VGM & ASSOCIATESHealthcare MSO
Full Menu Search

Final Analysis: COVID-19 Government Stimulus Packages

Published in Government Relations on October 20, 2021

Healthcare providers were presented with several economic stimulus programs to relieve some of the burdens brought on by the COVID-19 public health emergency (PHE). During a recent presentation, VGM’s Mark Higley, VP of Regulatory Affairs, and Craig Douglas, VP of Payer & Member Relations, have summarized these programs, what is required of providers to stay compliant, and the tax implications surrounding these programs. 

HHS Provider Relief Fund (PRF) and Updated Reporting Requirements 

Providers did not need to apply for this program to receive funds. Providers who received over $10,000 in funds must adhere to the reporting periods based on payment timeframes: 

  • Period 1:  
    • Funds received April 10-June 30, 2020  
    • Funds must be used up by June 30, 2021 
    • Reporting portal opened July 1, 2021 
    • Complete report by September 30, 2021 
  • Period 2:  
    • Received funds July 1-December 31, 2020 
    • Funds must be used up by December 31, 2021 
    • Reporting portal will open January 1, 2022 
    • Complete report by March 31, 2022 
  • Period 3:  
    • Funds received January 1-June 30, 2021 
    • Funds must be used up by June 30, 2022 
    • Reporting portal will open July 1, 2022 
    • Complete report by September 30, 2022  
  • Period 4:  
    • Funds received July 1-December 31, 2021 
    • Funds must be used up by December 31, 2022 
    • Reporting portal will open January 1, 2023 
    • Complete report by March 31, 2023 

Remember that PRF funds must be used to prevent, prepare for, and respond to coronavirus, and all expenses need to be supported by adequate documentation. Tax-wise, the payments received from the PRF are included in gross income for for-profit providers. Provider relief funds monies received are taxable unless the entity is not for profit. 

Resources: 

Medicare Advanced Payments 

The COVID-19 Accelerated or Advance Payment (CAAP) program was created as a result of the PHE, and providers had to apply to receive these funds.  

Repayment Requirements: 

  • Repayment begins one year from the payment issue date and continuing for 11 months, Medicare payments owed to providers will be recouped at 25%. 
  • After the 11 months end, Medicare payments owed to providers will be recouped at a rate of 50% for six months.  
  • After the six months end, a letter for any remaining balance of the payment(s) will be issued. If a provider doesn't satisfy that within 30 days, 4% interest begins to accrue

Resources: 

Economic Injury Disaster Loans (EIDL) Advance Payments 

Due to the PHE, the Small Business Association (SBA) added an advanced payment feature to loans, which did not have to be repaid. EIDL applicants can qualify for up to $15,000 without repayment, but eligibility criteria must be met. The Targeted EIDL Advance provides funding of up to $10,000 to eligible applicants, and the Supplemental Targeted Advance provides an additional payment of $5,000 to eligible applicants.

Resources: 

Payroll Protection Program (PPP) Taxation 

The CARES Act excludes the forgiveness of PPP loans from federal gross income and federal income tax. For providers who received payroll protection loans, those payments are exempt from federal income tax. 

State tax implications and expenses incurred: 

  • Forgiven loan amounts may be subject to state income taxation. 
  • In the several states that have “rolling conformity” to the IRC, these forgiven loans will likely not be subject to tax.  
  • Providers should know the status of their states’ conformity rules to plan accordingly. 
  • Congress approved the deductibility of covered expenses paid with PPP funds. So, when used for the appropriate expenses, those funds are deductible. 
  • Some states may deny the deduction or require income inclusion and allow the deduction. Visit https://taxfoundation.org/state-tax-forgiven-ppp-loans/ to find the latest information on their state rules. 
  • Taxpayers may consider filing extensions. 
  • Small business owners should talk with a tax adviser familiar with their state's tax laws before filing. 

New OSHA Requirements 

OSHA’s COVID-19 Emergency Temporary Standard (ETS) has appeared on the Federal Register website as an Interim Final Rule with request for comments. This ETS directs OSHA to reduce the risk for workers who are at risk of contracting COVID-19 in workplaces including healthcare facilities, DME suppliers, and home health agencies.  

What Providers Need to Keep in Mind: 

  • Implementation of these regulations and additional restrictions could vary by state.  
  • Providers must comply with these requirements.  

Resources: 

For any questions, please contact Craig Douglas at craig.douglas@vgm.com or 319-290-3535 and Mark Higley at mark.higley@vgm.com or 319-504-9515.

TAGS

  1. covid-19
  2. osha
  3. paycheck protection program
  4. phe

Get Connected

Stay up-to-date on the latest resources and news provided by VGM & Associates.

Sign Up for Email

From Our Experts

Manufacturer Survey On Tariffs thumbnail Manufacturer Survey On Tariffs The American Association for Homecare and VGM Group are seeking valuable insights from durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) manufacturers and vendor partners regarding tariffs imposed on certain countries. Key Payers Denied Your Application Citing Their Network Is Closed – Now What? thumbnail Key Payers Denied Your Application Citing Their Network Is Closed – Now What? This experience has increasingly become one of the most common questions we receive from our provider members as more and more payers move to narrow their provider networks. The reasons payers seek to narrow their networks are simple. Payers are highly motivated to achieve their goals while doing less work and are not required to allow providers into their networks unless there is a patient access issue. For those of you fortunate enough to be a part of a narrow network, this may not be much of Congress Returns: Medicaid Cuts Take Center Stage thumbnail Congress Returns: Medicaid Cuts Take Center Stage Congress is back in session after a two-week recess. Number one on the docket is figuring out the budget. The house is tasked with coming up with a $1.5 trillion reduction and a key committee is in the spotlight. The DMEPOS Relief Act Of 2025 – WE NEED YOUR HELP! thumbnail The DMEPOS Relief Act Of 2025 – WE NEED YOUR HELP! The DMEPOS Relief Act of 2025 (or H.R. 2005) is bipartisan legislation that was recently introduced in Congress designed to increase reimbursement for a large percentage of HME providers across the country. This bill establishes a higher reimbursement rate (known as the 75/25 blended rate) for durable medical equipment in nonrural/noncompetitive bidding areas under Medicare until Dec. 31, 2025. Champion Of Change: Lauryn Estrella Speaks On Tariffs Impacting HME Providers And Patients thumbnail Champion Of Change: Lauryn Estrella Speaks On Tariffs Impacting HME Providers And Patients Today, we shine a spotlight on Lauryn Estrella, the dedicated Executive Director of Home Medical Equipment and Services Association of New England (HOMES) and a true Champion of Change in the HME industry. Ensuring Access To Care: The Fight For Permanent Telehealth Flexibilities thumbnail Ensuring Access To Care: The Fight For Permanent Telehealth Flexibilities Americans utilizing telehealth services to access healthcare is at an all-time high. It's a convenient method without having to leave the home, giving access to healthcare professionals from anywhere. It expands a patient's choice of provider and enables the provider the ability to see more patients. SOAR Act Takes Flight: Bipartisan Push To Improve Supplemental Oxygen Access And Medicare Protections thumbnail SOAR Act Takes Flight: Bipartisan Push To Improve Supplemental Oxygen Access And Medicare Protections The Supplemental Oxygen Access Reform (SOAR) Act has been reintroduced in both the House and Senate. In the House, the bipartisan H.R. 2902 was introduced by Representatives David Valadao (R-CA), Julia Brownley (D-CA), Adrian Smith (R-NE), and Gabe Evans (R-CO). Meanwhile, in another show of bipartisan support, S1406, was introduced in the U.S. Senate by Senators Bill Cassidy (R-LA), Mark Warner (D-VA), and Amy Klobuchar (D-MN). Melanie Ewald Joins VGM Government Relations Team As VP Of Payer Relations And Reimbursement thumbnail Melanie Ewald Joins VGM Government Relations Team As VP Of Payer Relations And Reimbursement VGM Government Relations is proud to announce the addition of Melanie Ewald as Vice President Of Payer Relations And Reimbursement.

Give your business an advantage over the competition.

Become a Member