQ.
There's a lot of things that we've,
a lot of the question that we've got
since the program launched is about
eligibility about specific things
with practices due to provide various benefits.
And it's just an issue of there's just a lack
of clarity about each and every individual thing.
Other than broad things like,
you know reimbursement for retirement and so forth.
-: Yeah, it's likely that would be capped
under the weekly percentage
that you're allowed to give an employee
which is the 5,000 where that fraction
over $5,000 a week is.
-: Which makes me think that this is not going
to be covered because it just is going
to run into issues regarding like the payroll
and having individuals sail over that 100K cap,
at least some individuals.
-: Okay, all right.
So the next question I haven't had a chance
to read carefully so I'm hoping you guys have.
So you're compensation under PPP was
of course capped at 100,000 annually
then done by week, so divided by the number
of weeks to get the number of dollars
which I think somebody has listed here
at 15,385.
Does the expansion of time allow you
to expand those dollars?
-: So we do not know the answer to that yet
but I know that Treasury's going to issue
guidance on that specific point
because that's been a common question.
So that's something that we'll put either
in for the daily newsletter WRE,
or up on the website.
Because that's been a very common question
because it would make sense
that they would boost it up
for you to be able to go beyond
that roughly $15,000 mark.
But we'll make sure we get an answer out
to that question as soon as possible.
And Treasury will issue the guidance.
-: Yeah, one thing I was going to say,
Scott mentioned the questions and answers.
The questions that come up on these seminars
we've provide to House Committees,
to staffers in Treasury.
And they've been added, perhaps not just
because of us, but they've been added
to the weekly updates we get from the agency.
Because they are listening and they recognize
they roll programs out with a really a skeleton
that you probably could not have walked on,
you certainly could not have stood up on.
And so the questions are important.
These programs, and so this goes both
to David and Scott.
Are these Relief Funds or loan forgiveness
taxable income to the practice or to the provider?
-: Oh I think the answer to that is
it'd best be answered by your accountant.
But in general, free money you know,
the grants likely to be considered taxable income
and the loans are not.
A forgiven loan probably would be
considered taxable income.
But that's a question that each practice's
accountant's going to have to answer for them.
-: And my expectation is the employees would be
responsible for payroll taxes on the
money through those programs.
But Dave of course is right,
not one of us did anything more than
perhaps one or two accounting classes in our life,
I certainly did one tax.
All right.
It looks as if the interim, oh god I got to.
So one question (laughs) is a
very short questions.
If you use monthly payroll.
Oh, so payroll period.
I remember in the first week it was like
gee my payroll period's not congruent
with the disbursement date of the loan,
everything is going to blow up.
We've had guidance on that.
The payroll period can be adjusted.
-: Yeah, so I can answer this.
I mean unfortunately when they issued guidance
providing this alternative payroll,
it looks like they drilled the benefit
to make it to where if had a bi-weekly
or more frequent payroll that you could create
sort of an alternative period,
and that would provide you benefit.
Unfortunately that's not going to apply in that case
because it's on a monthly payroll.
So you know this is an issue
of there's certain things that are coming out
via guidance that some borrower
or some of our members are going to find
that beneficial and other are going to find
that sort of the benefits aren't being
provided to them just because
of how their payroll's set up.
-: Right.
So another good question is,
the FTE equivalent calculation.
So there are all kinds of ways you
calculated FTEs in these programs and the PPP.
But the two dates were you had a Scott,
the initial period which was one
of, periods to get your FTEs for your payroll.
And then the FTE and on June 30,
we're now December 31st.
But they have two different purposes
and maybe you could explain those again.
-: Yeah, so what they've done with the passage
of the most recent law, the Flexibility Act,
is keep that rehiring date back
to December 31st.
And the reason why they did that is there
are a number of borrowers who got loans
and the covered period whether it be eight
or 24 weeks was going to extend beyond
that June 30th date that they had outlined
in the initial bill, the initial CARES Act
there was a period of February 15th
to June 30th that was supposed to sort
of encompass the entire program.
And so they've moved back
that rehiring date to allow individuals,
or borrowers who got loans
that are going to extend beyond June 30th
to still be able to rehire individuals
and sort of cure the FTE issues
and still get maximum forgiveness.
So that's an important change.
-: Right, so practically Scott,
that means that suppose I was thinking I had
to have everybody onboard at the end of June,
now I have the date of December 31st
so I really should not max my staff
if I don't need them, I should say.
All of these reductions are in the
I don't need them kind of thing.
So the idea here would be now you don't have
to ramp up for June 30, you have until the end
of the year to have your full time
equivalence on payroll as of the last day of the year.
So people that's a really important flexibility
that comes a little late for some people.
Okay, if we got a PPP loan from one bank
can you go get additional money from another bank?
-: Unfortunately not.
And there's another question about whether
or not there a second round of PPP.
I mean right now if you have received a PPP loan
from one bank, you are you know in essence maxed out.
Barring any legislative change
that would enable practices and other businesses
to get a second PPP loan,
each borrower is only able to have one.
-: Yeah, that, and again, please everybody
stay aware if they change the rules on
the amount of PPP money,
because there is some pressure there.
So another correspondence says I never applied
for round one Relief Funds,
are you out of luck going forward?
And I think that's a question David should answer
but I'm worried about how that's being
interpreted and what's going on for that doctor.
-: Yeah, so round one did not require
an application, that went out automatically
to anyone who had Medicare Fee For Service
revenue in 2019.
Round two required an application by June 3rd
and that was for people who received
round one money that needed more
because the goal was to send out about 2%
of your 2018 all-payer revenue.
So if you didn't have much Medicare revenue,
you wouldn't have received much in round one.
So those people their job was to apply
by June 3rd for round two.
Round three is open now but that's only
for people who had zero Medicare Fee For Service.
So if you received anything automatically
in round one you cannot apply to round three.
If you got zero in round one,
you are not eligible to apply to round two
but you should now apply to round three.
-: Yeah, so there is another question here.
Has there been more than one distribution already?
And just to reiterated what David said,
distribution one is done.
Distribution two is under way.
And distribution three is in the application
process at the moment.
And if you are eligible, please don't miss out on it.
Somebody asked whether there'll be,
how they'll be able to submit their
quarterly data to report on their use?
And David I don't think we know exactly how,
but I would assume it's going to be some kind
of electronic portal?
-: Yeah that's how they've handled everything else.
So I think the assumption is there will be a FAQ,
or a direction, or an instruction online.
And when we learn of it we will put
it up on our website and send out information
on how to do that.
-: Okay, couple important questions here.
Again this is regarding the 24 week period
and maintaining FTEs for the full 24 weeks.
You don't, I mean you are certainly welcome to,
but to get, again, this is about loan forgiveness
not about what you need in the practice.
You only have to have your FTEs
at the threshold at the end of the year
on December 31st now.
So that would be an important change in the program
as opposed to what had been June 30.
Now if you're done on June 30
and you're back to full speed ahead,
there's no reason you can't complete all
of that information for the lender.
Scott what about health insurance premiums,
are they forgivable expenses?
So this would be in the non payroll portion,
that 40% of the expenses.
I assume they don't qualify as payroll?
-: Well, I don't think they are going
to fall into payroll.
But I'll look at that and if there's any
issue where we need to issue clarity we will.
-: The other things that can occur, Scott,
are in the non payroll category,
are things like rent, and--
Scott: Right.
-: And sort of business related expenses
which this might also be in.
Okay this is the common question.
If a CARES payment, and I'm guessing this
would be the Provider Relief Funds,
was greater than the 2% that HHS intended.
And so I assume this doctor got it
in the round one.
Can we expect a request to return some of the funds?
David do you might want to try that one?
-: Sure.
So I think the answer is we don't know for sure.
But there have been some musings in the HHS FAQs
that suggest they're not going
to receive recoupment if you had
losses in revenue that were greater
than the amount you received.
So if you submitted for round two,
through the portal, and you're losses
from 2019 to 2020 were greater
than the amount you received,
I think you can relax.
If you submitted through the portal
and your losses from 2019 to 2020,
those March and April losses,
were less than the amount of money you received,
I think you're in limbo.
I don't think they're going to come after you
but they could.
And we don't know exactly who, or how, or why.
If you didn't apply through the portal at all
and they don't have any of your data
as to what your losses were,
who knows what they're going to do.
They might decide that one of the items
that everyone has to report to ensure
that they're in compliance with the program,
is either their 2018 gross receipts,
or their lost revenue.
So it's a bit of a gray area,
but the information that's come
from HHS has tended to be some what reassure.
-: Okay, great.
Does monthly maintenance on a coop
can be forgiven under the 40% Scott?
-: No, that's not going to qualify.
-: All right.
Is it true you cannot receive PPP and EIDL funds?
And I think that's not true.
I think that EIDL amount -: Right.
of loan forgiveness is affected
by the EIDL grant.
-: Right, they're going to subtract
whatever you got in the EIDL grant
from your eligibility for PPP forgiveness.
So if you a $10,000 EIDL grant,
you're going to be eligible for $10,000
less in PPP forgiveness.
And that's going to apply on a dollar dollar
for basis so if you got a $5,000 grant
they're going to deduct $5,000.
-: Okay.
And another doctor applied for,
or received $3,000 from the EIDL program,
I don't know whether that was loan
or grant money.
And the question is, can I apply
for more, or reapply for more money?
I don't know the answer to that.
I would assume now that they have money
they may be more willing to give money out.
It sounded like before Scott,
they were reducing the amount they gave
to anybody because they were running out of funds.
-: Right, yeah.
I mean if it was a grant,
if they got a $3,000 grant it's not an issue
of them applying and being able
to you know get bumped back up
and get $7,000 more and get up to that $10,000 cap.
Not only that, but there's such a log jam
of applications for the EIDL loans
that at this point anybody that's sort
of applying again is so unlikely to get funds.
I think if individuals are looking
to get an EIDL loan they should apply
as soon as possible, many have had some success.
But that program has had a lot of challenges.
I mean they abruptly just cut off applications
in the middle of May which was unexpected.
So I wouldn't anticipate being able
to apply again, or get additional grant money
if you've already gotten some.
-: Yeah.
Another question is about the reporting requirement.
If you get $150,000 or more in grants
or loan forgiveness, then you do have
to do the quarterly reporting.
It's not really due to the arithmetic
of the 6.2% or 2%, it's cumulative
in all of those programs.
Do we expect the HEROES Act to pass
so that the Advanced Payment and Relief Funds
will be, I should say the CMS Advanced
or Accelerated Payments will actually occur?
We don't know, I don't know what the chances
of that are for passing.
You know with every passing week I suppose
they're a bit lessened.
But the politics of it we're trying
to get that improved because that would
really help cash flow with a decent
interest rate, and a decent repayment period
for a lot of practices.
What if I've not received a Provider Relief Fund
check, at least that's how I'm reading this one?
And the individual has contacted their Senator,
which is always a good place to go.
Probably send a note to our website
so that they can have the details
and perhaps make sure we've got that right
and then we can work that.
Another person has a problem with,
I assume this is the portal, for Relief Funds,
and got a notice back that their application
had been voided due to an expired envelope
and they of course wondered what that meant.
And I of course have no idea what that means.
But that's another one we'll have
to be certain of.
The only thing I would ask you is
which make sure we knew you were applying
to the portal number two for the Relief Funds.
-: The other thing we could do for both
of those people is you could trying
calling the UHG hotline at 866-569-3522.
They may or may not have an answer
for you depending on the knowledge
of the person who picks up the phone.
-: Okay.
Two last questions that are somewhat related.
Can you go back to bank on the PPP
since the rules have changed dramatically
to ask for more money?
And I'll just say quickly
that under the current rules they didn't
change how much money you could get
that is the multiple of your payroll.
So you're still talking about the same amount
of money you are eligible.
And as far as I know there is no
reapplication process, no second bank
under the current rules.
Obviously people are talking about that
and we will see.
Can you discuss the rules concerning FTEs
as it impacts loan forgiveness of the PPP.
So Scott you want to summarize where a person has
to be on June 30th or on December 31st
with their FTEs?
-: Yeah, so when you have the reductions
in the FTEs it's going to impact your
forgiveness if you don't cure them
by then end of your covered period
which now is December 31st.
You know originally you were only going to have
until June 30th to get the employees back at work
and back sort of at that existing level
of where your FTEs were prior to the COVID emergency.
If you can't get all of your employees back
you know one of the things we talked
about earlier in the webinar was
if you issue a you know a written request
from one of your employees to come back
and they decline, which we've heard
from a lot of members.
As long as you have documentation
of that you should be fine.
But what you're trying to achieve
to get to maximum forgiveness is
to reach back to that level
that you were when you applied for the loan
of what your current level of FTES were.
So if you had 10, you applied for a loan,
but now you only have eight at the end of the period,
it's going to impact your forgiveness.
It's not going to eliminate your ability
to get any, but it will harm you.
-: And there if you calculate FTEs
on a 40 hour week, or a 37 hour week,
where is it okay either one okay
as long as you use the same calculation
from prior and post.
-: So my understanding is that they want you
to get that 40 hour level,
that's what they consider to be an FTE.
-: Yeah.
So unfortunately we've come to the end of the hour.
There are still many, many questions
that are in you and I and I apologize
for not speaking fast enough
to get through all of those questions.
Some are very, very good.
Reach out to us, we will try
and reach out as we can.
I just want to make one last plea
for the third trench of this targeted money.
If you got nothing in round one
because you had no Medicare Fee For Service,
please go to the portal and sign up
for the money that's based upon your non,
well it's based on all-payer revenue
and you'll get the same share
of course based upon different fee schedules
but still you'll get a portion
of the money, your 2% of your revenue.
And so it's an opportunity
that simply cannot be missed.
And I think too many people may have missed
applying in round two.
-: July 20th is the deadline for that the third round.
-: Say that again David please.
-: So the deadline for those who got
nothing in round one, the deadline
for round three is July 20.
-: Yeah, key number.
Hopefully they'll let us get back out
on this before that.
But I want to thank the panelists for helping.
The questions are terrific.
The problems are greater.
And we're very pleased to use those questions
to get guidance from the agencies
as well as for other members who
did not know to ask that question
about these programs.
So I'd like to thank the staff
for putting it on, and David and Scott
for joining me tonight.
I wish everybody the best,
and have a good evening.
-: Thank you Michael.