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Information frictions and access to the Paycheck Protection Program.

ABSTRACT: The Paycheck Protection Program (PPP) extended 669 billion dollars of forgivable loans in an unprecedented effort to support small businesses affected by the COVID-19 crisis. This paper provides evidence that information frictions and the "first-come, first-served" design of the PPP program skewed its resources towards larger firms and may have permanently reduced its effectiveness. Using new daily survey data on small businesses in the U.S., we show that the smallest businesses were less aware of the PPP and less likely to apply. If they did apply, the smallest businesses applied later, faced longer processing times, and were less likely to have their application approved. These frictions may have mattered, as businesses that received aid report fewer layoffs, higher employment, and improved expectations about the future.

SUBMITTER: Humphries JE

PROVIDER: S-EPMC7441872 | biostudies-literature | 2020 Oct

REPOSITORIES: biostudies-literature

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Information frictions and access to the Paycheck Protection Program.

Humphries John Eric JE Neilson Christopher A CA Ulyssea Gabriel G

Journal of public economics 20200821

The Paycheck Protection Program (PPP) extended 669 billion dollars of forgivable loans in an unprecedented effort to support small businesses affected by the COVID-19 crisis. This paper provides evidence that information frictions and the "first-come, first-served" design of the PPP program skewed its resources towards larger firms and may have permanently reduced its effectiveness. Using new daily survey data on small businesses in the U.S., we show that the smallest businesses were less aware ...[more]

PMID: 32863461

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Project description:ImportanceStaffing shortages in nursing homes (NHs) threaten the quality of resident care, and the COVID-19 pandemic magnified critical staffing shortages within NHs. During the pandemic, the US Congress enacted the Paycheck Protection Program (PPP), a forgivable loan program that required eligible recipients to appropriate 60% to 75% of the loan toward staffing to qualify for loan forgiveness.ObjectiveTo evaluate characteristics of PPP loan recipient NHs vs nonloan recipient NHs and whether there were changes in staffing hours at NHs that received a loan compared with those that did not.Design, setting, and participantsThis economic evaluation used national data on US nursing homes that were aggregated from the Small Business Administration, Nursing Home Compare, LTCFocus, the Centers for Medicare & Medicaid Services Payroll Based Journal, the Minimum Data Set, the Area Deprivation Index, the Healthcare Cost Report Information System, and the US Department of Agriculture Rural-Urban Continuum Codes from January 1 to December 23, 2020.ExposurePaycheck Protection Program loan receipt status.Main outcome and measuresStaffing variables included registered nurse, licensed practical nurse (LPN), and certified nursing assistant (CNA) total hours per week. Staffing hours were examined on a weekly basis before and after loan receipt during the study period. An event-study approach was used to estimate the staffing total weekly hours at NHs that received PPP loans compared with NHs that did not receive a PPP loan.ResultsAmong 6008 US NHs, 1807 (30.1%) received a PPP loan and 4201 (69.9%) did not. The median loan amount was $664 349 (IQR, $407 000-$1 058 300). Loan recipients were less likely to be part of a chain (733 [40.6%] vs 2592 [61.7%]) and more likely to be for profit (1342 [74.3%] vs 2877 [68.5%]), be located in nonurban settings (159 [8.8%] vs 183 [4.4%]), have a greater proportion of Medicaid-funded residents (mean [SD], 60.92% [21.58%] vs 56.78% [25.57%]), and have lower staffing quality ratings (mean [SD], 2.88 [1.20] vs 3.03 [1.22]) and overall quality star ratings (mean [SD], 3.08 [1.44] vs 3.22 [1.44]) (P < .001 for all). Twelve weeks after PPP loan receipt, NHs that received a PPP loan experienced a mean difference of 26.19 more CNA hours per week (95% CI, 14.50-37.87 hours per week) and a mean difference of 6.67 more LPN hours per week (95% CI, 1.21-12.12 hours per week) compared with nursing homes that did not receive a PPP loan. No associations were found between PPP loan receipt and weekly RN staffing hours (12 weeks: mean difference, 1.99 hours per week; 95% CI, -2.38 to 6.36 hours per week).Conclusions and relevanceIn this economic evaluation, a forgivable loan program that required funding to be appropriated toward staffing was associated with a significant increase in CNA and LPN staffing hours among NH PPP loan recipients. Because the PPP loans are temporary, federal and state entities may need to institute sufficient and sustainable support to mitigate NH staffing shortages.

Project description:BackgroundImprovement of coordination of all health and social care actors in the patient pathways is an important issue in many countries. Health Information (HI) technology has been considered as a potentially effective answer to this issue. The French Health Ministry first funded the development of five TSN ("Territoire de Soins Numérique"/Digital health territories) projects, aiming at improving healthcare coordination and access to information for healthcare providers, patients and the population, and at improving healthcare professionals work organization. The French Health Ministry then launched a call for grant to fund one research project consisting in evaluating the TSN projects implementation and impact and in developing a model for HI technology evaluation.MethodsEvaTSN is mainly based on a controlled before-after study design. Data collection covers three periods: before TSN program implementation, during early TSN program implementation and at late TSN program implementation, in the five TSN projects' territories and in five comparison territories. Three populations will be considered: "TSN-targeted people" (healthcare system users and people having characteristics targeted by the TSN projects), "TSN patient users" (people included in TSN experimentations or using particular services) and "TSN professional users" (healthcare professionals involved in TSN projects). Several samples will be made in each population depending on the objective, axis and stage of the study. Four types of data sources are considered: 1) extractions from the French National Heath Insurance Database (SNIIRAM) and the French Autonomy Personalized Allowance database, 2) Ad hoc surveys collecting information on knowledge of TSN projects, TSN program use, ease of use, satisfaction and understanding, TSN pathway experience and appropriateness of hospital admissions, 3) qualitative analyses using semi-directive interviews and focus groups and document analyses and 4) extractions of TSN implementation indicators from TSN program database.DiscussionEvaTSN is a challenging French national project for the production of evidenced-based information on HI technologies impact and on the context and conditions of their effectiveness and efficiency. We will be able to support health care management in order to implement HI technologies. We will also be able to produce an evaluation toolkit for HI technology evaluation.Trial registrationClinicalTrials.gov ID: NCT02837406 , 08/18/2016.

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Information frictions and access to the Paycheck Protection Program.

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Information frictions and access to the Paycheck Protection Program.

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