American College Of Surgeons - Inspiring Quality: Highest Standards, Better Outcomes

Financial Resources Available to Assist Surgeons

In December 2020, Congress passed the Consolidated Appropriations Act, 2021 to fund the federal government for the remainder of the fiscal year and to provide stimulus and aid to counter the ongoing impacts of the COVID-19 health emergency. Among the provisions of this expansive legislation were extensions or renewals of programs that may be of assistance to some surgeons feeling the effects of the pandemic. In addition to the funding opportunities and other support listed below, the legislation contained many provisions such as payroll tax deferrals, SBA debt relief and interactions between existing programs that may benefit certain surgeons with very specific circumstances. It is recommended to discuss your specific situation with your tax or financial professional to see if there are additional opportunities for your practice.

Paycheck Protection Program (PPP)

UPDATE: At the time of posting, regulations to implement recent changes to the PPP have not been published. We will continue to update this section as information on the application and loan forgiveness process becomes available.

The Paycheck Protection Program was created in early 2020 in an effort to keep businesses solvent and workers on payroll. If a sufficient percentage of funds are used for designated purposes, the loans can be partially or fully forgiven. Since its creation the program has seen multiple regulatory and legislative revisions. The program received $284.5 billion in new funding in the Consolidated Appropriations Act which are available to both new applicants as well as those applying for a second loan.

The new second round of loans for small businesses is intended to provide up to 2- and one-half months of payroll expenses to struggling businesses with a maximum loan amount of $2 million. This so-called "second or subsequent draw" is limited to entities with fewer than 300 employees who can demonstrate revenue reduction of at least 25 percent.

Loan funds used for the specified allowable purposes could be forgiven up to the full amount of the loan. Eligible expenses include payroll, mortgage interest, rent and utilities and under the terms of the new legislation, other operating costs, property damage from social disturbances not reimbursed through insurance, and the cost of PPE and efforts to protect employees from COVID-19. Borrowers are no longer required to deduct any EIDL Advances from their PPP loan forgiveness amount.

PPP loan forgiveness rules have changed twice, first on June 5, with the enactment of the Paycheck Protection Program (PPP) Flexibility Act and subsequently with passage of the Consolidated Appropriations Act. Provisions of the law will relax rules for the PPP giving borrowers more time to spend funds received and to use those funds for a broader set of expenses while still qualifying to have all or a portion of the loan forgiven. Information on PPP loan forgiveness from the SBA can be found here. Due to the complexity of this program, Fellows should consider enlisting the services of their professional tax advisor if they have questions about their loan and the loan forgiveness rules.

The Consolidated Appropriations Act makes a number of favorable tax changes related to the PPP, clarifying that amounts forgiven under either an initial PPP distribution or a subsequent distribution will not be included in gross income for tax purposes. Further, the legislation states that no deduction shall be denied due to this exclusion from gross income. This reverses previous statements from the IRS indicating that business expenses paid with forgiven PPP funds would not qualify for deductions. The ACS continues to urge Fellows who received PPP loans or other assistance to consult with their accountant, tax professional or attorney.

Note: To increase transparency, the SBA and Treasury will continue to release information about borrowers who participate in the PPP. The names of recipients, the amounts they received (broken into ranges of dollar amounts received), and demographic data will be publicly disclosed on loans exceeding $150,000. It should be noted that personal identification information will be withheld.

Economic Injury Disaster Loans (EIDL)

According to the SBA, the EIDL program "provides economic relief to small businesses and nonprofit organizations that are currently experiencing a temporary loss of revenue." As part of the response to the ongoing health emergency, the program was expanded to provide rapid advance grants of up to $10,000. After a pause in applications due to overwhelming demand (an SBA report showed more than $178 billion in EIDL loans had been approved through August 7), the SBA announced that it would begin taking and processing new applications for the EIDL. The Consolidated Appropriations Act included an additional $20 billion for the advance grant program. Practices that previously received a grant of less than the full $10,000 may be able to receive a second grant up to the full limit. It is recommended that interested parties. It is recommended that interested parties apply on the SBA website as soon as possible, as funds for this program are limited and the first round was fully expended in a short period of time.

Provider Relief Funds from the Public Health and Social Services Emergency Fund

The Consolidated Appropriations Act included an additional $3 billion for the Provider Relief Fund, which was created to reimburse physicians, facilities and others for the unreimbursed costs or lost revenues associated with the coronavirus. There have been multiple disbursements from the provider relief fund available to surgeons. The legislation also streamlined the process for determining lost revenues attributable to the pandemic, and specified that not less than 85 percent of remaining funds in the program shall be for payments to providers for losses or changes in operating expenses for the second half of 2020 or the first quarter of 2021. Details on when the application period for any subsequent phase of the Provider Relief Fund will be are not currently available but will likely be accepted through this portal. ACS will update this section when further information is released. Additional information on the Provider Relief Fund from CMS is available here.

HHS continues to update the FAQs and the Terms & Conditions for these payments frequently as it has adapted to the challenges of implementation and announced additional funding opportunities and requirements. We recommend visiting the CARES Act Provider Relief Fund website for the most up-to-date information.

ACS staff have received multiple reports from Fellows who appear to meet all criteria but have not received funds from either program. Surgeons who believe they are eligible but have not received a payment should contact UnitedHealth Group’s Provider Relations line at 866-569-3522 about eligibility, whether a payment has been issued, and where the payment was sent. Alternately, you can email COVID-19@cms.hhs.gov detailing your concerns and any steps you have taken to qualify.

If you are employed by a hospital or other entity, please note that your payment will be sent to the TIN responsible for billing for your services and will not necessarily be passed along to you. Also note that only one application per TIN is accepted. The ACS encourages surgeons concerned about how payments are being allocated to inquire and discuss this with their employer. It may also be beneficial to have an attorney review the terms of your contract to see if situations like this are addressed.

Student Loan Relief

The stimulus provisions of the Consolidated Appropriations Act failed to address student loan forbearance. The current extension of relief on federal student loan payments announced by the US Department of Education on December 4, 2020 is set to expire on January 31, 2021. The current relief applies to payments and interest accrual and prohibits debt collection on defaulted loans. Borrowers should contact their lender or loan servicer to see if they qualify.

Some surgeons with student loans may also benefit from an extension of a tax credit for employers who make student loan payments on their employees' behalf.  Under the provision, employers may receive a tax deduction for up to $5,250 per employee for such loan payments.  This provision originally expired at the end of 2020 but has now been extended through the end of 2025.  Surgeons with school loans are encouraged to ask their employers if they offer loan repayment benefits. We will update this section as additional relief or information becomes available.