March 31, 2020
Health Care Alert
This alert discusses key considerations and questions that may be affecting both your provision of health care services as a health care service provider and your ability to continue to provide day-to-day operations as a small business owner.
As COVID-19 continues to have a drastic impact on the normal day-to-day business operations of businesses throughout the nation, health care providers who are also small business owners have been left with the financial fallout and regulatory changes impacting the provision of health care services. With lasting uncertainty surrounding issues arising from the COVID-19 pandemic and the ability of small businesses to survive the pandemic, non-hospital heath care service providers who are also small business owners must deal with issues such as:
This guide will provide you information related to key considerations and questions that may be affecting both your provision of health care services as a health care service provider and your ability to continue to provide day-to-day operations as a small business owner. For a list of NP alerts that may provide you with information, please refer to the list at the end of this guide.
The purpose of the Coronavirus Aid, Relief and Economic Security Act (the CARES Act), among other things, is to provide emergency assistance to small businesses in response to the financial impact on businesses affected by the COVID-19 pandemic. Below is a high-level checklist of the types of loans and grants available and considerations that should be taken by small businesses when determining if and what types of financial assistance such businesses should apply for when in need of emergency financial assistance.
For more detailed information regarding the financial assistance described above, please refer to Nixon Peabody’s recent alert: “Stimulus provides relief for businesses during coronavirus crisis.”
All across the country, small businesses are faced with options regarding cutting back staff employment for both full-time and part-time employees. Specifically, small businesses providing health care services, such as dentistry, physical therapists, and other medical practices are faced with providing limited services. Some health providers have also switched to providing telehealth services.
The difference between furloughing and laying off employees is that an employee furlough places employees on temporary non-duty status for lack of work or funds and other considerations, while a layoff is recorded by an employer as a termination of employment.
For more detailed information regarding the types of employment-related issues that employers should consider when deciding whether to furlough or lay off employees, please refer to Nixon Peabody’s recent alert: “Coronavirus furloughs vs. layoffs: What’s the difference? And what does that difference mean for employer-sponsored retirement plans?”
The CARES Act amends and expands the applicability of the Family Medical and Leave Act (FMLA) and the Emergency Paid Leave Act to incorporate emergency provisions due to COVID-19.
For more detailed information regarding changes to relevant portions of the paid leave law, please refer to Nixon Peabody’s recent alert: “Families First Coronavirus Response Act: What employers need to know about the COVID-19 paid leave law.”
In addition, for more information regarding tax credits and other considerations for employers providing paid leave, please refer to Nixon Peabody’s recent alert: “Tax-free disaster relief payment plans for employees: What employers need to know.”
The CARES Act also provides for certain special considerations for different types of health care providers that may be relevant depending on your current provision of health care services. The following is a non-exhaustive list of key takeaways and information to consider:
For more information regarding the CARES Act with specific considerations for health care providers and information regarding employee benefits, please refer to Nixon Peabody’s recent alert: “CARES Act includes several employee benefits-related provisions.”
The CARES Act provides certain financial restructuring assistance for small businesses facing financial distress. It has modified the Small Business Reorganization Act (SBRA) by expanding the restructuring options available for small businesses and increasing the permitted maximum indebtedness for such relief to $7,500,000 through March 27, 2021. The SBRA helps small businesses by streamlining and allowing such businesses to maintain some control over the debt restructuring process.
For more information regarding the availability of filing for bankruptcy under the SBRA, please refer to Nixon Peabody’s recent alert: “CARES Act expands restructuring options for small businesses.”
Below please find additional Nixon Peabody alerts that you may find helpful as we continue to deal with changes and expansions in certain employer-employee related laws/regulations as COVID-19 continues to impact small business and health care providers throughout the nation.
The foregoing has been prepared for the general information of clients and friends of the firm. It is not meant to provide legal advice with respect to any specific matter and should not be acted upon without professional counsel. If you have any questions or require any further information regarding these or other related matters, please contact your regular Nixon Peabody LLP representative. This material may be considered advertising under certain rules of professional conduct.
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