As we respond to the guidelines set forth by the CDC for specialty healthcare practices, we are seeing not only a downturn in patient volumes, but the real-life impact these measures are having on our teams and ultimately, on the health of our businesses.
Now that we’ve transitioned to telemedicine for patient care, we are doubling our focus on taking care of our teammates, and positioning our practices for success after the COVID-19 pandemic is over.
Today, the president signed into law the historic Coronavirus Aid,
Relief, and Economic Security (“CARES”) Act, a $2 trillion stimulus package to
provide financial assistance to the employers and employees reeling from the economic impact of COVID-19.
The bill was just signed today, but here’s what we’ve learned so
far about some of the components that may apply directly to dermatology
practices, especially those who have had to temporarily reduce their team due
to low patient volumes.
Immediate Assistance for Teammates on Furlough or Lay-off
- Expands unemployment insurance
from three to four months, and provides temporary unemployment
compensation of $600 per week, which can be applied for in addition to and
at the same time as regular state and federal UI benefits.
- Expands unemployment insurance from
three to four months, and provides temporary unemployment compensation of $600
per week, which can be applied for in addition to and at the same time as
regular state and federal UI benefits.
- Provides one-time checks of $1,200 to
Americans with adjusted gross income up to $75,000 for individuals and $150,000
for married couples. Individuals and couples are eligible for an additional
$500 per child.
- Unemployment benefits will vary by
state. More information can be found here: https://www.benefits.gov/categories/Unemployment%20Assistance
- Employers are eligible for a 50 percent refundable payroll tax credit on wages paid up to
$10,000 during the crisis. It would be available to employers whose businesses
were disrupted due to virus-related shutdowns and firms experiencing a decrease
in gross receipts of 50 percent or more when compared to the same quarter last
year. The credit is available for employees retained but not currently working
due to the crisis for firms with more than 100 employees, and for all employee
wages for firms with 100 or fewer employees.
- Employer-side Social Security payroll
tax payments may be delayed until January 1, 2021, with 50 percent owed on December
31, 2021 and the other half owed on December 31, 2022. The Social Security
Trust Fund will be backfilled by general revenue in the interim period.
- Firms may take net
operating losses (NOLs) earned in 2018, 2019, or 2020 and carry
back those losses five years. The NOL limit of 80 percent of taxable income is
also suspended, so firms may use NOLs they have to fully offset their taxable
income. The bill also modifies loss limitations for non-corporate taxpayers,
including rules governing excess farm losses, and makes a technical correction to
the treatment of NOLs for the 2017 and 2018 tax years.
- Firms with tax credit carryforwards and previous alternative
minimum tax (AMT) liability can claim larger refundable tax credits than they
- The net interest
deduction limitation, which currently limits businesses’ ability to
deduct interest paid on their tax returns to 30 percent of earnings before
interest, tax, depreciation, and amortization (EBITDA), has been expanded to 50
percent of EBITDA for 2019 and 2020. This will help businesses increase
liquidity if they have debt or must take on more debt during the crisis.
- Technical corrections to the
depreciation treatment of qualified improvement property (QIP).
Available Business Loans:
- Paycheck Protection Program – $350
billion in funding (included in Division A of the bill) for a Paycheck
Protection Program (PPP) that will provide small businesses and other entities
with zero-fee loans of up to $10 million, with up to 8 weeks of average payroll
and other costs forgiven if the business retains its employees and their salary
- Emergency Economic Injury Grants –
$10 billion in funding (included in Division A of the bill) for a provision to
provide an advance of $10,000 to small businesses and nonprofits that apply for
an SBA economic injury disaster loan (EIDL) within three days of applying for
- Economic Injury Disaster Loans (EIDL)
– $562 million to ensure that SBA has the resources to provide EIDL to
businesses that need financial support.
- Debt Relief for Existing and New SBA
Borrowers – $17 billion in funding (included in
Division A of the bill) for a provision to provide immediate relief to small
businesses with standard SBA 7(a), 504, or microloans, among other relief for
small business borrowers.
As this pandemic is impacting all part of the country, there has
never been a more important time to share, and to collaborate as a profession. Success
for one of us is success for all of us.