Caravan Health is urging Congress to let rural hospitals fully participate in the new Small Business Administration’s loan programs authorized in the CARES Act. Congress will have to act soon to add more funding to the popular Paycheck Protection Program, and rural hospitals should not be left out. These facilities are the frontlines in the fight against COVID-19 and often the sole source of care for many miles around rural and underserved areas.
The CARES Act provides forgivable loans to businesses with 500 or fewer employees - a limit which includes all the employees of the business’s affiliates. This means that small rural health systems with multiples sites may not be eligible for the funds, even though the individual hospitals are small and in dire need of additional funding. Congress included an exception to these affiliate rules for certain hospitality and food service businesses and franchises and should extend the same treatment to hospitals.
Further, municipal-owned entities are not eligible for the loans provided under the SBA. Nearly one-third of rural hospitals are owned by local governments. Congress should also remedy this exclusion so that rural hospitals can continue providing life-saving care during this public health emergency.
Rural hospitals are critical to our health care system and must be protected. They provide a full complement of health care services and treat challenging and unique patient populations at higher risk for complications from COVID-19. For example, rural Americans have higher rates of chronic or life-threatening diseases, such as diabetes and coronary heart disease, than those in urban areas.
Before the full onset of COVID-19, an increasing number of rural hospitals were closing, causing access issues for residents of rural communities. The impact of these closures, which are continuing, are only amplified during the current pandemic. Congress should act now to preserve access to lifesaving care for rural America.
Learn more about Caravan Health's effort to support providers during the COVID-19 pandemic. Visit our COVID-19 resources page.