How the Next COVID Relief Package Could Affect Your Home Care Agency
Washington has been negotiating for weeks. Yet, we continue to face an impasse over the next COVID Relief Package. According to resources negotiations are likely to drag on for a while longer as both sides have indicated they are not close to a deal. Both parties have put forth a proposal for the next package. The total cost of the bill is one of the biggest obstacles between the two sides. The Democrats HEROES Act was proposed and passed the House of Representatives in May at a cost of $3 trillion. The Republicans HEALS Act was proposed in July at $1 trillion. The biggest point of contention is the $1 trillion in aid to state and local governments in the HEROES Act. The HEALS Act does not include state and local government aid but offers to adjust how states could use funds provided by the Cares Act which passed in March.
An area receiving bipartisan support is the next round of stimulus checks. Although there are slight variations, the differences are minor, therefore, a compromise is expected. On the table with bipartisan support, individuals who earn a gross adjusted income of up to $75,000, head of household earnings under $112,500 and couples without dependents earning up to $150,000 would receive the full $1,200 or $2,400 payments, respectively. There is a phase out for higher earners at a reduction of $5 per $100 over the maximum earnings. The difference is dependents. The HEROES Act proposes $1,200 for each adult and dependent, with a maximum of three dependents per family. The HEALS Act proposes $1,200 for each adult and $500 per dependent with no limit. The bill would also prohibit creditors and banks from taking the payment to pay debts.
Here are the four components that may impact home care the most:
There are four areas in play which could most directly affect your home care agency.
1. Paycheck Protection Program (PPP) – PPP is also receiving bipartisan support with slight differences. The HEROES Act wants to expand eligibility, eliminate the 75% payroll requirement, and extend the application deadline to December 31, 2020. The difference in the HEALS Act proposal is an additional $190 billion into the PPP fund. This would expand the use of loans for forgiveness for businesses that have less than 300 employees and can show at least a 50% reduction in gross revenues during the pandemic. There is a push from the International Franchise Association to reduce that amount to 25%. With the bipartisan support, it is likely another round of PPP loans will be available. Home care agencies who wish to take advantage of this next round should build a relationship with an SBA lender, talk to your payroll company, and document your loss of gross revenue. Preparation will allow you to apply as soon as it becomes available.
2. Unemployment Bonuses – Both proposed packages include additional unemployment payments. The Heroes Act seeks to extend the $600 per week bonus payment until January 2021. The Heals Act extends benefits based on 70% to 75% of lost wages, starting at $200 a week and over time increasing to $500 a week with state assistance. (At the time of this writing, negotiations are indicating that there could be a compromise at $400 per week.) On August 8, President Trump signed a series of executive actions including suspending payroll tax collections and federal support for unemployment benefits at $400 per week in which states must pick up $100 of the $400. Several states have pushed back due to lack of available funds. The payroll suspension is expected to take affect September 1, 2020 if a deal is not reached for the next relief package. It is likely some form of unemployment bonus will continue through the rest of the year. Home care agencies should evaluate their caregiver recruitment plan. A full-time focus is needed to combat the caregiver shortage. Today, it will take thinking outside the box—looking beyond the traditional caregiver recruitment methods. For example, reach out to those displaced in other service industries and set up weekly training classes for those interested in caregiving.
Included in the HEALS Act only:
3. Liability Protection for businesses – A proposed rule to shield businesses from lawsuits who make good faith efforts to protect their employees and customers from contracting COVID. This would extend through 2024 and apply retroactively to December 2019. The White House supports liability protection being included in the next round but would be willing to accept a deal that does not include enhanced legal protection. Those in favor of the liability protections believe it will allow businesses to operate without the risk of an employee or customer claiming they contracted COVID related to their business and taking legal action. Most in Washington are unsure if this will make the final package. In the meantime, protect your business, staff, and clients by following the CDC guidelines and documenting your efforts. Temperature checks and health checks for your caregivers prior to each shift can demonstrate to your staff and clients that you are taking precautions. In The Know, an online caregiver training platform, has a free COVID caregiver training with a certificate. If you’re a VCC Partner Provider and have not trained your caregivers, let your Account Manager know and they will provide you with the training kit.
4. Healthy Workplace Tax Credit Act – This is intended to help businesses continue to reopen while ensuring the safety of employees and consumers through a refundable tax credit against payroll taxes for 50 percent of the costs incurred by a business for increased testing, personal protective equipment (PPE), disinfecting, extra cleaning and reconfiguring work spaces to adhere to social distancing guidelines. This would encourage and enable businesses to take the recommended steps to prevent the spread of COVID-19 in their workplaces. It’s worth noting that this would include a limit to a maximum of $1,000 per employee for a business’s first 500 employees, $750 per employee for the next 500 employees, and $500 for each employee thereafter. If this passes it should ease the burden agencies have incurred in order to protect staff and clients.
Congress is currently on recess with their break from Capitol Hill lasting until Tuesday, Sept. 14. Congress has been asked to be on standby to return to Washington if a deal is reached. Speaker Nancy Pelosi has made it clear the stimulus package needs to be at $2 trillion before negotiations can move forward. The Senate remained in session this week, but without a deal allowed senators to leave Washington, D.C. The Senate is expected to return in September unless a deal is reached. The challenge in all this is that Majority Leader Senator Mitch McConnell does not have a majority vote to pass the HEALS Act, which is why he needs the support of Democrats within the Senate. In the media, both sides of the aisle have signaled a willingness to start talking again. Although the White House and Democratic leaders have not scheduled a date to resume, Bloomberg reports that talks are happening at the staff level to reach an agreement on how much money the two sides are willing to spend.
What can you do?
Write your Member of Congress and/or Senator and let them know where you stand on these issues. You can locate your U.S. Representative by visiting https://www.house.gov/representatives/ or your U.S. Senator at https://www.senate.gov/general/contact_information/senators_cfm.cfm
Sources: Home Care Association of America, Forbes.com, International Franchise Association, Newsweek, Cnet.com, Bloomberg.com, portman.senate.gov