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CARES Act: Impact on Medical Residents and Fellows

The $2.3 trillion Coronavirus Aid, Relief, and Economic Security (CARES) Act (P.L. 116-136) became law on March 27, 2020. This expansive stimulus package includes loans and support to major industries and direct payments to individuals and families. Considerable CARES Act provisions include:

  • Direct payments to individuals of $1,200 per adult with an additional $500 per child
  •  Over $100 billion in hospital investments
  •  Increases reimbursements by 20% for treating Medicare patients with coronavirus
  •  $350 billion in loans for small businesses
  • Unemployment benefits increased $600/week for four months
  • $150 billion for state and local funds, including $8 billion for tribal governments

CARES Act Provisions of Interest to Medical Residents and Fellows


Temporary Relief for Federal Student Loan Borrowers: Requires the U.S. Department of Education (ED) Secretary to defer student loan payments, principal, and interest through September 30, 2020, without penalty to the borrower for all federally owned loans

Public Service Loan Forgiveness (PSLF) Credit: Borrowers receive full PSLF credit during the suspension period if they:

  • Have a Direct Loan
  • Were on a qualifying repayment plan prior to March 13, 2020
  • AND work full-time for a qualifying employer between March 13, 2020, and September 30, 2020

0% Interest Period: From March 13, 2020, through September 30, 2020, the interest rate is 0% on the following types of federal student loans owned by ED:

  • Defaulted and nondefaulted Direct Loans
  • Defaulted and nondefaulted FFEL Program loans
  • Federal Perkins Loans

Borrowers are still able to make full or partial payments towards their borrowed amount if they so choose.

For additional information, please review ED’s Office of Federal Student Aid FAQs for federal student loan borrowers. This information is routinely updated.


Hospital Funding: Provides $100 billion to ensure health care providers receive support for COVID-19 related expenses and lost revenue, and at least $250 million for hospital preparedness

Strategic National Stockpile: $16 billion to the Strategic National Stockpile to procure personal protective equipment, ventilators, and other medical supplies for federal and state response efforts

Rural Health: Grants the Health Resources and Services Administration (HRSA) $275 million to expand services for rural hospitals (among other priorities), reauthorizes HRSA grant programs to strengthen rural community health, and allows for Medicare reimbursement for telehealth services at Federally Qualified Health Centers and Rural Health Clinics. As part of this funding, HRSA recently awarded nearly $165 million to combat the COVID-19 pandemic in rural communities.

Community Health: Grants $1.32 billion in supplemental funding to community health centers (CHCs) on the front lines of testing and treating patients


U.S. Public Health Service Modernization: Establishes a Ready Reserve Corp to ensure there are enough trained doctors and nurses to respond to COVID-19 and other public health emergencies

Limits Liability for Volunteer Health Care Professionals during COVID-19 emergency response. View the Centers for Medicare and Medicaid Services’ waivers and guidance.

Flexibility for National Health Service Corps (NHSC) Members: Allows the U.S. Department of Health and Human Services Secretary to reassign NHSC members to a closer site than the one to which they were originally assigned to respond to COVID-19. View NHSC FAQs on COVID-19.

Professional Program Funding: Extends funding for CHCs, the NHSC, and the Teaching Health Center Graduate Medical Education Program at current levels through November 30, 2020

Geriatrics Training: Reauthorizes and updates Title VII of the Public Health Service Act, which pertains to programs to support clinician training and faculty development, including the training of practitioners in family medicine, general internal medicine, geriatrics, pediatrics, and other medical specialties

Emergency Paid Sick Leave Limitation: Limits the amount an employer is required to pay for sick leave to $511 per day ($5,110 in aggregate) or $200 per day ($2,000 in aggregate) to care for a quarantined individual or child

Additional Resources and Contact Information

For information about how the CARES Act affects osteopathic medical education (OME) more broadly, please review AACOM’s analysis of the stimulus package on how the law impacts OME.

Paycheck Protection Program and Health Care Enhancement Act

In a continued effort to combat the significant economic effects of the COVID-19 pandemic, the President last month signed into law the Paycheck Protection Program and Health Care Enhancement

Act (P.L. 116-139), a $483.4 billion relief package originally meant to be an “interim” fix to replenish a small-business loan program created in the CARES Act. Dubbed COVID 3.5, the latest package includes $321 billion for the depleted Paycheck Protection Program to aid small businesses suffering under the COVID-19 pandemic, $75 billion for hospitals and other medical providers to cover increased expenses and lost revenue, and $25 billion for federal, state, and local coronavirus testing. View AACOM’s analysis of COVID 3.5.

For questions, please contact aacomgr@aacom.org.