Bipartisan Legislation Would Waive SBA Affiliation Rules for Small Health Care Facilities
U.S. Senators Roger Wicker, R-Miss., and Tina Smith, D-Minn., today announced the introduction of the “PPP Access for Rural Hospitals Act,” (S.310). This legislation would waive the Small Business Administration (SBA) affiliation rules for non-profit critical access hospitals and hospitals that serve rural areas so they may qualify for Paycheck Protection Program (PPP) loans.
“Since the onset of the coronavirus pandemic, our nation’s critical access hospitals and rural hospitals have continued to provide care to some of our nation’s most vulnerable populations despite facing substantial increases in operating costs,” Wicker said. “Ensuring these vital facilities are able to apply for financial relief through the PPP will mean they can continue to serve their communities as we work to defeat this virus.”
“Rural hospitals are vital to public health – they’re economic engines for communities in Minnesota and states across the country,” said Smith. “As hospitals across the country continue to face the pandemic, they need financial support. We are again introducing our bipartisan bill to make non-profit, rural, critical access hospitals eligible for the Paycheck Protection Program. We have to keep fighting for rural areas and advocating for the support they need.”
The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) established the PPP to provide immediate relief to small business owners with fewer than 500 employees in the form of forgivable loans. Many small hospitals operate as part of a larger health system that exceeds the 500-employee limit under SBA’s affiliation rules, making these smaller hospitals ineligible for PPP.
In addition to dealing with increased costs for staff, personal protective equipment, and other safety measures as a result of the COVID-19 outbreak, hospitals and medical facilities have lost significant revenue because of restrictions on elective procedures. Many hospitals already operate on thin margins and the pandemic placed them under even greater financial stress.
Granting rural hospitals access to the PPP program would allow facilities to retain critical staff and focus their resources on providing quality care to patients for the duration of the pandemic.