Rural America Health Care Improvement Act

Summary: TABLE OF CONTENTS: 
     Title I:  Provisions Relating to Public Health Service Act 
     Title II:  Provisions Relating to Medicare 
     Title III:  Tax Incentives for Health Services Providers 
Rural America Health Care Improvement Act - 
Title I:  Provisions Relating to Public Health Service Act
 - Amends the Public Health Service Act to authorize appropriations for FY 1996 through FY 1998. Requires allocations from such amounts in order to ensure that 20 percent of the participants in the Scholarship and Loan Repayment Program are being educated as specified nonphysician health professionals. 
Authorizes the Secretary to make grants to public and nonprofit private entities for carrying out projects to develop health plans to provide services exclusively in rural and frontier areas.  Sets forth requirements for those requesting grant assistance.  Authorizes appropriations. 
Authorizes the Secretary of Health and Human Services to make grants to public and nonprofit private hospitals in medically underserved rural communities for the purpose of carrying out projects to develop or increase the capacity of the hospitals and facilities to provide primary health services.  Authorizes appropriations. 
Authorizes appropriations for training of rural health professionals other than physicians. 
Title II:  Provisions Relating to Medicare
 - Amends title XVIII (Medicare) of the Social Security Act to increase the amount of payment to primary care service providers in underserved areas. 
Title III:  Tax Incentives for Health Services Providers
 - Amends the Internal Revenue Code to allow a tax credit for certain primary health services providers in health professional shortage areas who have not received a National Health Service Corps scholarship or loan.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Rural America Health Care 
Improvement Act''.

       TITLE I--PROVISIONS RELATING TO PUBLIC HEALTH SERVICE ACT

SEC. 101. ADMINISTRATOR OF PROGRAMS; FUNDING.

    (a) Administrator.--For purposes of this title, the term 
``Secretary'' means the Secretary of Health and Human Services.
    (b) Funding.--The authorizations of appropriations established in 
this title are in addition to any other authorizations of 
appropriations that are available for the purposes of this title.

SEC. 102. NATIONAL HEALTH SERVICE CORPS.

    (a) Additional Funding; General Corps Program; Allocation for 
Certain Nonphysician Health Professionals.--For the purpose of carrying 
out subpart II of part D of title III of the Public Health Service Act, 
and for the purpose of carrying out subsection (b), there are 
authorized to be appropriated $50,000,000 for fiscal year 1996, 
$100,000,000 for fiscal year 1997, and $200,000,000 for fiscal year 
1998.
    (b) Allocation for Participation of Certain Nonphysician Health 
Professionals in Scholarship and Loan Repayment Programs.--
            (1) In general.--Of the amounts appropriated under this 
        section, the Secretary shall reserve such amounts as may be 
        necessary to ensure that, of the number of individuals who are 
        participants in the Scholarship Program under section 338A of 
        the Public Health Service Act, or in the Loan Repayment Program 
        under section 338B of such Act, the total number who are being 
        educated as health professionals specified in paragraph (2), or 
        are serving as such professionals, respectively, is increased 
        to 20 percent.
            (2) Relevant professions.--The health professionals 
        referred to in paragraph (1) are nurse practitioners, certified 
        nurse midwives, and registered nurses, and physician 
        assistants.

SEC. 103. DEVELOPMENT OF COMMUNITY-OPERATED HEALTH PLANS IN RURAL AND 
              FRONTIER AREAS.

    (a) Community-Operated Health Plans.--
            (1) In general.--The Secretary may make grants to public 
        and nonprofit private entities for the purpose of carrying out 
        projects to develop health plans to provide services 
        exclusively in rural and frontier areas.
            (2) Requirements for health plans.--For purposes of this 
        section, the term ``health plan'' means a community-rated plan 
        or an experience-rated plan.
    (b) Community Involvement.--The Secretary may make a grant under 
subsection (a) only if the applicant involved meets the following 
conditions:
            (1) In developing the proposal of the applicant for a 
        project under such subsection, the applicant has consulted with 
        the local governments of the geographic area to be served by 
        the health plan developed through the project, with individuals 
        who reside in the area, and with a reasonable number and 
        variety of health professionals who provide services in the 
        area.
            (2) The applicant agrees that the principal legal authority 
        over the operation of the health plan will be vested in 
        individuals who reside in such geographic area.
            (3) In the proposal the applicant specifies how a full 
        continuum of services will be provided.
            (4) In the proposal the applicant specifies how the 
        proposed health plan will utilize existing health care 
        facilities in a manner that avoids unnecessary duplication.
    (c) Use of Funds.--
            (1) In general.--Funds made available under this section 
        may be used for the following:
                    (A) To develop integrated health networks, 
                utilizing existing local providers and facilities where 
                appropriate, with community involvement.
                    (B) For information systems, including 
                telecommunications.
                    (C) For transportation services.
            (2) Limitations.--Funds made available under this section 
        shall not be used for the following:
                    (A) For a telecommunications system, unless the 
                system is coordinated with, and does not duplicate, 
                such a system existing in the area.
                    (B) For paying off existing debt.
    (d) Funding.--For the purpose of carrying out this section, there 
are authorized to be appropriated $50,000,000 for fiscal year 1996, 
$50,000,000 for fiscal year 1997, and $50,000,000 for fiscal year 1998.
SEC. 104. PRIMARY HEALTH CARE FOR MEDICALLY UNDERSERVED RURAL 
              COMMUNITIES; INCREASED CAPACITY OF HOSPITALS AND 
              OUTPATIENT FACILITIES.

    (a) In General.--The Secretary may make grants to public and 
nonprofit private hospitals in medically underserved rural communities, 
and to public and nonprofit private outpatient facilities in such 
communities, for the purpose of carrying out projects to develop or 
increase the capacity of the hospitals and facilities to provide 
primary health services.
    (b) Medically Underserved Rural Community.--For purposes of this 
section, the term ``medically underserved rural community'' means--
            (1) a rural area that has a substantial number of 
        individuals who are members of a medically underserved 
        population, as defined in section 330 of the Public Health 
        Service Act; or
            (2) a rural area a significant portion of which is a health 
        professional shortage area designated under section 332 of such 
        Act.
    (c) Certain Expenditures.--
            (1) In general.--The purposes for which the Secretary may 
        authorize a grant under subsection (a) to be expended include 
        the renovation of facilities, the purchase of equipment, and 
        the recruitment and retention of personnel.
            (2) Certain facilities.--The purposes for which the 
        Secretary may authorize a grant under subsection (a) to be 
        expended include--
                    (A) the development of rural emergency medical care 
                hospitals; and
                    (B) the development of nurse-managaged health 
                centers for the provision of primary health care 
                services in rural areas and for coordinating with 
                health care providers and networks.
    (d) Definitions.--
            (1) Rural emergency medical care hospitals.--For purposes 
        of this section, a rural emergency medical care hospital is a 
        facility with the following characteristics:
                    (A) It is a hospital that is in danger of closing 
                due to low inpatient utilization rates and operating 
                losses.
                    (B) The closure of the facility would limit the 
                access of individuals residing in the facility's 
                service area to emergency services.
                    (C) The facility has entered into (or intends to 
                enter into) an agreement with another hospital that 
                will accept the transfer of patients.
                    (D) A physician is available on-call to provide 
                emergency medical services on a 24-hour-a-day basis.
                    (E) The facility must have a practitioner who is 
                qualified to provide advanced cardiac life support 
                services (as determined by the State in which the 
                facility is located) on-site at the facility on a 24-
                hour-a-day basis.
                    (F) The facility meets such staffing requirements 
                as would apply under section 1861(e) of the Social 
                Security Act, except that the facility need not meet 
                hospital standards relating to the number of hours 
                during a day, or days during a week, in which the 
                facility must be open, but must provide emergency care 
                on a 24-hour-a-day basis.
            (2) Nurse-managed health centers.--For purposes of this 
        section, the term ``nurse-managed health center'' means a 
        health center meeting the following conditions (to the extent 
        in accordance with applicable law): The services of the center 
        are primary health services; the principal providers of such 
        services through the center are nurse practitioners, certified 
        nurse midwives, and clinical nurse specialists; the principal 
        managers of the center are professional nurses; and the 
        procedures of the center provide patients with direct access to 
        nurse practitioners, certified nurse midwives, or clinical 
        nurse specialists.
    (e) Funding.--
            (1) Hospitals.--For the purpose of making grants to 
        hospitals under subsection (a), there are authorized to be 
        appropriated $50,000,000 for fiscal year 1996, $50,000,000 for 
        fiscal year 1997, and $50,000,000 for fiscal year 1998.
            (2) Outpatient facilities.--For the purpose of making 
        grants to outpatient facilities under subsection (a), there are 
        authorized to be appropriated $50,000,000 for fiscal year 1996, 
        $50,000,000 for fiscal year 1997, and $50,000,000 for fiscal 
        year 1998.

SEC. 105. TRAINING OF RURAL HEALTH PROFESSIONALS OTHER THAN PHYSICIANS.

    (a) Funding for Programs Under Public Health Service Act.--With 
respect to programs of title VII or VIII of the Public Health Service 
Act that provide for the training of individuals as health 
professionals other than physicians, there are authorized to be 
appropriated for the purpose of carrying out such programs, through 
entities described in subsection (b), $50,000,000 for each of the 
fiscal years 1996 through 1998.
    (b) Eligibility.--With respect to a program referred to in 
subsection (a), an entity described in this subsection is an entity--
            (1) that is eligible to receive grants or contracts under 
        the program (as provided in the applicable provisions of title 
        VII or VIII of the Public Health Service Act); and
            (2) a substantial number of whose designated graduates are 
        providing health services in a rural area.
    (c) Definition of Designated Graduate.--For purposes of this 
section, the term ``designated graduate'', with respect to an entity, 
means an individual completing the training involved during the 5-year 
period preceding the fiscal year for which the entity is applying to 
receive a grant or contract under the applicable program referred to in 
subsection (a).
    (d) Certain Programs.--Programs carried out under subsection (a) 
shall include programs for nurse practitioners, physician assistants, 
and nurse midwives.
               TITLE II--PROVISIONS RELATING TO MEDICARE

SEC. 201. MEDICARE INCENTIVES FOR PHYSICIANS TO PROVIDE PRIMARY CARE.

    (a) Underserved Area Bonus Payments; Increase in Amount of Payment 
for Primary Care Services.--Section 1833(m) of the Social Security Act 
(42 U.S.C. 1395l(m)) is amended--
            (1) by striking ``10 percent'' and inserting ``a percent'',
            (2) by striking ``service'' the last place it appears and 
        inserting ``services'', and
            (3) by adding the following new sentence: ``The percent 
        referred to in the previous sentence is 20 percent in the case 
        of primary care services, as defined in section 1842(i)(4), and 
        10 percent for services other than primary care services 
        furnished in health professional shortage areas located in 
        rural areas as defined in section 1886(d)(2)(D).''.
    (b) Effective Date.--The amendments made by subsection (a) are 
effective for services furnished on or after January 1, 1996.

        TITLE III--TAX INCENTIVES FOR HEALTH SERVICES PROVIDERS

SEC. 301. NONREFUNDABLE CREDIT FOR CERTAIN PRIMARY HEALTH SERVICES 
              PROVIDERS.

    (a) In General.--Subpart A of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 (relating to nonrefundable 
personal credits) is amended by inserting after section 22 the 
following new section:

``SEC. 23. PRIMARY HEALTH SERVICES PROVIDERS.

    ``(a) Allowance of Credit.--There shall be allowed as a credit 
against the tax imposed by this chapter for the taxable year an amount 
equal to the product of--
            ``(1) the number of months during such taxable year--
                    ``(A) during which the taxpayer is a qualified 
                primary health services provider, and
                    ``(B) which are within the taxpayer's mandatory 
                service period, and
            ``(2) $1,000 ($500 in the case of a qualified practitioner 
        who is not a physician).
    ``(b) Qualified Primary Health Services Provider.--For purposes of 
this section, the term `qualified primary health services provider' 
means, with respect to any month, any qualified practitioner who--
            ``(1) has in effect a certification by the Bureau as a 
        provider of primary health services and such certification is, 
        when issued, for a health professional shortage area in which 
        the qualified practitioner is commencing the providing of 
        primary health services,
            ``(2) is providing primary health services full time in the 
        health professional shortage area identified in such 
        certification, and
            ``(3) has not received a scholarship under the National 
        Health Service Corps Scholarship Program or any loan repayments 
        under the National Health Service Corps Loan Repayment Program.
For purposes of paragraph (2), a provider shall be treated as providing 
services in a health professional shortage area when such area ceases 
to be such an area if it was such an area when the provider commenced 
providing services in the area.
    ``(c) Mandatory Service Period.--For purposes of this section, the 
term `mandatory service period' means the period of 60 consecutive 
calendar months beginning with the first month the taxpayer is a 
qualified primary health services provider. A taxpayer shall not have 
more than 1 mandatory service period.
    ``(d) Definitions and Special Rules.--For purposes of this 
section--
            ``(1) Bureau.--The term `Bureau' means the Bureau of 
        Primary Health Care, Health Resources and Services 
        Administration of the United States Public Health Service.
            ``(2) Qualified practitioner.--The term `qualified 
        practitioner' means a physician, a physician assistant, a nurse 
        practitioner, or a certified nurse-midwife.
            ``(3) Physician.--The term `physician' has the meaning 
        given to such term by section 1861(r) of the Social Security 
        Act.
            ``(4) Physician assistant; nurse practitioner.--The terms 
        `physician assistant' and `nurse practitioner' have the 
        meanings given to such terms by section 1861(aa)(5) of the 
        Social Security Act.
            ``(5) Certified nurse-midwife.--The term `certified nurse-
        midwife' has the meaning given to such term by section 
        1861(gg)(2) of the Social Security Act.
            ``(6) Primary health services.--The term `primary health 
        services' has the meaning given such term by section 330(b)(1) 
        of the Public Health Service Act.
            ``(7) Health professional shortage area.--The term `health 
        professional shortage area' has the meaning given such term by 
        section 332(a)(1)(A) of the Public Health Service Act.
    ``(e) Recapture of Credit.--
            ``(1) In general.--If there is a recapture event during any 
        taxable year, then--
                    ``(A) no credit shall be allowed under subsection 
                (a) for such taxable year and any succeeding taxable 
                year, and
                    ``(B) the tax of the taxpayer under this chapter 
                for such taxable year shall be increased by an amount 
                equal to the product of--
                            ``(i) the applicable percentage, and
                            ``(ii) the aggregate unrecaptured credits 
                        allowed to such taxpayer under this section for 
                        all prior taxable years.
            ``(2) Applicable recapture percentage.--
                    ``(A) In general.--For purposes of this subsection, 
                the applicable recapture percentage shall be determined 
                from the following table:

                    ``If the recapture
                                                  The applicable recap-
                      event occurs during:
                                                    ture percentage is:
                            Months 1-24..............           100    
                            Months 25-36.............            75    
                            Months 37-48.............            50    
                            Months 49-60.............            25    
                            Months 61 and thereafter.            0.    
                    ``(B) Timing.--For purposes of subparagraph (A), 
                month 1 shall begin on the first day of the mandatory 
                service period.
            ``(3) Recapture event defined.--
                    ``(A) In general.--For purposes of this subsection, 
                the term `recapture event' means the failure of the 
                taxpayer to be a qualified primary health services 
                provider for any month during the taxpayer's mandatory 
                service period.
                    ``(B) Cessation of designation.--The cessation of 
                the designation of any area as a health professional 
                shortage area after the beginning of the mandatory 
                service period for any taxpayer shall not constitute a 
                recapture event.
                    ``(C) Secretarial waiver.--The Secretary, in 
                consultation with the Secretary of Health and Human 
                Services, may waive any recapture event caused by 
                extraordinary circumstances.
            ``(4) No credits against tax; minimum tax.--Any increase in 
        tax under this subsection shall not be treated as a tax imposed 
        by this chapter for purposes of determining the amount of any 
        credit under subpart A, B, or D of this part or for purposes of 
        section 55.''
    (b) Clerical Amendment.--The table of sections for subpart A of 
part IV of subchapter A of chapter 1 of such Code is amended by 
inserting after the item relating to section 22 the following new item:

                              ``Sec. 23. Primary health services 
                                        providers.''
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 1995.