ASC Federal Financial Relief for COVID-19

Join ASCA Chief Executive Officer Bill Prentice and ASCA Director of Government Affairs & Regulatory Counsel Kara Newbury for some brief updates to the new federal financial assistance available to ASCs. 

In this 12-minute episode, Bill and Kara provide an overview of the funding programs created by the recently enacted CARES Act and other federal initiatives that are available to healthcare providers. They also discuss recent updates and guidance that ASCA has obtained from the Centers for Medicare & Medicaid Services (CMS) regarding eligibility, applications and pending requests for additional regulatory guidance.

This short episode is the first of several that ASCA intends to produce in the days ahead to help ASCs navigate the challenges of the current COVID-19 operating environment. The podcasts will be short, informal and focused on delivering information to the ASC community.

Transcript

Bill Prentice:   0:06
Hi, I'm Bill Prentice, the chief executive officer of the Ambulatory Surgery Center Association, or ASCA, and I'm welcoming you to our initial podcast to try and provide some brief information for listeners about the COVID-19 pandemic and the things that the association is working on to help surgery centers survive and hopefully thrive after the pandemic. The purpose of these podcasts is to be brief, little overviews of some of the things we're working on. And we hope to be putting a new podcast out every few days to help provide some resources to you and that hopefully will help guide you through the pandemic. My guest today is Kara Newbury, who's ASCA's director of Government Affairs and regulatory counsel. So Kara, welcome.

Kara Newbury:   1:03
Thanks, Bill.

Bill Prentice:   1:05
So, I think on this initial podcast, Kara, what I'd like to provide for our listeners is some things that we're working on related to some of the economic relief that has been put forward by the federal government in the past couple of weeks. As our listeners know, just about two weeks ago the Congress passed and President Trump signed the CARES Act, which was $2.2 trillion worth of economic relief for the country, and embedded in that $2.2 trillion were a handful of programs and resources that are available to surgery centers and other care providers. And what I'd like to do is just kind of list the four of those and then we can go through each one of them and talk about some of the things we're working on related to each of them that our listeners might find interesting. So they are first, the Medicare advance payment program. So Kara, in a sentence how would you describe that program?

Kara Newbury:   2:08
The accelerated and advance payments are available to facilities that have billed Medicare in the previous 180 days prior to signing to request. And you can receive up to three months worth of accelerated fee-for-service Medicare payments.

Bill Prentice:   2:28
Great thanks, Kara. The second, actually I'll list the next two together. There are two loan programs that were funded through the CARES Act to the Treasury Department and the Small Business Administration, and those two loan programs are the payroll protection program and then the Economic Injury Disaster Loan program. Could you give a just one sentence overview of both of those programs?

Kara Newbury:   2:54
Sure, Bill. The paycheck protection loan program provides qualified businesses with loans of up to $10 million at a 4 percent interest rate. If they are covering payroll costs with that, the loans are actually forgivable, so you would not need to pay those back. The second program is the Economic Injury Disaster Loan program, and those loans are for up to $2 million and it has an extended repayment term of up to 30 years.

Bill Prentice:   3:24
Thanks, Kara. And I just want to reiterate, so that payroll protection program, even though it's initially a loan, if you follow the guidelines, you know, hire back your employees within a certain timeframe, that loan actually becomes forgivable and actually turns into a grant, which is very important and good for people to know. And then the fourth source of revenue coming out of the CARES Act that ASCs can access were grants that were just released this past Friday. Can you give a quick overview of that program?

Kara Newbury:   3:55
Sure, Bill. In the CARES Act there were $100 billion set aside for healthcare providers to help with lost revenue due to COVID-19; $30 billion of that has been allocated. Our facilities and physicians who bill fee-for-service Medicare in 2019 should have received an automated clearing house (ACH) payment or, if you are paid through Medicare by actual check, then you will be receiving a check in the mail in the next few weeks.

Bill Prentice:   4:33
Great, and I want to remind our listeners that they can find a lot more about each of these programs by going to the ASCA website, ascassociation.org, and go to our COVID-19 resource page. We have a host of resources there, including more information about each of these four programs with information about how you can apply for them, for the loans, and more information about the grant program. So now that we've outlined the four programs that are currently available to surgery centers, I'd like to turn and talk for a minute or two about some things that we're working on to improve each of them or to make them more accessible to ASCs. So starting with the Medicare advance payment program, one of the limitations that we're aware of is the very short timeframe currently required to pay back those loans. And I know that we've heard from a lot of surgery centers and a lot of physicians' offices about concerns about based upon where they might be in the next few months economically, whether or not they're gonna be in a position to pay back those loans. So, Kara, what are we doing there?

Kara Newbury:   5:50
Currently under the program, facilities would have to begin making payments toward those loans 120 days after they started receiving funds and would have to be fully paid back within 210 days. So, approximately seven months. We're seeking to extend that payment timeframe to at least one year.

Bill Prentice:   6:13
And then, when we talk about or look at those SBA loan programs, the payroll protection loan and the EIDL loans, one of things that we were quickly aware of is that some of the existing Small Business Association rules and regulations that kind of govern what is a small business have tripped up a number of surgery centers that would like to be able to apply for those loans. In particular, there are these things called affiliation rules that SBA uses in situations where a small business is affiliated with some larger organization. And unfortunately, it seems as though the affiliation rules are being applied to surgery centers who are aligned with large  management companies or are in joint ventures with hospitals. And as a result of those relationships, many ASCs aren't able to access either of those two loan programs. Kara, what are we looking to do to try and help out those surgery centers?

Kara Newbury:   7:16
ASCA has requested regulatory clarification from the Small Business Administration, and if that's not possible, we are seeking some clarification in future legislative relief as Congress looks to either replenish the paycheck protection loan program or establish different loan programs that will allow for all of our facilities to take part.

Bill Prentice:   7:47
And obviously, as we learn more about these efforts or we are successful in either approach, either from the regulatory front or the legislative front, we'll be getting that information out to our members ASAP. Finally, the fourth source of potential revenue for surgery centers is due to this $30 billion in grants that were released on Friday to Medicare providers, again, as part of that CARES Act appropriation. Can you tell us a little bit more about that and some of the things that we've heard about since those funds were released?

Kara Newbury:   8:23
Absolutely, Bill. And these funds were, started being, as we said, distributed last Friday, very quick distributions. It's approximately 6 percent of a facility's 2019 Medicare fee-for-service allowed services. And facilities are going to have to attest to meeting certain terms and conditions in order to keep the funds that they have received. We started receiving lots of concern from our members as to one of the terms in particular, which seems to require facilities to be currently treating or serving patients with potential or confirmed cases of COVID. HHS did just today put out a revised terms and conditions document that indicates that you do not have to currently be seeing patients so it does still apply to our facilities that have had to close down due to COVID-19, and in addition, HHS did put clarifying language up on their website that they are very broadly viewing COVID patients. So, you don't have to be intentionally seeing someone who is positive or potential, they're viewing any patient who comes into your facility as a potential COVID patient.

Bill Prentice:   9:51
Kara, that's great news and great work in terms of getting that clarification for our members, who are obviously in desperate need of that capital and will put that to good use. We're about out of time. So I just want to sum up by saying that there are these four different programs where ASCs can get some revenue, some capital, and that to find out more about them, again, please go to the ASCA website and go to our COVID-19 resource page. We're working very hard to try and make sure that ASCs can get some economic relief during these very trying times. And to sum up, we're still looking to try and change these official affiliation rules to allow ASCs that are in joint venture with hospitals or management companies to be able to access those loans. We're looking to get longer terms for the Medicare advance payment loans so that you have a little more time to pay those back. And we're, you know, we obviously got that clarification on that initial grant. We understand that while that's obviously much appreciated to get that revenue into our accounts right away that we're gonna need more economic health if we're gonna be able to survive the next month or two if we're still operating under a guidance that really is postponing all elective surgeries. So rest assured that ASCA will be working to try and get additional relief through the next legislative package that will be forthcoming. We have lots of other topics that we could have talked about today, but obviously don't have time since we want to keep these kind of constrained and bite sized. So we'll be recording additional podcasts in the next few days on different topics, like the Hospitals Without Walls program and the waivers that have been provided at the federal and state levels to allow surgery centers to do different things, and a lot of the other legislative activity that we're working on to try and help ASCs during the pandemic. So please check back on the ASCA website to look for additional podcasts like this one. If you have any suggestions for topics that you'd like to see us cover on one of these podcasts, please email them to us. And with that, I want to thank Kara again for spending a little bit of time with me talking about these issues. And I hope that all of you remain safe and healthy. Thank you.