COVID-19: Cares Act Overview

The Coronavirus Aid, Relief, and Economic Security Act (CARES) provides an estimated $2 trillion stimulus package to battle the harmful effects of the COVID-19 pandemic. Here are the top 10 key takeaways:

1. Provides stimulus to individuals, businesses, and hospitals in response to the economic distress caused by the coronavirus (COVID-19) pandemic.

2. Creates a $349 billion loan program for small businesses, including 501(c)(3) non-profits and physician practices. These loans can be forgiven through a process that incentivizes companies to retain employees.

3. Allocates $500 billion for assistance to businesses, states, and municipalities, with no more than $46 billion to support passenger air carriers, air cargo carriers, and businesses important to maintaining national security. The remaining $454 billion may be used to support lending to eligible businesses, states, and municipalities.

4. Allocates $130 billion in relief to the medical and hospital industries, including for medical supplies and drug and device shortages.

5. Expands telehealth services in Medicare, including services unrelated to COVID-19 treatments.

6. Provides $1,200 to Americans making $75,000 or less ($150,000 in the case of joint returns and $112,500 for head of household) and $500 for each child, to be paid “as rapidly as possible.”

7. Expands eligibility for unemployment insurance and provides people with an additional $600 per week on top of the unemployment amount determined by each state.

8. Expands the Defense Production Act, allowing for a period of two years when the government may correct any shortfall in resources without regard to the current expenditure limit of $50 million.

9. Provides the Secretary of the Treasury with the authority to make loans or loan guarantees to states, municipalities, and eligible businesses and loosens a variety of regulations prior legislation imposed through the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Economic Stabilization Act of 2008, and others.

10. Accompanied by supplemental appropriations to help the government respond to this pandemic.

Source: ReedSmith