The most current update regarding our crisis status with Covid-19 and what we can be doing to access the government aid provided to us. The dental field is being hit hard and we want to help! Listen in to Dr. John and Wendy while they dive into these different options and how we can get started finding relief during this trying time.
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"EP63: Legislation Regarding Covid-19 & What You Need to Know: A Breakdown of the CARES Act" Transcript:
Hey, Dr. John. Always good to see you.
Good to see you too. We've got our COVID update for today, and there's a lot of stuff going on. So we're going to do, first of all, a Carers ACT update. What's in all three phases of the legislation regarding coronavirus, and then we'll do a quick disease update. So we were thinking Uncle Sam would come to save the day, and they've done some really good things, I'll have to say. So first of all, I want to say, we're not giving legal advice or tax advice that you should get personal advice on your particular situation in your state, in your locality, from competent advisers. The information that we're going to present can and probably will change. And I'm only doing the information that is most relevant for dentistry. And you'll want to stay tuned for updates as the rules are still being written, the processes are still being written. So stay tuned.
So phase one of the relief bills. All right. Wendy, how about there? Can you see it now?
That's great. Yep. Love it.
All right. Thanks for letting me know. So phase one bills, it changed the tax filing deadline from April 15th to July 15th. It added industry support. So this means dollars for healthcare providers and suppliers so that they could ramp up their response to COVID-19. And they provided emergency SBA loans for small businesses. So those loans are up to $2 million dollars, up to 30 years to pay off. And if you want to know about those, here's the website to check. Now, these are SBA loans through the SBA. And so these take a while to take place. There's a lot of hoops to jump through. Money probably not available for another eight weeks or so. So these are kind of challenging to get through all the hoops properly. But there's certainly a source. I'm going to be talking about the second set of emergency loans in a minute. That might be more appropriate for most of us in dentistry.
So the phase two bill provides expansion to paid sick and family leave. So I'll talk more about that in a minute. So the federal tax credits would reimburse via employment tax credits. So how this works is the employer is on the hook to pay for this sick leave and family leave. But they can claim credits on their employment tax. So the next time you file your employment tax, your quarterly tax, you can take tax credits against what's due at that time. So this is for employers under 50 employees. I'm sorry, this is for employers under 500 employees. If you're under 50 employees, you can ask for an exemption if it threatens the survival of your business.
So here's what's in it. Sick leave, employees are entitled to 10 weeks of job-protected leave, if they've been exposed or exhibit symptoms of the virus, or if they're quarantined by a healthcare provider. Next, if they need to care for a symptomatic or exposed family member. Next, if they need to care for a child under the age of 18 due to school closure and lack of available child care. And the first 10 days of this would be unpaid, then the employee will be paid according to their normally scheduled hours at two-thirds of their regular rate. Okay. So this is a big expansion of the Family Leave Act because this includes being off for child care. Many places, school has been canceled for the rest of the year. So that's taking this out into mid-May, end of May, something like that, for those folks.
And if you think about the makeup of most of the teams of dental practices, this is a big one. I think there's a lot of our members, a lot of the practices, that are going to be hit by that because of the child care and the school closures. If you think about the typical age of hygienists and assistants and even people at the front desk, there's probably a lot of practices that are going to need to know how to maximize this role.
For sure. And this is going to affect our workforce. As these restrictions are lifted, we may be able to see patients, but not have a team in place to do it. So this is going to be very, very tricky as we move through this. So phase three of the relief bills-- oh, I should say there are a bunch of additional rules and limitations. And I'll give you a resource here before we're done so that you can see what those additional rules and limitations are.
So the phase three bill provides emergency loans. So these are a different set of loans. And these are not through the SBA. I'll talk a little bit more about this. If you want to find out, there's a great summary of this from the United States Chamber of Commerce. And if you search Chamber of Commerce emergency loans, you'll come up with this PDF that has a fantastic summary of the emergency loans. So that's a great source for you. The phase three also provides support for banks so that they have the-- so they could gear up in order to manage these emergency loans. It also has rules on mortgage forbearance, so not paying your mortgage and not having a whole lot of consequence from it. So that's single family and multi-family, if you have more than five units. So the multi-family forbearance for those of you who are in real estate investing, you'll want to look at the rules for that.
Okay. So let's talk about the emergency loans because I think that's the piece of this that most dentists are interested in and concerned about. Most of the practices, if it's 500 employees or less, are going to be eligible for these. And these are businesses that have had significant disruption to their ability to do business. And certainly, dentistry qualifies there. Now, the lending here, the loan will come directly from private lenders. So unlike the previous SBA loans, which goes through the normal SBA channels, this is going to go through private banks, which will speed this up dramatically. So if you have not already, you may want to contact your banker and let them know that you were going to be interested in these loans and ask them what their process is going to be. Now, my understanding is, that the rules for these processes has not been-- have been figured out yet. But we expect them to be over the next couple of days.
So the loans will come, like I said, from private businesses. Interest will not exceed 4%. And the thing about this, this will be forgiven later on. This will turn from loans to grants as long as you keep your employees. So these are to provide payroll support, mortgage and rent support, and utility support. So we will have a little worksheet for you on our next update to show you how to figure out what this would be. So this provides support for those things. That's payroll support, insurance premiums, qualified mortgage, rent, and utility payments. So those things, you can borrow that money on what you're going to pay for it in eight-week period of time.
So exactly the starting date of this, unknown, because we know that when a bill is passed, there's a 15-day waiting period before they take effect. So this is a super, super, super good deal that would highly support dentistry. And so you can get all the details by searching Chamber of Commerce emergency loans. You'll get all the details that are known right now. Like I said, the processes will be developed later on. So you will want to contact your banker and let them know that you will be interested in this. So this allows us to cover our staff, our mortgage, and really not cost us anything in this time that our businesses are largely shut down.
So employee strategies, now that we know what this loan looks like, we've got some options. One, same as usual. Just keep doing what you're doing; paying your employees whether they work or not. And keep doing what you did before all this came about. And so these loans are for a period of time that's upcoming. That's what's going on right now. They aren't retroactive. So if you're doing this up to now, you may want to keep doing that. Second option is laying off employees. Third option is furloughing them.
So layoffs, let's talk about that quickly. That means they are no longer employed, and they no longer have a job. There's no benefits. And they would then file unemployment. And they're now free agents. They're out there. You could rehire them at a later date if they're available. Remember, just weeks ago, the biggest problem the dental practices were having was employees. Finding employees, getting great employees. And so if you're laying them off, they do become free agents. And there are going to be people that want to pick up your best people. But if they're laid off prior to April 1st, they're no longer eligible for the rich FMLA expansion benefits.
Next step is furlough them. Furlough them, they remain employed. Their benefits are intact. You will have to pay-- you'll have to figure out some way for the employee to pay their portion of the benefits. And they will receive unemployment. Now, remember, the federal government added $600 a week in unemployment benefits on top of what people are getting from their state. So there are probably some employees that are going to be better off getting unemployment than being employed, which is a little upside down. And when they try to come up with a dollar amount that makes sense over the entire country, $600 goes only so far in San Francisco. But $600 in rural New Mexico goes quite a ways. So some of these things are a little bit upside down. But in getting something done and something done in a hurry, I think they did a really good job.
So I could tell you what a common approach is. We've had several meetings of our CEO group and the Spark Dental Group, which are small dental groups, and really lining out what they're doing. And here is a common approach. That they are keeping a skeleton crew to respond to emergencies. And those are kept as regular employees, paid their full wages. So we want to have that skeleton crew in emergencies and also someone to keep the revenue cycle activities going. Making sure that we are sending claims for the emergency care that we're providing, making sure that we're continuing to do all the things to keep whatever cash is available coming in.
So another common strategy is they're laying off their core performers. So those that have not done well, whose performance has not been good, or those who are in performance improvement plans. They are laying those off, with the thought being, "Well, they might be laid off or fired anyway. So let's go ahead and get them off there. If they get taken by somebody else, so be it." And then furloughing everyone else. So that's a pretty common circumstance for how to deal with employees. And virtually, everyone I know of is filing for these emergency loans. So pretty much, it's across the board.
So as always, if you're going to have an HR strategy, you want to make sure that you get competent HR advice for what's legal and possible in your state, in your locality. The laws are significantly variable around the country. So make sure that you connect with someone who understands what's going on in your state. The three groups that we have recommended are Bent Ericksen, Cedar, and Bambee, which is an online HR firm. So there we go. That is the update on all of the bills. Did that make sense, Wendy?
Absolutely. So helpful. And I know there's going to be a lot of questions. I had a few come through my head. But I didn't ask them because, like you said, they're currently writing the rules right now. And supposedly, we're supposed to have more information on those rules today. So we can always keep our fingers crossed and hope it's coming soon. And I'm sure we'll have more understanding. But I think that was really helpful for a lot of small practices that have been waiting to see, right? Because as you said, April 1st is kind of a deadline before they lay people off and all that. So it's timely that we now have more to share.
And banks want to give these loans. So I can tell you, this morning-- so I'm now Pacific time because Arizona doesn't do daylight savings time. I could tell you by 5:30 this morning, I had emails from our business bankers in all three banks that we use in our different businesses saying, "Hey. We're available. We want to loan you this money. We'll have the rules. We'll be able to tell you in a few days what the process is going to be for getting these loans." So banks want to do this. Go ahead and contact your banker to get more information about that. And I think it's going to be extremely helpful for our profession that's just been really wrecked by this. And grateful that the government put this in place. It's really quite a lot thought out.
Dr. John, we do have one question that you may have the answer to already. And maybe you don't. But [Dr. Wheeler?] asked if staff has already filed for unemployment, do we know if we can supplement that with the emergency loan amount? Do we know any of that yet? So if the team's already been laid off, do we have any idea what that means?
So if we have the-- so my understanding is that this loan amount is not for anything that's happened up to now. It's from the day that the loan moving forward, is my understanding. And so what's happened already doesn't matter, Dr. Wheeler. So if you were to hire everybody back on the date of the loan or whatever date that they say this begins, potentially, you could be paying them their full wage. And that would be forgiven because the loan would be forgiven. But the loan would pay for all of that, and it would be forgiven as long as you keep the same number of employees.
Interesting. I'm sure we'll be looking carefully about fine print, right--
Yep. That's right.
--as we always do with anything banking [laughter]. But it's good for them to, at least, understand what some options are.
It's still a little bit cloudy. It's getting clearer every single day. And I think as they continue to write the rules, it'll be much clearer. And in the past, I've always been a little dubious of government emergency help because I've had so many colleagues that have really struggled in actually getting the check. But in this case, the loan's going through the banks. I think this is-- I think they really did a good job and setting this up in a way that would be relatively painless, relatively quick, and really help the industries that have been hurt so badly by this viral epidemic.
Right. Another question was, can we back pay them? I suppose that would be an option. If you can prove that they were paid, that would be an option to maybe make sure that you're in a secure position. But I think some of those questions, as you said, once they release the rules, we'll know.
Yeah. My understanding is that this loan is not retroactive. So it's not going back to any particular date. It's at a certain starting date. Again, the rules will be written. We'll have more clarity as time goes on.
So still with the virus, we have rapidly evolving information, although the evolving is going a little slower than it has been. Just kind of our update, our daily new death rate, which is a horrible statistic to use as a parameter. But you can see yesterday's number was significantly down. Now, one day doesn't make a trend. So don't read too much into that. You may remember last week, we had three or four days where it trended downwards and then went up dramatically. So one day doesn't make a trend. I hope it's the start of a trend, for sure. It's such a sharp dropoff. I don't believe it's really the start of a trend. There's probably some recording inconsistency in there. And I wish tomorrow looked as far down as yesterday did. But I'm not going to hold my breath on that.
What's the explanation of this graph? I like it. Now, I can guess what it means. But I'm not sure. And Wendy, you are frozen up. So I don't know if that's you or if that's me. But I'm just going to keep going. Here, what I believe this means is that because of the testing was inconsistent early, I think this is showing that the testing is getting more and more consistent. And the number of positive tests as a part of that are getting more consistent. And that the general percentage of positive tests is going down slightly. And so that's what I believe this graph is showing. And Wendy will pop on here in a minute. We'll go back and ask her.
So some other data that, I think, is interesting is, again, we've been talking about how some of the data's shown by the health experts is data that is intended to frighten people, frankly, because they want people to do social distancing, which certainly makes sense in the circumstances in much of the country, if not all the country. And so the statistics they show are similar to what you see on the blue bars here. And this is total cases. This is total cases of the coronavirus in the State of Oklahoma. You can see those numbers are going up and up and up and up. But if you look at new cases, right, so that's telling us how many people are getting it, and we know the disease lasts roughly about 8 or 9 days. If you have it, they're saying a 14-day quarantine.
So you could see, according to this data, that in Oklahoma, it appears that the coronavirus peaked-- the new cases peaked four days ago. Now, there's probably some lag between when they're actually identified and when they're recorded. So the dropoff may not be as significant as it looks. But you can see that the two-- looking at the two sets of data, or the same set of data, but how you're talking about it, is it cumulative cases, or is it new cases? It gives you a totally different picture.
And the same with deaths. Again, this is Oklahoma from March 7th to the 29th. And you can see the graph showing total, which is the blue graph. You can see it looking absolutely gigantic. But if you look at daily new deaths, a couple of days ago, had high number of deaths, seven in one day; every one of these deaths is tragic obviously. But you can see that the number of deaths are all over the map and don't really reflect that blue bar graph. So keep that in mind. I'm not saying don't be safe and don't have social distancing. But I'm saying the data that you're seeing is presented in a way to make it look extreme.
Some other things that we're learning. No big surprise here. COVID-19, you are one and a half times as likely to get it if you're a smoker. You're two and a half times more likely to die if you're a smoker and you had this disease. Unemployment claims. I thought this was fascinating. Number one industry, restaurants. Number two, hotels. Number three, dentist offices. We've really been hammered by this. And looking at these unemployment claims, you are going to see dental offices shoot up, as you will, probably in these other industries as well as they're trying to beat the April 1 deadline for the more extravagant employee benefits, the EFMLA.
So next thing, another anecdotal story that certainly isn't any scientific study, but I like it. And that is that there is a board-certified family practice doc that had 699 cases. Now, that's a lot of cases. And I looked this up. I found the source multiple places. So this is probably true. But that's a lot of cases for one doc. 100% success using hydoxychloroquine, sulfate, zinc, and Z-Pak. And really, the symptoms of shortness of breath resolving really quite quickly. So my hope is that these anecdotal reports of this become science and become really a powerful treatment for the virus.
Dr. John, I'm back. Sorry about that. That was crazy.
Hey. Hey. Glad to have you back, Wendy [laughter].
I just read a report, too, the FDA did approve emergency use of those two medications for the COVID-19. I know there were some states that were elected to use them because they were not FDA approved. So they kind of fast-tracked FDA approval, given the circumstances. I think that's the news as well.
Absolutely. I know many people were using them off of FDA approval, given the emergency situation at a deal like the risk of the medications is worse than the risk of the disease in people who are either super high risk or super sick.
And so dental office staying open during a pandemic helps saves women's lives. Dental infections can be very, very serious in people that are immuno-compromised. They can be absolutely deadly. Even people who aren't immuno-compromised. So us being able to provide emergency care is not only legally required, but certainly, from an ethical and moral standpoint, it certainly is. So it makes a difference when we stay open.
And then here we go. Here's our buddy Inky Johnson. Wendy, do you want to tell a story?
Well, I mean, we had him speak for our annual Champions of Dentistry Summit a couple of years ago. And he was just such an inspirational speaker. And those who don't know Inky, I know several people listening live got to meet him and visit with him a little bit. Obviously, he had a plan for his life, but ended up being different. He was maybe I think it was just a handful of games away from being expected to go in the first round of the NFL Draft. And he suffered the injury that caused him to lose the use of his right arm, and he never regained that. And he almost died. So he ended up being very grateful that he had his life. But obviously, his entire family, his entire career he had been building towards that outcome, going and playing in the NFL and being drafted high, which was obviously, a much bigger paycheck than he'd ever be able to get another way. But his quote's, I think, very inspiring. He said, "Someday you will look back and understand why it all happened the way it did." And to hear him speak and share his message, sometimes you have to go to plan B. It was never your-- often, it's not a conscious decision. Hey, we're going to close our practice down for the next eight weeks. That was never in our plan. But someday, we might look back and have a greater perspective and be able to recognize our growth and our perseverance and our resourcefulness in getting through the challenge. And so he goes on to say, "There's a bigger plan. A setback today is prepping you for a comeback tomorrow. Keep going. The best is yet to come."
I think that says it so well. This, too, shall pass. We just have to hang in there, everybody. Fortunately, there's a lot of help coming from the government, and we will be back with more information for you. So this week, we are moving to Monday, Wednesday, and Friday for these updates. Again, we'll give three strategies on how to get through this. We'll give a quick disease update. What is the data really showing? And we'll do any employment regulatory update. So next time, we will show a little worksheet that you can use in order to figure out what kind of loan might be available to you with the emergency loans that are becoming available.
But even better than that is, every day this week at 2:00 PM Eastern, our coaches are getting on and teaching some type of system. So we're kind of looking at what people are needing, what people are struggling with. And our coaches did a fantastic job earlier today. Didn't they?
They did. They were talking about systems that every practice is going to need. When you get back and you finally get the green light, you're going to have way more patients demanding care for services than you can probably accommodate. So they were talking through a hygiene blitz which is the subject that we teach when you're at a capacity. And those strategies and every system that they're going to be talking about this week is what I would consider an essential system to really help you come back stronger than ever.
Yep. Very good. All right. With that, Wendy, thanks so much. And we'll see everybody on Wednesday.
Thanks for listening, everybody.
If you enjoyed this and you found the information valuable, please share this on your Facebook page so that more people have access to it. I interrupted you, Wendy. What were you saying?
I was just saying thanks for joining us. Glad to have everybody join.
Okay. Thanks everybody. Hang in there. [music]