Home Health & Hospice Week

Simplified 1-page application should be coming soon.

Whether you’re applying for a Paycheck Protection Program loan for the first time or are seeking a “second draw,” the Small Business Administration’s COVID-19 relief program is once again open for business.

Recap: The latest COVID-19 relief package signed into law on Dec. 27, 2020, puts $284 billion more in PPP funding up for grabs for eligible providers. Although PPP loans will mostly look the same as in the first round last year, there are some significant differences such as allowing borrowers to receive second-draw loans and allowing more expenses to count toward eligibility for forgiveness (see HCW by AAPC, Vol. XXX, No. 2 for more details).

As required by law, the SBA issued an interim final rule on Jan. 6 implementing the now-named Economic Aid Act PPP provisions. “In reality, there is not much new in the IFR that was not addressed in the Economic Aid Act,” notes Stephen Thimons with financial advising firm Schneider Downs in online analysis.

However: The SBA issued another rule on PPP loan forgiveness that does offer a little more clarity on one point, note attorneys with law firm Seyfarth in online analysis. “Your ‘loan forgiveness covered period’ is the period beginning on the date the lender disburses the PPP loan and ending on any date selected by the borrower that occurs during the period (i) beginning on the date that is 8 weeks after the date of disbursement and (ii) ending on the date that is 24 weeks after the date of disbursement,” the rule says.

In other words, “PPP borrowers can select a covered period that ends at any point between 8 weeks and 24 weeks after loan disbursement, without having to choose between 8 and 24 weeks,” the Seyfarth lawyers highlight.

Another important point of confirmation comes on the loan forgiveness simplification process. “To the joy of many PPP borrowers and lenders, the Economic Aid Act provides that the SBA will release a single page certification form to be completed by borrowers of PPP loans of $150,000 or less,” says attorney Christine Price with law firm Moritt Hock & Hamroff in online legal analysis. The former threshold for the simplified forgiveness process formerly was $10,000. “This will greatly expedite the loan forgiveness application process for over 86 percent of First Draw Loan borrowers … by reducing the paperwork, time, and expense that borrowers (and lenders alike) have to spend on the forgiveness application,” Price says.

Timeline: “The SBA has to release this single page certification form on or before January 20, 2021,” Price notes. “For those borrowers with loans greater than $150,000 the loan forgiveness process remains unchanged,” she adds.

Beware: While the one-page forgiveness application with the much higher threshold will make life easier for many, it doesn’t leave you totally off the hook for documenting your forgiveness eligibility. “Borrowers must maintain all relevant documentation,” even if they don’t submit it, the Seyfarth attorneys caution.

On the front end, “we anticipate that [the loan application] process will be significantly more streamlined than it was last April due to many lenders having the experience and an established platform to provide these loans to their customers,” says Emir Hodzic with VonLehman & Co. A revised five-page first draw loan application and a six-page second draw loan application are now available on the SBA website.