Today, Congress has passed another stimulus bill (H.R. 6322) that infuses billions into the now-depleted Paycheck Protection Program (“PPP”).
The latest stimulus bill also provides billions to hospitals and other health care providers who have been impacted by COVID-19. Additional funding for COVID-19 testing development and supplies is also appropriated.
The bill has passed the House and Senate and needs only the President’s signature before becoming law. President Trump has already tweeted his support of the latest stimulus package, so his approval is expected shortly.
$310 Billion in New PPP Funding
A week after running out of money, the new stimulus bill provides an influx of $310 billion to the Small Business Administration’s now-depleted PPP. The program depleted its original allocation of $349 billion, so the latest funding nearly doubles the size of the program. After complaints that the money was diverted to large financial institutions, $60 billion of the new funds are set aside for smaller lending institutions.
The bill also provides $60 billion in Economic Injury Disaster Loan Program (“EIDL”), including $50 billion in loans and $10 billion in grants.
Those organizations that missed out on the first round of PPP and EIDL funding should contact their lending institutions and see if they need to take any additional steps to have their loan applications funded.
$75 Billion in Aide to Affected Hospitals and Providers
The bill allocates $75 billion for “eligible health care providers,” which are defined as “public entities, Medicare or Medicaid enrolled suppliers and providers, and such for-profit entities and not-for-profit entities not otherwise described in this proviso as the [HHS Secretary] may specify, within the United States (including territories), that provide diagnoses, testing, or care for individuals with possible or actual cases of COVID–19.”
According to the bill, eligible providers may request funds for any of the following purposes, including “lost revenues” that are attributed to COVID-19:
[T]o prevent, prepare for, and respond to coronavirus, domestically or internationally, for necessary expenses to reimburse, through grants or other mechanisms, eligible health care providers for health care related expenses or lost revenues that are attributable to coronavirus . .
. . .
[F]unds appropriated . . . shall be available for building or construction of temporary structures, leasing of properties, medical supplies and equipment including personal protective equipment and testing supplies, increased workforce and trainings, emergency operation centers, retrofitting facilities, and surge capacity . . . .
The funds cannot be used to “reimburse expenses or losses that have been reimbursed from other sources” and HHS will provide guidance on the necessary documentation.
The funds are available on a “rolling basis,” so eligible providers should act quickly to request available funding.
$25 Billion for COVID-19 Testing
The new bill also provides $25 billion in funding for research, development, manufacturing, and purchasing of COVID-19 tests. Of that funding $11 billion is reserved for funding state testing programs.
While the bill earmarks $11 billion is reserved for funding state testing programs, the bill does not contain additional state funding requested by democratic negotiators.
Bottom Line
This bill represents the latest chapter in stimulus funding relating to the COVID-19 crisis. Organizations should consider whether to take advantage of the SBA’s PPP and EIDL funding and should work with counsel and their accountant on maximizing the value for their business.
In addition, health care providers who have been impacted by COVID-19 should pay particular attention to this bill and take steps to access the $75 billion in funding. These funds could help defray the significant losses that hospitals and other health care providers have sustained as they have braced for an influx of COVID-19 patients.
We will continue to monitor this new legislation as it unfolds.