Psychologists struggle to access small business loans

Whether now, or as part of a possible future program, psychologists who hope to get federal relief for business woes caused by the coronavirus pandemic will need to be quick and smart about applying, and patient once the paperwork has been submitted.

"Get that application in as soon as possible," says Alex Assaleyopens in new window, a Washington, D.C.-based financial adviser. "Make sure you've got all the documents you need, and then just do it."

Created under the CARES Actopens in new window in March 2020, originally funded with $349 billion, the first phase of the loan program for small businesses ran out of moneyopens in new window within two weeks. Congress funded a second round of loans with $310 billion in new funds, and banks began accepting applications on April 27. The website of the U.S. Small Business Administrationopens in new window crashed repeatedly from heavy useopens in new window all that day.

Meanwhile, business leaders, including Bank of America CEO Bryan Moynihan and U.S. Chamber of Commerce Executive Vice President Neil Bradleyopens in new window, called on Congress to keep the money coming.

“We need to take away the first-come, first-served aspects of this and make sure it's fully funded, because at the end of the day, it's going to where people want it: small businesses, 25% in our case to businesses in low and moderate income neighborhoods, businesses with small numbers of employees. We just need to finish the funding and finish the work,” Moynahan saidopens in new window on CBS's "Face the Nation" on April 26.

Some APA members who applied for loans during the original application period saw their paperwork get stuck in the pipeline. Assaley says that people who applied through smaller banks seemed to have a smoother experience and more success. He advises anyone hoping to receive funds in response to an application filed under the initial program to contact the bank to make sure the application is still active.

"I'd call and call and call" if necessary to receive that affirmation, Assaley says.

As of this week, three psychologists with very different types of businesses, who applied as soon as they could for loans during the first phase, were still waiting for a resolution. Like many other small business owners, they were frustrated by the confused initial rollout, at the end of which publicly funded companies and favored bank clients, especially in rural areas not hit as hard as cities, emerged with the lion's shareopens in new window of the money.

Kevin Arnold PhD, ABPP, is president of the Center for Cognitive and Behavioral Therapy (CCBT)opens in new window in Columbus, Ohio , a group practice with five offices, more than 35 providers and a support staff of nine people. CCBT applied for a loan under the Paycheck Protection Program (PPP), designed to shore up small businesses' and sole proprietors' payrolls and pay for some types of overhead, and an Economic Injury Disaster Loan (EIDL), an advance of up to $10,000 to compensate for a temporary loss of revenue.

Arnold, who is board certified in behavioral and cognitive psychology, is proud of his firm's general foresight and business acumen. When COVID-19 threatened to become a pandemic, his team purchased seats on a HIPAA-compliant telehealth platform and offered training for its therapists. So when Ohio Governor Mike DeWine issued a stay-at-home order on March 22, CCBT was largely ready. The problem was that its patients were not.

For about two-and-a-half weeks, the practice scrambled to transfer patients to telehealth. Some were distracted by all the changes in their own lives. Others did not have full digital access or the ability to use it, and approval came only in "dribs and drabs" from carriers and Medicare and Medicaid for emergency use of "the straight telephone," FaceTime and other tools that did not offer a Business Associatesopens in new window Agreement. The confusion didn't last long, but while it did, a large amount of income was not generated, Arnold says. CCBT furloughed two administrative staffers during that time.

Arnold applied for the loans through PNCopens in new window, where CCBT has had an account for many years. PNC's program lagged the April 3 opening date a bit. In the meantime, by the third week in April, CCBT received $10,000 in EIDL funds. Arnold says he reached out to PNC several times, and was informed that the staff there was working nonstop. On the evening of April 14, PNC requested additional documents not requested in the original application portal, and Arnold supplied them before midnight. He discovered on April 15, 2020, from PNC's online system that his application had been forwarded to the SBA. If CCBT gets that PPP loan, Arnold says he won't need the EIDL.

Stephen Bloomfield, PhDopens in new window, a Jacksonville, Florida, forensic psychologist and owner of Bloomfield Psychological Services, says he ordinarily spends about fourth-fifths of his time consulting with people in jail or prisons — inmates convicted as juveniles, for example, who are now requesting re-hearings, and around substance abuse issues, adoption and trauma. His firm has the equivalent of four full-time employees.

Bloomfield tried telehealth toward the beginning of the pandemic, but concluded it wasn't a viable way to securely interview incarcerated clients. He hasn't visited a jail or prison since March 13. With more than 4,000 inmates and staff members quarantined in the Florida correctionalopens in new window system, and more than 300 confirmed COVID-19 cases in its facilities by the end of April, "it's not safe to go to those places," he says.

With his work stalled, Bloomfield applied for a PPP loan from Bank of America,opens in new window his longtime business bank, first on April 3. The bank came back twice in the next several days seeking different information. Bloomfield's application was approved, but he hasn't received any money. He says he is on five Listservs for psychologists, and has seen only one person attest to having received money.

"They never gave us a place at the table," Bloomfield says of his take on the federal government's intentions toward small businesses like his, and sole proprietors. In the first round, "by the time we got approved, the money was gone. We followed the rules, and we haven't seen a penny."

Bernardo Ferdman, PhDopens in new window, a San Diego, California-based organizational psychologist and consultant on diversity and inclusion, applied April 3 through Bank of America for EIDL and PPP loans. Ferdman, a sole proprietor, also found himself enmeshed in a changing and challenging application process. His PPP loan has been submitted to the SBA, but he hasn't heard about the EIDL loan.

Ferdman, who does coaching and strategic work with businesses, helps organizations develop inclusion plans and supports leaders in implementing them. Late this winter, he watched as the conferences where he both speaks and networks were canceled one by one, or postponed, including an APA gathering at the end of March. At the same time, the businesses he consults with went on lockdown. His work, all virtual now, has scaled way back, and he says he can only hope that inclusion will still be a priority for businesses when the crisis is over.

"There's a lot of uncertainty," Ferdman says.

He notices that some fellow psychologists seem reluctant to ask for the kind of financial help the loan program offers. He thinks such qualms are misguided.

"If that's the question, 'What's ethical, what's correct, when do you need it, when do you not?' then we're not thinking of ourselves as business people," he says. "I know I'm at risk. I should put myself in line with everybody else."