A small business COVID-19 lifeline: CARES Act

The CARES Act offers real immediate assistance to small businesses struggling with the uncertainties generated by the ongoing health and economic crises due to COVID-19. Discuss this with your own tax and legal advisors. I have provided a number of links below that I have found useful in my own research.

TL;DR - There is a extraordinary small business lifeline in the CARES Act, specifically the Paycheck Protection Program, which can turn a guaranteed small business loan into a tax-free grant equal to approximately 8 weeks worth of business operating expenses.

We have spent the last couple of weeks dissecting the effects of the Families First Coronavirus Response Act (FFCRA) on small businesses that are grappling with a shocking loss of business due to the COVID-19 pandemic. Layoffs, furloughs, reductions in hours -- and their resulting effect on employee benefits -- all of these small business survival responses demanded immediate attention as business owners scrambled to simultaneously protect their businesses, their families, and their employees.

Following the signing of the CARES Act on Friday, I believe the next two weeks are going to focus on small businesses accessing a massive cash infusion designed to bring employees back up to full-time pay, at least through the end of June (even if unable to full-time work due to shelter-in-place restrictions).

For businesses that use the loans to ensure employees keep their jobs and returned to full pay (including the rehire of laid-off employees, where applicable), can have the portion of the loan that is equal to 8 weeks of certain business operating expenses forgiven (not required to repay). Specific operating expenses include:

  • Payroll (with caps at $100K+ annual comp, and not including payroll taxes)
  • Rent, mortgage interest, utilities
  • Group health insurance benefits

In addition, small businesses that are suffering a 50% or more loss in revenue vs. the prior year (calculated by calendar quarter) may be eligible for up to $5,000 per employee payroll tax credit. These tax credits are separate from the payroll tax credits offered under the FFCRA's emergency sick leave and FMLA benefits. It is our understanding that businesses cannot benefit from this tax credit and the Paycheck Protection Program.

In short, while the FFCRA was designed to provide immediate sick leave and family protection for employees, the CARES Act is designed to keep American businesses going through the end of June.

Below is a collection of the most helpful resources I have found. I recommend you review and discuss with your tax and legal advisers as soon as possible.

Best overviews of CARES Act:
U.S. Chamber of Commerce Small Business Guide and Checklist
U.S. Senate Committee on Small Business & Entrepreneurship

Immediate analysis from national law firms:
Gibson Dunn (specific focus on the Paycheck Protection SBA loan program)
Skadden (a little more dense/detail than the other links)

Third party analysis:
Forbes - Peter J. Reilly - Paycheck Protection Program

I hope you find this helpful, and I am happy to discuss any of this with you, and in particular what it means for your ability to retain employees and to continue their employee benefits.

CARES Act restores OTC medications as eligible expenses

The CARES Act, signed into law Friday, March 27, 2020 restores over-the-counter medications as eligible expenses for Health Savings Accounts (HSA), Flexible Spending Accounts (FSA) and Health Reimbursement Arrangements (HRA), without a prescription, retroactive to January 1, 2020.

The law also incorporated several, healthcare related tax benefits:

  • Menstrual care products added as eligible expenses for these qualified accounts
  • Allows tele-health to be covered at no cost on HSA-compatible HDHP plans, through December 31, 2021
  • The IRS has also ruled the elimination of cost-sharing for COVID-19 related treatment does not disqualify HDHP medical plans from HSA-qualified status

More details here from our partners at Discovery Benefits. And a great summary analysis of the CARES Act from SHRM, here.


doctor mobile phone

Accessing health care from home: tele-health options

There are probably a dozen good reasons to check out your medical plan's tele-health options right now, but at the top of my list would be avoiding an in-person visit to a medical facility (to protect yourself and others) and reducing the overall strain on the health care system and providers.

And yet, we all need care -- including (or especially) mental health care. All of our CA group medical plans include options for tele-health visits. Even if you don't need this right now, consider checking out your carrier's resources (and registering or downloading the app, where needed) so that you are prepared to access care if you do need it.

In response to the COVID-19 pandemic, some carriers have begun to waive tele-health fees (Aetna, Blue Shield so far). Otherwise, tele-health visits and care are generally subject to normal plan office visit and/or Rx copays. We have compiled links and helpful documents here, and will continue to add more.

24/7 Nurseline for telephone consultation (all carriers - call number on back of medical ID card)


Anthem Blue Cross of CA

Blue Shield of CA (access from Blue Shield online account)

  • Teladoc services (need to access from within Blue Shield online account)

Cigna (access from mycigna.com online account or app)



Sutter Health Plus

United Healthcare (set up your myuhc.com account first)

Western Health Advantage

Health Carrier Responses to COVID-19

On March 5, Governor Newsom directed California health insurance carriers to waive all patient costs related to testing for COVID-19 (novel coronavirus). This includes medically necessary lab tests and associated clinic, emergency room, and/or medical staff fees. Notably, it generally does not waive costs for subsequent treatment, in the event of a positive test. In general, treatment will be covered under the normal rules and structure of the patient's health plan.

Carriers we know to have reached out directly to employer clients and covered individuals, between March 5th and March 9th:

We have not yet seen specific communications from United Healthcare, Aetna or Health Net. However, Aetna and Health Net have posted confirmation that copays/cost-sharing is waived for medically necessary services related to COVID-19 testing:

United Healthcare surprisingly does not yet appear to have complied with the Governor's direction.

This is an excellent time to remind employees that all employer-provided health plans include one or more versions of tele-health services, from 24x7 nurse lines to video visits. These can be excellent options to help deal with other minor health issues, to get necessary care and prescriptions, without having to physically visit a doctor's office or medical facility. If you or your team are unsure of how to access the tele-health options included in your plan, please reach out to your Allpointe benefits support team.

We encourage all of our clients and employees to follow the CDC guidelines with respect to preventive measures in the workplace, at home, and for travel.

Viewing a new company benefits document in Ease

Throughout the year, various benefits-related documents may get updated, or become newly available. Important documents requiring review or signature from the employee, will be posted along with an email notification from Ease. The next time the employee logs in to their Ease portal, the required action is clear, and the first thing they will see:



Employees are not able to complete any other benefits-related actions, including annual open enrollment, new hire enrollment, qualifying events, or other changes until the required review has been completed.

For small employers, this is an easy, streamlined way to maintain benefits compliance.

For employees, necessary documents are easily viewed at any time, from any computer, tablet or smartphone, and the documents remain available for future detailed review at the employee's convenience.

Cigna/Dignity Health Contract Ends January 1st

Cigna and Dignity Health (Common Spirit Health) continue to negotiate a renewal, while their current contract ended January 1, 2020. This means Dignity Health providers in California and Nevada are no longer in-network for Cigna's Open Access Plus (OAP) plans. There are some temporary continuation of coverage accommodations for patients in active treatment for certain health conditions. Notable Dignity Health providers in the San Francisco Bay Area:

  • St. Francis hospital (San Francisco)
  • St. Mary's hospital (San Francisco)
  • Sequoia hospital (Redwood City)
  • GoHealth urgent care (multiple locations)

Read more:

San Francisco Business Times

Dignity Health

There are no guarantees, but historically we have seen repeated patterns where insurance carriers and large health systems know that they ultimately need each other, and will eventually resolve contractual differences. Putting patients in limbo -- with minimal notification -- in our opinion, is reprehensible. We would encourage employers and patients who are affected and motivated, to consider making themselves heard by speaking out: to Cigna, to Dignity Health, and to your elected representatives.

Counting Employees to Determine COBRA Status

We were "right around 20" employees this past year.

Most employers are well aware that there is a 20-employee threshold determining whether their group health plan is subject to federal COBRA or to state continuation coverage, such as Cal-COBRA. Far fewer employers are certain of exactly how to count to 20. And no wonder: the federal government alone requires multiple counting methodologies to determine ACA compliance, COBRA, Medicare as Secondary Payer (MSP), and FMLA, just to name a few.

California and the City of San Francisco also have laws and ordinances which require employee counts, adding even more complexity to that spreadsheet file you just exported from payroll. Apply the same methodology to determine employee counts for all of these, and an employer is certain to either a) spend time and money voluntarily complying with a non-requirement; or b) put their organization at risk by failing to comply with a local, state or federal requirement. Either scenario can be costly.

Is it really that big of a deal?

In general, COBRA requires group health plans to provide continuation coverage to employees, former employees, and their eligible dependents. Messing up someone's access to continued access to health insurance is not something that goes unnoticed. Think about some of the common reasons people qualify for continuation coverage under COBRA:

Loss of employment. Divorce or legal separation. Reduction in work hours. Death of the covered employee. Serious, stressful stuff. So, let's get this right.

OK, is my group health plan subject to COBRA?

COBRA generally applies to all private-sector group health plans maintained by employers that had at least 20 employees on more than 50 percent of its typical business days in the previous calendar year. Both full- and part-time employees are counted to determine whether a plan is subject to COBRA.


Got it. So, we have 15 full-time employees and 10 part-time employees. I guess we need a COBRA administrator.

Well, maybe. But maybe not. Reading a little bit further:

Each part-time employee counts as a fraction of a full-time employee, with the fraction equal to the number of hours worked divided by the hours an employee must work to be considered full time. For example, if full-time employees at Company A work 40 hours per week, a part-time employee who works 20 hours per week counts as half of a full-time employee, and a part-time worker who works 16 hours per week counts as four-tenths of a full-time employee.

My calculator is smoking. Where can I get more detailed information?

The Dept of Labor's Employer's Guide to Group Health Continuation Coverage Under COBRA is a good start. Need additional help? Reach out to our Allpointe benefits support team.

I can use this same counting method to determine whether our plan or Medicare is primary...right?

Yeah, about that...close, but not exactly. Stay tuned...

Still struggling with paper enrollment forms? Let's automate.

Some small employers are still struggling with spreadsheets, paper and .pdfs for their employee benefits. But why? Check out our Ease benefits portal, customized for your small business and your team:




Our experienced team will customize a benefits portal that builds your plan details, rates, eligibility rules and change requirements into simplified workflows, that can work alongside any payroll system or software. Full 360 and 180 integrations are also available with popular payroll platforms, such as Paylocity, ADP, Heartland, and more.

Contact Allpointe today to learn more about bringing your benefits and onboarding processes securely into the cloud.

Preparing to travel outside of Kaiser's service area?

Maybe you are headed for a 6-week dream vacation on another continent (lucky you). Meeting friends for a spur of the moment trip to Manhattan? Or dreading tomorrow's 7-hour drive to spend Thanksgiving with your in-laws in Arizona. Wherever your travels are taking you, at some point you pause and ask yourself,

"Does Kaiser cover me if something happens while I'm away from home?"

Then you realize you aren't 100% sure. You think so, but don't know exactly who to call or how to access services. Sound familiar?

Glad you asked.

Yes, you are covered for emergency and urgent care anywhere in world.

And if you happen to be traveling to another part of the U.S. where Kaiser is located, such as the Pacific Northwest, Hawaii, mid-Atlantic states, or Colorado, you can also access more routine services. Check out Kaiser's Care While Traveling page for the Away from Home Travel Line number, links to the secure messaging app, and more useful information.

Always refer to your plan's Evidence of Coverage and related documents for details of your specific coverage.

big pile of papers

You can now pay your Covered CA small business invoice online

Will we get enrollment and eligibility management next?

When Covered California launched its small business coverage in 2014, a tantalizing promise was unprecedented online account management for small businesses. Applications, enrollment management, online bill payment -- all would have leapfrogged the traditional carrier competitors in the small group market.

It took just a month for CCSB to admit they weren't ready.

Fast forward to 2019, and the traditional carriers all offer online account management, benefits enrollment, and online / automatic bill payment for small business health benefit plans. This week, CCSB finally announced the availability of online bill payments. Have you tried it? Let us know in the comments how well it works.

Blue Shield Contract with Stanford Hospital Expires; Negotiations Continue

Update 6/4/2018:

Good news from earlier today...Blue Shield just announced they have signed a new, multiyear contract with Stanford Health. From Blue Shield: "This means that Stanford Medical Center and its physicians are again part of Blue Shield's statewide network with no lapse as an in-network provider for contracted networks."


Blue Shield of California and Stanford Health Hospital have been unable to come to agreement on a new contract. Effective May 1, 2018 (July 1, 2018 for some HMO members), Stanford Health will be considered an out of network provider for commercial Blue Shield HMO and PPO plans. Members who are actively being treated or have treatment scheduled within 180 days can request an exception under Continuity of Care guidelines (full details below). Lucille Packard Children's Hospital and Palo Alto Medical Foundation are unaffected.

Blue Shield members who have accessed affected providers within the last 12 months will be notified directly by Blue Shield via U.S. Mail.

Note: While not guaranteed, based on past contract negotiations, it seems likely that the contract status will be resolved, though that process may take weeks or months rather than days. In the meantime, our clients: you, your employees and their families  are unfortunately caught in the middle of two behemoth health organizations in a fiscal fight.

This issue is not specific to Blue Shield, nor to Stanford Health. It is a function of the current U.S. health insurance structure, and its inherent lack of transparency. Contract negotiations and terms are not public (until they end/fail and the insurance carrier is required to notify affected members).

Our Allpointe team is available to answer your questions, your team's questions, and to assist any affected individual in obtaining continued care, or assessing their options, until this is resolved.

Full text of Blue Shield's announcement is below.

Email header title
Stanford Health hospital contract terminates while negotiations continue

Blue Shield of California and Stanford Health (Stanford) are engaged in discussions to renegotiate the terms of Stanford's hospital agreement (HMO/PPO) for Stanford Medical Center/Stanford Healthcare-University Healthcare Alliance PPO professional services, Valleycare Medical Center, and Valley Memorial Hospital (LTC) serving Alameda and Santa Clara counties. Since we have not reached a new agreement, our contract for Stanford Medical Center/Stanford Healthcare-University Healthcare Alliance PPO professional services has expired, effective April 30, 2018, at 11:59 p.m. The contracts for Valleycare Medical Center, and Valley Memorial Hospital (LTC) remain in effect through May 31, 2018. Lucile Salter Packard Children's Hospital is not part of this contract termination. Members who have used Stanford Medical Center/Stanford Healthcare-University Healthcare Alliance PPO professional services in the last 12-month period will receive notification of this termination on May 4, 2018, providing them with alternate network facilities and advising of our continuation of covered services options.

Affinity Medical Group (now part of Stanford Health) is also part of the contract negotiation. Though the current contract for Affinity Medical Group remains in effect until June 30, 2018, the Department of Managed Health Care (DMHC) regulations require Blue Shield to notify HMO members of a change to their medical group and if applicable, primary care physician (PCP), 60 days in advance of a potential termination. Therefore, because we have not reached an agreement with Stanford Health, letters were mailed to HMO members assigned to Affinity Medical Group on May 1, 2018. If we reach an agreement later, members will be notified and may request to be assigned back to the Affinity Medical Group and their Affinity PCP.

Who is affected?
Our Stanford Medical Center/Stanford Healthcare-University Healthcare Alliance PPO professional services and Affinity Medical Group contract affects Small Business, Core, Premier, and CalPERS market segments. Medicare members are not affected.

How does a contract termination with Stanford Medical Center/Stanford Healthcare-University Healthcare Alliance PPO professional services affect our members?

Commercial HMO/POS members
Since our commercial HMO agreements with Affinity Medical Group is scheduled to expire on June 30, 2017, and we have not reached a new agreement, Blue Shield commercial HMO members accessing Stanford Health will need to know the following:

  • Blue Shield sent notifications to commercial HMO/POS members assigned to PCPs with Affinity on May 1, 2018, to advise them that they will be reassigned to an alternate medical group for a July 1, 2018 effective date. Members can call the Member Services number on the back of their Blue Shield member ID card to select a different PCP other than the one assigned to them.
  • Blue Shield members assigned to an Affinity PCP who are receiving care from an Affinity physician on July 1, 2018, or who have a procedure scheduled to be performed by Stanford within 180 days of July 1, 2018, can request continuity of care through Blue Shield for ongoing treatment with their provider. These members can call the Blue Shield Member Services number on their Blue Shield ID card.

Stanford is generally used as a high-level, tertiary, and quaternary care facility.

Palo Alto Medical Foundation (PAMF) is not affected
PAMF uses Stanford as a primary admitting facility. PAMF (all pods) enrollees are not affected by this contract termination because our PAMF enrollment will continue accessing Stanford hospitals as a network facility. A contract termination will not affect Blue Shield members assigned to PAMF.

Please use this link to see the affected facilities and medical group as well as our complete listing of alternate providers.

Continuity of Care

HMO members
HMO members who are currently in a course of treatment or who have a procedure scheduled at a Stanford Medical Center/Stanford Healthcare-University Healthcare Alliance PPO professional services within 180 days of May 1, 2018, can request continuity of care by calling the Member Services number on the back of their Blue Shield ID card. We will work closely with the IPAs to facilitate these requests. If eligible for continuity of care, applicable network copays will apply.

PPO members
PPO members who are currently receiving or who have a procedure scheduled at a Stanford Medical Center/Stanford Healthcare-University Healthcare Alliance PPO professional services within 180 days of May 1, 2018, can request continuity of care for an ongoing course of treatment, and if eligible, receive the higher, preferred benefit level. These members can call the Blue Shield customer service telephone number on their Blue Shield ID card. They may also access Blue Shield's Continuity of Care online.

  • PPO members may continue to seek professional and/or hospital services from Stanford Medical Center and professional providers after the contract termination date. However, reimbursement for any such services, other than emergency services, will be reimbursed at the lower "Non-Preferred Provider" benefit level. Members will be responsible for all additional charges, up to the professionals' and hospitals' usual billed charges.
  • PPO members who wish to have their provider care and visits covered at the higher, preferred benefit level must receive care from a Blue Shield contracted provider. These members can call the Blue Shield customer service telephone number on their Blue Shield ID card or go online to Blue Shield's Find a Doctorpage.

POS members
Blue Shield's Point of Service (POS) plans combine both HMO and PPO service delivery features. A POS member's network determination or eligibility for continuity of care would be governed according to either the HMO or PPO definitions above, depending on which network the member is accessing.

Medicare members
Medicare members are not affected by this contract termination.

Emergency services
Blue Shield members who need emergency services should call 911 or seek care at the nearest emergency room, including Stanford. Blue Shield will provide the full emergency care level of benefits for these services.

We encourage members to make informed decisions about when to use urgent care as opposed to emergency room care. Urgent care is appropriate when a member needs a physician's attention for a condition that is non-life threatening. Any member needing urgent care but whose physician or network provider is unavailable should go to the nearest immediate or urgent care facility. Members can access a list of nearby urgent care facilities online at Find a Doctor.

Our commitment to affordably priced health coverage
We appreciate your patience as we work to secure the best possible outcome for our members. Blue Shield negotiates in good faith, and we remain focused on our mission of providing Californians access to quality health care at an affordable price.


  • Letters to commercial HMO/POS members assigned to an Affinity Medical Group or PCP were sent on May 1, 2018.
  • An employer notification will be sent via email to employers with affected members on May 3, 2018.
  • Letters to members who have used Stanford Medical Center/Stanford Healthcare-University Healthcare Alliance PPO professional services in the most recent 12-month period will be sent within five days of termination, or no later than May 4, 2018.
  • Members who have used Valleycare Medical Center or Valley Memorial Hospital in the most recent 12-month period will be sent within five days of termination or no later than June 5, 2018.

To review the regulated member letter sent to those with an Affinity PCP, or to access the regulated member letter send to those who have used Stanford Medical Center/Stanford Healthcare-University Healthcare Alliance PPO professional services, please use the appropriate links.

Weed is legal. Disclose your use on a life insurance application?

We typically write 20-30 term life policies annually for business owners and other high-net worth individuals, often as part of a buy-sell agreement or key person policy for our small business clients. Our general agency partner gives us access to a medical underwriting director with 25 years of experience, enabling us to match the right carrier with our client-specific needs and health/family history.

One new wrinkle is the legalization of recreational marijuana in California in 2018. How does a life insurance company looks at marijuana use? Here are a few examples from our medical underwriter:

Ex 1: 39 year old male, admits to smoking an occasional marijuana cigarette once a month.  Urine specimen is negative for THC.  All other underwriting criteria are standard or better.  Case will likely be STANDARD (or better).

Ex 2: 28 year old male, does NOT admit to marijuana use on his application or insurance exam.  Urine specimen is positive for THC.  All other underwriting criteria are standard or better. Case will likely be RATED or DECLINED.

Ex 3: 54 year old male, history of chronic back pain controlled with medical marijuana obtained by prescription.  No physical limitations and employed full time.  No disability or extended time off from work.  No other underwriting concerns.  Case could be STANDARD or RATED.

(putting some jargon into understandable terms):

"Standard" = not great (3rd or 4th best risk class) = more expensive.

"Rated" = a LOT more expensive.

"Declined" = might get Standard or Rated sometime in the future, (but maybe not).

If you are thinking about taking advantage of one of California's new "green businesses," you may want to consider first locking in a 20- or 30-year term life policy. Once in place, you will then be truly free to choose whether to use.