Coronavirus Aid, Relief, and Economic Security (CARES) Act
CARES Act Deconstructed for Your Practice

The $2 trillion Coronavirus Aid, Relief, and Economic Security (CARES) Act, signed into law on March 27, 2020, contains significant relief to assist health care providers faced with the double burden of an onslaught of COVID-19 patients and a drop in elective and non-urgent services. This assistance ranges from outright grants, to provisions significantly affecting the Medicare program, to modifications of group plan coverage and payment terms.

The CARES Act makes $100 billion available to the Public Health and Social Services Emergency Fund (the “Fund”) to reimburse eligible health care providers for health care-related expenses or lost revenues that are attributable to coronavirus. The Act defines “eligible health care providers” as public entities, Medicare or Medicaid enrolled suppliers and providers, and other for-profit and nonprofit entities specified by the Secretary of Health and Human Services (HHS) that “provide diagnoses, testing, or care for individuals with possible or actual cases of COVID-19.” However, the single paragraph of the CARES Act that establishes the $100B fund is quite vague, leaving the HHS Secretary Alex Azar (Secretary) with a major role to play in distribution decisions. Some things we do know from the text:

  • Application: Eligible health care providers must submit an application to the Secretary that includes their tax ID number and “a statement justifying the need of the provider for the payment.” Applications will be reviewed by the Secretary on a rolling basis. There is no further instruction as to how to apply.
  • Reports and Documentation: Recipients will be required to “submit reports and maintain documentation as the Secretary determines are needed to ensure compliance with condition that are imposed.”
  • Fund Distribution: The Act does not indicate how or when the money will be disbursed, except that it will be “through grants or other mechanisms”, that payment includes “pre-payment, prospective payment, or retrospective payment, as determined appropriate by the Secretary,” and that it will be through “the most efficient payment systems practicable to provide emergency payment.”
  • Expenses or Lost Revenues: Provider expenses that may be reimbursed include expenses relating to “building or construction of temporary structures, leasing of properties, medical supplies and equipment including personal protective equipment and testing supplies, increased workforce and trainings, emergency operation centers, retrofitting facilities, and surge capacity.” The Act does not explain how the Secretary will view “lost revenues”.


Key Highlights for Healthcare Providers:

  • $349B Small Business Loan Program – In the health care sector, the “Paycheck Protection Program”(PPP) may be particularly helpful for smaller physician practices and dental practices. The PPP covers the period from February 15, 2020 through June 30, 2020 and allows qualifying businesses to borrow money for a variety of qualified costs related to employee compensation and benefits. The legislation greatly expands the number of businesses (including non-profits and physician practices) that are eligible for loans through the Small Business Administration’s (SBA) 7(a) loan program and increases the maximum amount for such loans. Approved 7(a) lenders can issue the covered loans if they determine a business was operating with salaried employees or paid contractors as of February 15, 2020.
  • Telehealth – The CARES Act greatly expands the availability of telehealth services past the expansions already authorized under the Families First Coronavirus Response Act, in order to further facilitate the provision of care during the COVID-19 emergency, including for telehealth services beyond diagnosis and treatment for COVID-19. The Federal Communications Commission will receive $200 million to provide telecommunications and information services and devices. Restrictions on health savings accounts have been waived to allow high-deductible health plans to cover telehealth services without a deductible. The CARES Act removes the existing requirement that a Medicare beneficiary have a preexisting patient/provider relationship in order to be treated through telehealth. The CARES Act also enables federally qualified health centers and rural health clinics to be sites for telehealth consultations, and enhances payments for such telehealth services provided during the emergency period. Various Medicare face-to-face requirements, such as for home dialysis patients, home health, and hospice care, have been waived for the duration of the emergency. The CARES Act also appropriates $25 million for telemedicine and distance learning in rural areas.
  • Medicare and Medicaid Coverage and Payment – The CARES Act suspends Medicare “sequestration”—the current across-the-board annual 2 percent reduction in Medicare payments—from May 1, 2020, to December 31, 2020. Even more powerfully, direct Medicare payments for Medicare beneficiaries hospitalized with COVID-19 during the emergency are being increased by 20 percent. The CARES Act also significantly expands eligibility for, and the benefits of, accelerated and advance Medicare payments, particularly for those hospitals experiencing significant cash flow challenges, and relaxes various rules related to such accelerated payments. The Centers for Medicare & Medicaid Services has announced immediate implementation of these particular changes. COVID-19 vaccines will be covered by the Medicare program without any Medicare beneficiary cost share and before application of the Part B deductible. Medicaid will cover diagnostic products for COVID-19 even if not approved by the Food and Drug Administration (“FDA”). The CARES Act further delays the $4 billion Medicaid disproportionate share payment reduction for hospitals until November 30, 2020, also pushing back the reductions in each succeeding year through 2025. States have been granted the option to expand Medicaid coverage of COVID-19 diagnostic tests and related services to uninsured individuals who would not otherwise qualify for Medicaid. However, the CARES Act does not expand health coverage to include COVID-19 treatment more generally to uninsured individuals.


The CARES Act provides many levels of protections and assistance to see your practice through this crisis. Please see the attached link if you would like to review the bill in its entirety.

Client Experiences

“It’s difficult to unexpectedly shut down any company for a few days. But when you’re in a relationship-based industry taking care of clients’ live animals, the business always needs to be up and running, no matter what the circumstances are. A lot of other animal service providers shut down after the storm and we ended up taking on many of their clients because of it.”

Scott Smith

Owner, Biscuits & Bath

“We have eight sites and no full-time IT staff. I can’t be in every location when an issue comes up,” says Pat Cunnane. “I can always call ITelagen and know that they will quickly help wherever we need it.”

Pat Cunnane

Executive Director, Allergy and Asthma Associates of Northern California



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