|On 06/03/2020, the US Senate passed the Paycheck Protection Plan Flexibility Act and is sending it to the President for his signature. We expect the President will sign this bill that will assist chiropractic physicians who have obtained or will be obtaining a PPP loan. The legislation makes the following changes:|
Extends the 8-week forgiveness period to 24 weeks. This will allow employers more time to offset the loan amount with payroll expenses. In other words, employers can now use payroll expenses for the entire 24-week period and increase their forgiveness amount.
Reduce the payroll expense requirement from 75% to 60%. However, if employers do not use at least 60% for payroll expenses, then none of the loan will be forgiven. This is unlikely with the changes mentioned above.
Employers can now use the entire 24-week period to restore their workforce to the pre-COVID-19 era (February 20th, 2020) levels.
It allows for additional forgiveness exceptions. It specifically codifies the “good faith offer to return to work” exception. Then it adds other exceptions for those businesses that cannot find qualified candidates or those that can never return to pre-COVID-19 levels as a result of the pandemic operating restrictions.
It extends the term of the loan from 2 years to 5 years. For those loans already in place, the term can be extended if both the borrower and lender agree.
It also allows for PPP recipients to delay payment of payroll taxes that were previously restricted in the CARES Act.
A few weeks ago, we informed you of a new round of Provider Relief Funds that were becoming available. If you received the initial HHS funding in April, you qualify to apply for the second round of funds. You will have to apply and include information from your 2018 tax return. Today we are hearing from doctors that have gotten their second round of money. If you have not applied yet, there is still time.
HHS has begun the next round of payments under the Provider Relief Fund. This round is $20 billion and is based on your net revenue in 2018 against the entire estimated healthcare net revenue amounts from 2018 (some estimating $2.5 trillion total). Additionally, most providers are required to submit information via a portal to receive their portion of the $20 billion.
To receive your funds, you must submit your application through the portal. You can find the link for the general distribution application portal on the Provider Relief Fund page or by direct link here.
According to the General Distribution portal FAQ, HHS is collecting four pieces of information for use in allocating these remaining General Distribution funds:
- a provider’s “Gross Receipts or Sales” or “Program Service Revenue” as submitted on its federal income tax return;
- the provider’s estimated revenue losses in March 2020 and April 2020 due to COVID;
- a copy of the provider’s most recently filed federal income tax return; and
- a listing of the TINs any of the provider’s subsidiary organizations that have received relief funds but that DO NOT file separate tax returns.
Like the first $30 billion, these funds can be used to cover additional COVID-19 expenses OR lost revenues. Thus, if you had lower revenue in March and April that are greater than the funds received from HHS from the initial disbursement and this disbursement combined, that will satisfy the usage portion of the requirement.
Today the official guidance for massage therapy to reopen was released on the Healthy as Work Website. The full document can be reviewed here.
The official guidance released today has changed from the guidance that was released earlier from the massage therapy board. Below are the highlights of the requirements to reopen massage therapy. Please ensure you read and fully understand the full guidance if you utilize massage in your practice.
Massage therapy businesses should eliminate the use of any waiting areas, provide services by appointment only, and communicate when the client may enter the premises by phone or text. Massage therapy businesses must ensure clients do not congregate before or after their appointment.
Given the close personal interaction inherent in massage, massage therapy businesses should consider screening potential clients over the phone to ensure they are not currently experiencing any symptoms of COVID-19. Massage therapy businesses also may take temperatures of clients upon entry. Massage therapy businesses may refuse service to someone who is exhibiting COVID-19 symptoms
Massage therapy businesses should ensure that their facilities, including workstations, common areas, breakrooms and restrooms and are properly cleaned and ventilated.
Massage therapy businesses must ensure that massage tables are sanitized and that linens and hydrocollator pack covers are replaced after each client.
Massage therapy businesses should ensure that lotion/lubricant bottles are disinfected before and after each client or should consider using disposable lotion/lubricant packets.
Massage therapy businesses must ensure their employees wear face masks for any interactions between clients and co-workers or while in common travel areas of the business (e.g., aisles, hallways, stock rooms, breakrooms, bathrooms, entries and exits). Employees are not required to wear face masks while alone in personal offices, more than six (6) feet away from anyone else, or if doing so would pose a serious threat to their health or safety.
Massage therapy businesses should consider lining tables, table warmers, bolsters, face, cradles, and pillows with non-permeable barriers, such as vinyl mattress pad covers.
Massage therapy businesses should apply a washable face-cradle cover to the face cradle, and consider topping it with a pillowcase, leaving a pocket underneath that could catch client aerosols when they are prone.
Massage therapy businesses should ensure clients and other visitors (e.g., suppliers and vendors) wear face masks while on the premises unless doing so would present a serious risk to their health or safety or they will remain more than six (6) feet away from anyone else at all times. Massage therapy businesses should make masks available for clients; however, clients may bring and utilize their own face mask if they wish. Massage therapy businesses should consider asking clients to keep the mask on at all times other than while in the prone position on the table. If clients, suppliers or vendors refuse to wear masks, the massage therapy business may, at their discretion, refuse those individuals entrance.
Massage therapy businesses should establish a policy as to whether to serve clients who do not adhere to the business’s policy to comply with CDC guidelines.
Massage therapy businesses must require employees to wear gloves anytime they are touching a client’s face and the gloves must be immediately removed or replaced after they are no longer touching the client’s face. Massage therapy businesses may require employees to wear gloves in other instances, but gloves are not required provided the massage therapist refrains from touching their own face while massaging the client and thoroughly washes their hands for at least twenty (20) seconds per CDC guidelines before and after touching each client.
Some doctors have had concerns about the requirement to satisfy the certification indicating that the “[c]urrent economic uncertainty makes this loan request necessary to support the ongoing operations of the Applicant.” As a result, some doctors have been concerned about future audits and even consider returning the funds. However, the Treasury Department released new information regarding audits, good-faith certifications, and safe harbors on 5/13/2020 that should give our PPP recipients relief.
SBA has now clarified, in FAQ #46, that anyone receiving PPP “loans” less than $2 million would have less access to adequate liquidity in the current economic environment. Thus, they are considering all PPP loans of less than $2 million automatically meet the required certification of necessity. Additionally, they cited that this will also allow them to focus their limited resources to larger loans.
This should give all of our doctors who received PPP loans (assuming they are less than $2 million) comfort that there will be no necessity audits for PPP loans and do not have to be concerned with the return of funds.
46. Question: How will SBA review borrowers’ required good-faith certification concerning the necessity of their loan request?
Answer: When submitting a PPP application, all borrowers must certify in good faith that “[c]urrent economic uncertainty makes this loan request necessary to support the ongoing operations of the Applicant.” SBA, in consultation with the Department of the Treasury, has determined that the following safe harbor will apply to SBA’s review of PPP loans with respect to this issue: Any borrower that, together with its affiliates,20 received PPP loans with an original principal amount of less than $2 million will be deemed to have made the required certification concerning the necessity of the loan request in good faith. SBA has determined that this safe harbor is appropriate because borrowers with loans below this threshold are generally less likely to have had access to adequate sources of liquidity in the current economic environment than borrowers that obtained larger loans. This safe harbor will also promote economic certainty as PPP borrowers with more limited resources endeavor to retain and rehire employees. In addition, given the large volume of PPP loans, this approach will enable SBA to conserve its finite audit resources and focus its reviews on larger loans, where the compliance effort may yield higher returns. Importantly, borrowers with loans greater than $2 million that do not satisfy this safe harbor may still have an adequate basis for making the required good-faith certification, based on their individual circumstances in light of the language of the certification and SBA guidance. SBA has previously stated that all PPP loans in excess of $2 million, and other PPP loans as appropriate, will be subject to review by SBA for compliance with program requirements set forth in the PPP Interim Final Rules and in the Borrower Application Form. If SBA determines in the course of its review that a borrower lacked an adequate basis for the required certification concerning the necessity of the loan request, SBA will seek repayment of the outstanding PPP loan balance and will inform the lender that the borrower is not eligible for loan forgiveness. If the borrower repays the loan after receiving notification from SBA, SBA will not pursue administrative enforcement or referrals to other agencies based on its determination with respect to the certification concerning necessity of the loan request. SBA’s determination concerning the certification regarding the necessity of the loan request will not affect SBA’s loan guarantee.
Today during the KBCE meeting, there were several items discussed. We will be creating a meeting recap that will be posted on the KAC website next week. One item of note that we would like to inform you of is a change to the Continuing Education (CE) requirements for the 2021 renewal.
KBCE voted today to issue emergency regulations that will allow all 12 hours of CE to be obtained online for the 2021 license renewal period. This is a departure from their current policy of allowing no online CE hours. Courses will have to be approved through KBCE, but you will start to see online CE hours approved for Kentucky. The KAC is taking steps to provide online continuing education hours that will be approved and allowed for renewal. These will include our Annual Convention and the 2021 LB Payne Insurance Seminar.
We are waiting to see the official language for this new regulation. Based on the discussions at the meetings, we anticipate these changes going into effect next week. We will continue to monitor the situation and update you as this evolves.
Based on guidance that has
been posted on the Kentucky Board of Licensure for
Massage Therapy (KMT) website, licensed massage therapists (LMT) may reopen on May
25th. They do have a six-page document with guidance for how this reopening
will occur. This guidance is very detailed, and if you offer massage therapy
services in your office, you need to understand the guidance fully.
We do not have any further information at this time pertaining to this guidance. Any questions should be directed to the Kentucky Board of Massage Therapy or the Kentucky Massage Therapy Association.
Read the entire reopening guidance located on KMT.
There continues to be many questions and concerns around the forgiveness of the PPP loans. Below is an overview of the forgiveness language and also new guidance that has been released this month that intends to further clarify your responsibilities under PPP for forgiveness. Keep in mind this guidance continues to change and develop. We will continue to provide any new changes as they happen.
- Section 1106 of the Act, titled “Loan Forgiveness,” provides that the Government will forgive up to the original principal amount of a loan under the Act that a recipient can document was used to pay: (1) payroll costs; (2) mortgage interest; (3) rent and (4) utilities—in each case for up to eight weeks following the issuance of the loan. Additional details:
- Like the loan amount, the forgiveness will be proportionately reduced for salaries greater than $100,000.
- Each of these documented expenditures for utilities, lease payments, mortgage interest must have been in place prior to 2/15/2020 (i.e. no mortgage interest can be included if the mortgage began on 2/25/2020).
- Employees must remain employed through the end of June.
- Employee pay cuts greater than 25% will reduce the forgiveness proportionately.
- [Updated 5/5/2020] The SBA recently changed their information sheet and removed the specific information regarding full-time equivalent hours. See the next bullet for that information. According to the SBA, forgiveness requires the following:
- “Number of Staff: Your loan forgiveness will be reduced if you decrease your full-time employee headcount.
- Level of Payroll: Your loan forgiveness will also be reduced if you decrease salaries and wages by more than 25% for any employee that made less than $100,000 annualized in 2019.
- Re-Hiring: You have until June 30, 2020 to restore your full-time employment and salary levels for any changes made between February 15, 2020 and April 26, 2020. “
- The CARES Act provision regarding full-time employees references previous IRS code (26 U.S. Code § 4980H(c)(4)(a)) that states “The term ‘full-time employee’ means, with respect to any month, an employee who is employed on average at least 30 hours of service per week.”
[Updated 5/4/2020] SBA and the Treasury Department released more information on the PPP loan forgiveness on 5/3/2020 and they answered questions that many of our doctors have. The clarification came in the form of a FAQ:
“Question: Will a borrower’s PPP loan forgiveness amount (pursuant to section 1106 of the CARES Act and SBA’s implementing rules and guidance) be reduced if the borrower laid off an employee, offered to rehire the same employee, but the employee declined the offer?
Answer: No. As an exercise of the Administrator’s and the Secretary’s authority under Section 1106(d)(6) of the CARES Act to prescribe regulations granting de minimis exemptions from the Act’s limits on loan forgiveness, SBA and Treasury intend to issue an interim final rule excluding laid-off employees whom the borrower offered to rehire (for the same salary/wages and same number of hours) from the CARES Act’s loan forgiveness reduction calculation. The interim final rule will specify that, to qualify for this exception, the borrower must have made a good faith, written offer of rehire, and the employee’s rejection of that offer must be documented by the borrower. Employees and employers should be aware that employees who reject offers of re-employment may forfeit eligibility for continued unemployment compensation.”
Based on this information, it appears that employees that refuse to return to work will not count against an employer for PPP loan forgiveness if the offer to return to work was:
- Made in good faith,
- In writing, and
- Employee’s rejection is documented by the employer (does not indicate signature required from the employee, just documented).
- If you have already laid-off employees, you can re-hire them once the loan is disbursed and count them toward the calculation.
- The loan forgiveness is not taxable income.
The IRS announced there is an additional employer tax credit that is available to SOME employers. The credit is equal to 50% of qualified wages, up to $5,000 per employee ($10,000 in wages at 50%), and will be applied against the employer portion of FICA (employers share of Social Security taxes).
To qualify, employers will have to meet several requirements:
- Employers that received Paycheck Protection Program (PPP) funds are not eligible and cannot take the credit.
- The business must have been affected by COVID-19 in one of the following ways:
- The business must have been fully OR partially suspended as a result of governmental orders, OR
- A significant decline in gross receipts and must demonstrate that decline is greater than 50% for the same calendar quarter in 2019.
The IRS has released the following information to assist understanding the program.
If you believe that you may qualify for this credit, the KAC urges you to contact your accountant or payroll processing company to determine your eligibility.
Tonight, new guidelines were released that impact your practice. The executive order issued today allows healthcare to reopen, including chiropractic, with stipulations to reduce the spread of COVID-19. Click Here To Read The Executive Order.
Below is the language that was changed today, giving us more guidance going forward.
In high-touch clinical settings (e.g., physical therapy, chiropractic care) healthcare workers directly manipulating the patient must wear single-use non-latex gloves when manipulating the patient in addition to enhanced hand hygiene compliance; any objects and contact surfaces used for clinical services must be sanitized and disinfected between patients. All necessary steps must be taken to reduce body to body contact (e.g., PPE gown, cloth barrier, technique selection);
The initial portion of this language is the same as prior guidance, but they did add the last sentence. Since the spread of COVID 19 is dependent on contact, this guidance is aimed to address the body to body contact that occurs with hands-on practitioners.
Based on the guidance as written, you should select techniques that reduce body to body contact when possible. If you do utilize a technique that requires contact other than with your hands, a gown or cloth covering would be required between you and the patient. The gown or cloth covering would be required to be disposed of or washed between patients. A few examples of situations that would require additional protection would be side posture manipulation, anterior thoracics and extremities requiring body contact.
Based on the guidance, a cloth covering could be a patient gown that is draped over the area of contact, separating you from the patient. This new guidance needs to be implemented in your office immediately. Strict adherence to the guidelines will help to minimize the potential spread of COVID-19 and a possible spike in the numbers.
In all phases, health care practitioners should still maximize telehealth rather than in-person services.
- Health care facilities should still not allow visitors except when necessary in end-of-life situations, or for vulnerable populations or minors, and even then, visitations should be kept to a minimum.
- Health care facilities should also eliminate traditional waiting room or common seating areas and use non-traditional alternatives, for example, a parking lot “lobby.”
- Health care facilities should maintain social distancing, keeping people at least six feet apart in all possible settings, and employ other steps to minimize direct contact between individuals within the health care setting.
Screening and Sanitization
- Health care facilities should screen all health care workers, patients and others for temperature and COVID-19 symptoms upon arrival for shift or visit.
- Staff should be required to stay home if sick.
- Staff should plan for and ensure enhanced workplace sanitizing, enhanced hand hygiene compliance, and easily accessible hand sanitizer throughout the facility.
Personal Protective Equipment (PPE)
- Each health care setting must be able to procure necessary PPE via normal supply chains.
All health care providers and staff must wear surgical/procedural masks and gloves while in health care office/facility.
- All patients and other persons in health care office/facility must:
- Wear a surgical/procedural mask while in health care facility
- Wear either a surgical/procedural mask or cloth mask/face covering in all other health care settings
- In high-touch clinical settings (e.g., physical therapy, chiropractic, etc.), health care workers should wear non-latex gloves in addition to enhanced hand hygiene practices described above.
- Any objects and contact surfaces used for clinical services should be sanitized between patients.
The KAC recommends that you have a strict adherence to the stipulations above. If you do not have the proper PPE, non-latex gloves and surgical/procedure mask, we would recommend not treating patients until all PPE is available. The governor did indicate that there would be enforcement of these stipulations as health care reopens.
The guidance indicates that all employees and staff should be screened for COVID symptoms upon arrival. We developed a tool for you to use based on the MayoClinic COVID-19 screening tool. Click here. The guidance does not indicate that the patient must complete a written form at this time. We would recommend maintaining a written document due to the lack of clarity in the current guidance.
The KBCE has also released a document with the current guidance available. Click Here