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Three COVID-19 Financial Relief Programs For Small Business

Jeff Griffin

While we've fielded thousands of questions these past few weeks about the COVID-19 pandemic, the vast majority of inquiries most recently have been about emergency financing relief for small business.

Here is what we know about three financial relief programs, each made possible by the CARES Act recently signed into law; 

  • CARES Paycheck Protection Program (PPP)
  • CARES Business Debt Relief Program
  • CARES Economic Injury Disaster Loans (EIDL) & Emergency Economic Injury Grants (EEIG)

As a reminder, we update both of our COVID-19 Download Resource Centers daily with regulatory briefs, legislative summaries, newsletters, flyers, and posters for you to use as you see fit.

Make sure to bookmark this resource area for ease of reference later.

CARES PAYCHECK PROTECTION PROGRAM (PPP)

What is the Paycheck Protection Program?

The PPP is a program designed to minimize layoffs during the coronavirus pandemic. The PPP provides businesses with fewer than 500 employees with 100 percent federally-guaranteed loans, which may be forgiven, if borrowers maintain their payroll during this pandemic.

Must a PPP loan be paid back?

No, providing an employer maintains their payroll, the loan will be forgiven. We'll address the amount of loan forgiveness available later in this article.

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Topics: Legislation

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Employer Impact; The $2 Trillion COVID-19 Stimulus Package

Jeff Griffin

To say that the Coronavirus (COVID-19) pandemic has put a significant strain on every aspect of daily life around the world would be an understatement. As the spread of the disease shows no sign of slowing down, there remains steadily increasing concern in this country, not only about the health of our citizens, but also our economy, which is now in tatters, through no fault of its own.

In response, on Friday, the United States Congress passed a $2 trillion package to provide a jolt to our economy, reeling from the deadly virus. This is the third aid package from Congress and is it designed to keep businesses and individuals afloat during an unprecedented freeze on the majority of American life.

This will most likely not be the last stimulus package Congress will have to enact. This is especially true given that President Trump, just yesterday, extended his administration's social-distancing guidelines through the end of April, as the peak death-rate from the virus is expected to hit in two weeks. (The death toll from COVID-19 past 2,000 over the weekend.)

Most economists are in agreement that last Friday's $2 trillion package isn't a stimulus plan at all, but rather a relief package. Senate Majority Leader Mitch McConnell (R-KY) described the legislation this way; "No economic policy can fully end the hardship, so long as the public health requires that we put so much of our commerce on ice. This isn't a stimulus package. It is emergency relief. Emergency relief. That's what this is."

All Americans would do well to understand the provisions of this latest stimulus/relief package, as it will offer direct relief to businesses and individuals alike. Here are the details.

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Topics: Legislation

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Senate Majority Leader Sets Midnight Deadline for Third Stimulus Package

Jeff Griffin

 

“As frightening as yesterday’s unemployment numbers were, it’s merely a preview of how bad things are going to get.” That’s a quote from today’s Wall Street Journal, and it’s probably an understatement.

With businesses all around us temporarily shutting down, and some outright going out-of-business, the U.S. economy is headed off a cliff, into uncharted territory, and our leaders know it.

With Senators on both sides of the isle disagreeing over how best to help individual Americans during the coronavirus pandemic, they are at least unified in the pressing need to get something more done - and as fast as possible.

If met, tonight’s midnight deadline, declared just an hour ago by Senate Majority Leader Mitch McConnell, would make it possible for the legislation to be drafted at breakneck speed over the weekend. This would allow Senators to vote as early as Monday on what is sure to be a wide-ranging stimulus package which is likely to top $1 trillion.

Here's what they are considering.

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Topics: Legislation

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Is Medicare-for-all Good for Business Owners and Employees?

Jeff Griffin

Today the first official votes will be cast, both in Iowa and California, for the 2020 presidential election. A hot button topic in the discourse leading up to this moment has been whether the country should migrate to a single-payer healthcare system commonly referred to as "Medicare-for-all."

While every Democratic candidate still in the running supports some level of change to the current healthcare system, Medicare-for-all is a solution championed primarily by Vermont Senator Bernie Sanders and Massachusetts Senator Elizabeth Warren.

Both are pushing for a single-payer solution where Americans would be enrolled automatically in a government-run medical insurance plan. Both of their policies call for essentially disbanding private insurance, or relegating it to something only needed to supplement care outside of the provisions provided in their single-payer solutions.

Should Employers Embrace Medicare-for-all?

Would this transition to Medicare-for-all be a good thing for employers, 4.5 million of which are providing employer-sponsored group health insurance to over 160 million Americans representing 49 percent of the country's total population?

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Topics: Cost Containment, Disruption, Legislation

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Skyrocketing Prescription Drug Prices - Finally In Bipartisan Crosshairs

Jeff Griffin

Last week we wrote about a recently issued Executive Order by the White House to hopefully usher in healthcare price transparency from hospitals and insurance carriers, both of whom hold their secret price negotiations close to the vest. We expressed optimism over the order’s ability to tame runaway consumer and employer healthcare costs. Sunlight, after all, is said to be the best disinfectant.

There’s another area of equal concern which has been driving up the cost of employer-sponsored healthcare for quite some time - prescription drug pricing. In a word, it is skyrocketing, with no end in sight.

The price of pharmaceutical drugs is rising 3x faster than wages, and 5x faster than inflation. In fact, more than 3,400 drugs have boosted their prices in the first six months of 2019, an increase of 17 percent in the number of drug hikes from a year earlier. And the average price hike across all prescription drugs stands at 10.5 percent.

A new coalition of health advocate groups was formed in October to make their voices heard on drug price transparency, caps on drug price increases, and other price reducing strategies. The coalition has identified drug manufacturers and pharmacy benefit managers (aka the middlemen) as the culprits, but it’s literally going to take an act of congress to get this under control.

The drug hikes come at a time when (or perhaps because) lawmakers and the Trump administration have vowed to address the problem of rising prescription costs.

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Topics: Cost Containment, Disruption, Legislation, Price Transparency

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Employers Should Welcome Healthcare Price Transparency, Despite Industry Objections

Jeff Griffin

The Trump administration, hungry to notch a win on healthcare prior to the 2020 election, continues to push ahead on initiatives designed to reign in healthcare costs. We applaud these efforts and are disappointed and dismayed by those in the healthcare industry opposed to these undertakings.

Announced November 15, the White House’s price-disclosure initiative would most certainly upend the $3.5 trillion healthcare industry. In fact, the requirements called for, by executive order, are far more extensive than many industry experts predicted. Somewhat expectedly, they have drawn the ire of hospitals and healthcare delivery providers caught in its crosshairs.

The Executive Order On Healthcare Transparency

Issued jointly by the Department of Labor (DOL), Department of Health and Human Services (HHS) and the Treasury Department, the proposal imposes new transparency requirements on group health plans and health insurers in both the individual and group markets.

In the simplest of terms, the proposed rule will force hospitals and insurers to disclose the highly secretive rates they negotiate with each other for an extensive list of services, including doctor and facility fees, supplies, and even drug costs.

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Topics: Cost Containment, Disruption, Legislation, Price Transparency

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Surprise Medical Billing Reaches a Tipping Point

David Rook

All across the country, a sweeping movement to combat surprise medical bills has been slowly percolating and is now finally gaining traction on a national level.

What began as grievances filed by wronged patients has grown into government officials at both the state and federal level championing legislation against this industry practice.

A law that recently went into effect in Arizona and recent remarks from President Trump are merely the latest in an ongoing trend that has the force to reshape how patients are billed for out-of-network expenses.

Unexpected Out-of-Network Charges Result in Surprise Medical Bills

Surprise medical billing isn’t so much an intentional practice of healthcare companies, as much as it’s a byproduct of the fractured healthcare industry. Specifically, it’s a result of multiple institutions and providers treating patients simultaneously while working for different employers.

In its simplest form, a surprise medical bill is an unexpected medical bill that patients receive for out-of-network services that they thought were in-network. The bill is sent after the services are provided, leaving patients with little recourse and high fees since out-of-network charges tend to be much higher than those in-network.

An all too common scenario shows how easy this can happen to patients. A patient goes to a hospital for a covered surgical procedure. They’ve done their research and have made sure that both the hospital and the surgeon’s practice are within their insurer’s network. In completing this due diligence, they then assume that the entire procedure will be covered as an in-network expense. Seems reasonable, right?

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Topics: Cost Containment, Legislation, trends, Arizona, healthcare costs, Arizona Regulations

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The State of the Union Address and What It Means For Employee Benefits

Jeff Griffin

Last week, President Donald Trump delivered the 2019 State of the Union Address (SOTU). The SOTU is an annual message delivered by the president to a joint session of Congress at the beginning of each year.

At this year’s SOTU, President Trump discussed issues that have the potential to impact the employee benefits industry, as well as employers offering healthcare and benefits to their employees. The issues he discussed included pre-existing conditions, lower prescription drug prices, and nationwide paid family leave.

While the SOTU is just a speech, often times packed with lofty aspirations, it does sometimes lead to policy. Here is a recap of what was addressed:

Pre-existing Condition Protection

In a departure from 2018 Department of Justice actions, President Trump announced in the address that people who have pre-existing conditions should receive protections. If the administration holds true to this goal, they will likely find cross-aisle support, as pre-existing condition patient protection was a key campaign issue in the midterm elections.

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Topics: Paid Time Off (PTO), Legislation, Prescription Drugs, Pre-Existing Conditions

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Trump's Plan To Reduce Prescription Drug Prices

Jeff Griffin

So it was with great interest that we took note of last Friday’s White House Rose Garden announcement by President Trump to “bring soaring drug prices back down to earth” by promoting competition among pharmaceutical companies, and giving private entities more tools to negotiate better deals on the behalf of consumers, insurers and employers.

Somewhat surprising in his announcement was his abandonment of some of the more populist proposals which he boasted about during his presidential campaign, including his promise to authorize the Feds to negotiate directly with drug companies in an effort to lower Medicare drug prices and disallowing American consumers from importing low-cost prescription drugs from overseas.

Nevertheless, both Republican and Democrats (as well as all of us here at the JP Griffin Group) welcomed the President’s attention on combating high drug prices. The looming question remains just how the President’s promises to lower drug prices will play out and if the concepts proposed will ever come to pass.

We certainly hope the plan gains traction as both employers and employees alike could sure use a break from escalating drug prices which have now become a primary driver of health-related expenditures.

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Topics: Cost Containment, Legislation, CFO, Pharmacy, Prescription Drugs

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Alternative Health Plan Options For Small Employers: MEWAs and AHPs

Jeff Griffin

Employers have been struggling to find the best way to provide affordable health benefits to their workers for many years now. One promising option, especially for those with smaller workforces, is to offer insurance through multiple employer welfare arrangements (MEWAs) and association health plans (AHPs).

The idea behind MEWAs is to bundle small groups into a larger community, thereby spreading risk over a larger and more diverse pool of covered individuals. It’s the same principle large employers benefit from by way of lower insurance premiums.  

If your small business is looking for cheaper healthcare options, MEWAs and association health plans may be good options for you to investigate.

What is a MEWA?

MEWA stands for multiple employer welfare arrangement, but is also sometimes referred to as a multiple employer trust (MET). MEWAs allow small employers to essentially team up to create a larger pool of employees to capitalize on the economies of scale that larger employers enjoy. This could mean as few as two employers in the group, or as many as deemed necessary to form a large enough employee pool.

Each employer gets a say in plan design, as well as plan offerings. If one employer has an older population who prefers more traditional plans, they can request such for their workforce. If another employer has a younger workforce for whom high deductible health plans would be more appealing, they could request more consumer-driven healthcare options for their employees. With these groups banded together, the premium costs should be lower than if each employer tried to get insurance on their own.

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Topics: Employee Benefits, Compliance, Cost Containment, ACA, Legislation, Association Health Plans, MEWA

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