Written by: Susan L. Swatski, Esq.

The following is a brief summary of the CARES Act.

Health Care

  • Clarifies that all testing for coronavirus (COVID-19) is to be covered by private insurance plans without cost sharing. The Act covers all services provided during a medical visit, including an in-person or telehealth visit to a doctor’s office or an emergency room, that results in coronavirus screening. This coverage is in effect only while there is a declared public health emergency.
  • Changes the use of health savings accounts (HSAs) paired with high-deductible health plans (HDHPs) by allowing a HDHP with a HSA to cover telehealth services prior to a patient reaching the deductible.
  • Includes certain over-the-counter medical products, without a prescription, as “qualified expenses” under HSAs, Flexible Spending Accounts, Archer medical savings accounts and health reimbursement arrangements. This benefit applies to all amounts paid or expenses incurred after December 31, 2019.
  • Allows an employee who was laid off on or after April 1, 2020 to have access to paid family and medical leave in certain instances if they are rehired by the employer.
  • Allows employers to receive an advance tax credit from the Department of Treasury instead of having to be reimbursed on the back end. Creates regulatory authority to implement tax credit advancements.
  • Amends Section 518 of ERISA to provide the Department of Labor the ability to postpone certain ERISA filing deadlines for a period of up to one year in the case of a public health emergency.

Unemployment Insurance

  • Creates a new Pandemic Unemployment Assistance program (“PUA”) to help those not traditionally eligible for Unemployment Insurance (UI), including self-employed individuals, independent contractors, those with limited work history and those who are unable to work as a result of the coronavirus public health emergency. PUA is available through December 31, 2020. PUA pays 50% of the unemployment insurance costs incurred by state, local and tribal governments and non-profit organizations that would otherwise not be part of the UI system.
  • Provides additional $600/week payment to each UI or PUA recipient through the end of July 2020.
  • Provides funding for the 1st week of unemployment for states to waive the traditional “waiting week” before benefits begin.
  • Provides an additional 13 weeks of unemployment to help those who remain unemployed after weeks of state unemployment are no longer available.


Waives the 10% tax on early withdrawals up to $100,000 from a retirement plan or an IRA made on or after January 1, 2020 for an individual:

  • who is diagnosed with COVID-19;
  • whose spouse or dependent is diagnosed with COVID-19;
  • who experiences adverse financial consequences as a result of:
    • being quarantined,
    • furloughed,
    • laid off,
    • having work hours reduced,
    • being unable to work due to lack of child care due to COVID-19,
    • closing or reducing hours of a business owned or operated by the individual due to COVID-19; or
    • other factors as determined by the Treasury Secretary.
  • Permits individuals to pay tax on the income from the distribution over a three-year period and allows individuals to repay that amount tax-free back into the plan over the next three years.
  • Doubles the current retirement plan loan limits to the lesser of $100,000 or 100% of the participant’s vested account balance in the plan.
  • Individuals with an outstanding loan from their plan with a repayment due from the date of enactment of the CARES Act through Dec. 31, 2020, can delay their loan repayment(s) for up to one year.

For more information about this alert or if you have any questions or concerns, please contact Susan L. Swatski at (609)734-6318 or sswatski@hillwallack.com or any member of Hill Wallack’s Employment & Labor Law Department.