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Coronavirus Aid, Relief, and Economic Security Act

The soon to be passed Coronavirus Aid, Relief, and Economic Security Act includes these key details surrounding the Health Care Industry, Not-for-Profits, and debt restructurings. 

Health Care

  • $100 billion in direct financial aid to health care institutions (Special Public Health and Social Services Emergency Fund Allocation)
  • $1.3B for supplemental awards targeted to community health centers for detection, prevention, diagnosis and treatment of COVID-19 (Section 3211)
  • Medicare sequester countermanded – lifts related 2% reduction from May 1st to December 31st (Section 3709)
  • Medicare Hospital Inpatient Prospective Payment System add-on payment of 20% for COVID-19 patients during the emergency period (Section 3710)
  • Increasing access to post-acute care during the emergency period by waiving Inpatient Rehab Facility 3-hour rule to permit transfers out of the hospital facility to make room for COVID-19 inpatients (Section 3711)
  • Revising payment rates for durable medical equipment under the Medicare program by suspending planned reductions through the duration of the emergency period (Section 3712)
  • Importantly, revised payment rates for items and services on March 6, 2020 (and through the emergency period) from 100% of the adjusted payment amount to (i) 75% of the adjusted payment amount and (ii) 25% of the adjusted fee schedule (Section 3712)
  • Hospitals can elect to receive up to 100% of Medicare prior period payments (125% for critical access hospitals) for up to a 6-month period, as an advance, with loan repayment not starting for four (4) months and have twelve (12) months to repay without interest (Section 3719)
  • Delay of Disproportionate Share Hospital (DSH) reductions through November 30, 2020 (Section 3813)

Not-for-Profits (Including Health Care Institutions)

  • Under the 5-year loan program to be developed by Treasury, low-interest rate program targeted to not-for-profits with 500-10,000 employees with no principal and interest due for at least 6 months (Section 4003)

Debt Restructurings (Section 4013)

  • From March 1, 2020 and ending on earlier of December 31, 2020 or through the emergency period and 60 days thereafter
  • Financial institutions may elect to suspend the requirements under GAAP for loan modifications that would otherwise be categorized as a troubled debt restructuring
  • The rationale for loan modifications must be related to COVID-19

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