69–010 

Calendar No. 548 

110TH CONGRESS REPORT " ! SENATE 2d Session 110–274 

HEALTH CARE SAFETY NET ACT OF 2007 

MARCH 12, 2008.—Ordered to be printed 

Mr. KENNEDY, from the Committee on Health, Education, Labor, 

and Pensions, submitted the following 

R E P O R T 

[To accompany S. 901] 

The Committee on Health, Education, Labor, and Pensions, to 

which was referred the bill (S. 901) to amend the Public Health 

Service Act to provide additional authorizations of appropriations 

for the health centers program under section 330 of such Act, having considered the same, reports favorably thereon with an amendment in the nature of a substitute and an amendment to the title 

and recommends that the bill (as amended) do pass. 

CONTENTS 

Page 

I. Purpose and need for legislation .................................................................. 1 

II. Summary ........................................................................................................ 14 

III. History of legislation and votes in committee ............................................. 14 

IV. Explanation of bill and committee views ..................................................... 15 

V. Cost estimate .................................................................................................. 21 

VI. Regulatory impact statement ........................................................................ 23 

VII. Application of law to the legislative branch ................................................ 23 

VIII. Section-by-section analysis ............................................................................ 23 

IX. Changes in existing law ................................................................................ 25 

I. PURPOSE AND NEED FOR LEGISLATION

The Health Care Safety Net Act of 2007 reauthorizes and 

strengthens three programs which together provide a safety net 

that helps millions of Americans each year access needed health 

care services. In doing so, the committee is acting to maintain, improve, and increase its support for these programs, which enable 

safety net providers located in rural and urban areas throughout 

this country to offer health care services to millions of underserved 

and uninsured people. The programs included in this act are: 


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• The Health Centers program, established under Title III, Section 330 of the Public Health Service Act; supports the provision 

of health care and related services to the medically underserved—

meaning those individuals living in rural or urban communities 

that are federally-designated as medically underserved, or whose 

populations are members of a federally-designated medically underserved population. 

• The National Health Service Corps, authorized under Title III, 

Sections 331 through 338L of the Public Health Service Act; assists 

in the delivery of health services in health professional shortage 

areas by providing access to scholarships and loan repayments to 

eligible clinicians. 

• Rural Health Programs, located in Title III, Sections 330A, 

330I, 330J, and 330K of the Public Health Service Act; assist with 

the provision of coordinated care in rural areas. These programs include the Rural Health Care Services Outreach, Rural Health Network Development, Small Health Care Provider Quality Improvement, Telehealth Network, Telehealth Resource Centers, Rural 

Emergency Medical Service Training and Equipment Assistance, 

and Mental Health Service Delivered Via Telehealth. 

THE HEALTH CENTERS PROGRAM

Introduction 

The Committee has a long history of supporting the work of safety net providers in urban and rural areas who dedicate their efforts 

to providing care for those individuals who would otherwise not 

have access to a regular source of health care. At a time when 47 

million Americans are without health insurance and over 56 million lack adequate access to a primary care physician due to an actual physician shortage in their communities, existing safety net 

providers continue to grapple with increasing demands for care 

from the uninsured and underinsured populations in this country. 

Thousands of communities across the country today continue to experience shortages of accessible, cost-effective, preventive and primary health care services especially for individuals who are unable 

to pay for such care. 

History of Health Centers Program 

In response to the large number of individuals living in medically 

underserved areas, as well as the growing number of special populations lacking access to preventive and primary health care services, in 1965, Congress created the Health Centers program, formally authorizing it in 1975. For more than 40 years, the Health 

Centers program has effectively and efficiently assured access to 

cost-effective, high quality, preventive and primary care services, 

thereby improving the health status of the Nation’s underserved 

and vulnerable populations. This program was designed to empower communities to address local health access challenges and to 

improve the health status of their underserved and vulnerable populations. Health centers do this by building community-based primary care capacity and by offering case management, home visitation, outreach, and other enabling services to increase utilization 

by vulnerable populations and improve the effectiveness of the preventive and primary care they offer. Health centers serve as a proVerDate Aug 31 2005 05:42 Mar 14, 2008 Jkt 069010 PO 00000 Frm 00002 Fmt 6659 Sfmt 6602 E:\HR\OC\SR274.XXX SR274

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1 National Association of Community Health Centers and The Robert Graham Center. Access 

Denied: A Look at America’s Medically Disenfranchised. March 2007. www.nachc.com/researchdata.cfm. NACHC and Association of Community Affiliated Plans, The Impact of Health Centers 

and Community-Affiliated Health Plans on Emergency Department Use, April 2007. 

www.nachc.com/research-data.cfm. National Association of Community Health Centers, The 

Robert Graham Center, and Capital Link. Access Granted: The Primary Care Payoff. August 

2007. www.nachc.com/research-reports.cfm. 

totype for effective public-private partnerships, demonstrating their 

ability to meet pressing local health needs while being held accountable for meeting national performance standards. The care 

provided at health centers contributes to success of the program in 

reducing avoidable hospitalizations, lowering emergency room use, 

and lessening the need for specialty care, thus saving billions for 

taxpayers and society.1

Core requirements of the Health Centers Program 

The Health Centers program’s core elements found in Section 

330 of the Public Health Service Act, as established by Congress, 

and last reauthorized in 2002 as part of the Health Care Safety 

Net Amendments Act, Public Law (P.L.) 107–251 stipulate that 

each Federally-supported health center must: 

1. Be located in, and serve, a community that is federallydesignated as ‘‘medically underserved,’’ thus ensuring the proper targeting of Federal resources to areas of greatest need; 

2. Make its services available to all residents of the community, without regard for ability (or inability) to pay for such 

services, and make those services affordable by discounting the 

health center’s charges in accordance with family income for 

otherwise uncompensated care provided to low-income families; 

3. Provide comprehensive primary health care services, including preventive care (such as regular check-ups and pap 

smears), care for acute and chronic illnesses and injuries, services to improve both the accessibility of care (such as transportation and translation services) and the effectiveness of care 

(such as health/nutrition education), and patient case management; 

4. Be governed by a board of directors, a majority of whose 

members are active, registered patients of the health center, 

thus ensuring that the center is responsive to the health care 

needs of the community it serves. 

Health centers must also meet strict operational, clinical and financial standards, as well as reporting and performance requirements. 

Types of health centers 

During the 1996 reauthorization of the Health Centers program 

(Health Centers Consolidation Act of 1996, P.L. 104–299), the committee consolidated four separately targeted health center authorities under a single authority, while maintaining distinct resources 

to serve vulnerable subpopulations of migrant and seasonal farm 

workers and their families, homeless individuals, and residents of 

public housing. The program currently serves over 17 million mediVerDate Aug 31 2005 05:42 Mar 14, 2008 Jkt 069010 PO 00000 Frm 00003 Fmt 6659 Sfmt 6602 E:\HR\OC\SR274.XXX SR274

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2 NACHC, 2008 based on Bureau of Primary Health Care, HRSA, DHHS, 2006 Uniform Data 

System (UDS). It includes patients of federally-funded health centers, non-federally funded 

health centers (health center ‘‘look-alikes’’), and expected patient growth for 2007–2008. 3 NACHC, 2008 based on Bureau of Primary Health Care, HRSA, DHHS, 2006 Uniform Data 

System (UDS). 

cally underserved people in more than 6,300 service delivery sites 

in every State and territory.2

1. Community Health Centers—Community Health Centers were 

first funded by Congress in the mid–1960s as neighborhood health 

centers. By the early 1970s, approximately 100 neighborhood 

health centers had been established under the Economic Opportunity Act. These centers were designed to provide accessible, personal health services to low-income families. Community and consumer participation in the organization and ongoing governance of 

the centers remain central elements of the program. Each center 

is required to have a governing board, a majority of whose members are comprised of consumers of the center’s services. 

With the phase-out of the Office of Economic Opportunity in the 

early 1970s, the centers supported under this authority were transferred to the Public Health Service Act. While services were directed to the poor and near poor, the centers also provided access 

to a broader population who could pay all or part of the cost of 

their health care. The Community Health Center program, as authorized under Section 330 of the Public Health Service Act, was 

established in 1975 by Public Law (P.L.) 94–63. 

2. Migrant Health Center—The Migrant Health Center program 

was established by Congress in 1962 under the Migrant Health 

Act, P.L. 87–692, and was reauthorized in 1975 by P.L. 94–63. Migrant Health Centers were created to provide a broad array of 

medical and support services to farmworkers and their families. In 

addition to primary and preventive health care, many of these centers provide transportation, translation, outreach, dental, pharmacy, and environmental health services. In 2002, P.L. 107–251 

clarified the eligibility of certain farmworkers to receive health center services at section 330-funded health centers. The 2002 reauthorization also called for the Department of Health and Human 

Services to conduct a study of the barriers to enrollment in and the 

possible solutions to the challenges faced by farmworkers under 

Medicaid and the State Children’s Health Insurance Program. In 

2006, a network of 140 migrant health centers provided services to 

over 800,000 migrant and seasonal farmworkers and their families 

in more than 1,052 delivery sites.3

3. Health Care for the Homeless—The Health Care for the 

Homeless program was established by Congress to provide comprehensive, high quality, case-managed, preventive and primary 

health care services, including substance abuse services and mental 

health referrals, for homeless individuals at locations accessible to 

them. With the enactment of P.L. 107–251, Congress clarified the 

eligibility of homeless youth and formerly homeless persons to receive section 330-funded services during the first 12 months following their transition to permanent housing, in order to ensure 

that the program remained appropriately targeted to the most vulnerable populations. 

The Health Care for the Homeless program has played (and continues to play) a pivotal role in stimulating local collaboration and 


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4 Administration FY 2001 Budget Overview. 

coordination of health and social services. A total of 184 organizations, including community health centers, public health departments, and other community-based health service providers, currently provide care to approximately 828,000 sick and underserved 

homeless people annually. 

4. Health Services for Residents of Public Housing—The Health 

Services for Residents of Public Housing program was established 

by Congress under the Disadvantaged Minority Health Improvement Act of 1990. This legislation focused on the disparity in 

health status of minority populations and placed emphasis on the 

development of comprehensive delivery models that address the 

special health problems which affect families residing in public 

housing complexes—especially targeting pregnant women and children. Services are provided at public housing complexes or at sites 

either adjacent to or immediately accessible to these complexes. In 

2006, 37 organizations received funding under the program, and 

provided comprehensive, high quality, case-managed, family-based 

preventive and primary health care services to approximately 

70,000 public housing residents. 

Expansion of Health Centers Program 

In 2000, Congress launched a historic plan—the Resolution to 

Expand Access to Community Health Centers (REACH) Initiative—which pledged to double access to community health centers 

in medically underserved areas over 5 years. With this initiative 

came an unprecedented $150 million increase in Federal funding 

for health centers, and the Health Centers program entered into a 

period of unparalleled growth. In 2001, the Bush administration 

joined this historic initiative, pledging to continue to expand the capacity of health centers to provide care.4

Wide bipartisan support in Congress has supported these goals 

and has ensured the necessary funding increases to expand the 

program, while supporting the infrastructure of existing centers. At 

the start of the President’s Expansion Initiative in 2001, 10 million 

patients were served by the Health Centers Program. By 2006, new 

and expanded access points created access to care for more than 16 

million people who were served at 6,000 service delivery sites in 

every State and territory. Additionally, support from the President 

and Congress have allowed several existing health centers to expand the services they offer beyond primary medical and preventive care. Service expansions have assisted health centers in providing mental health, dental, pharmaceutical and optometric services. 

Success of the Health Centers Program 

Since the reauthorization in 2002, the Health Centers program 

has continued to develop and implement a significant number of 

highly successful, innovative, preventive, and primary health care 

delivery approaches in our Nation’s most needy inner cities and 

rural areas. 

Health centers are effective in increasing access to health care 

services in needy communities. In 2006, more than 16 million patients were served at health centers—representing a 32.7 percent 


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5 NACHC, 2008 based on Bureau of Primary Health Care, HRSA, DHHS, 2006 Uniform Data 

System (UDS). 6Starfield B and Shi L. ‘‘The Medical Home, Access to Care, and Insurance: A Review of Evidence.’’ May 2004 Pediatrics 113(5):1493–8. Hadley J and Cunningham P. ‘‘Availability of Safety 

Net Providers and Access to Care of Uninsured Persons.’’ October 2004 Health Services Research 39(5):1527–1546. O’Malley AS, et al. ‘‘Health Center Trends, 1994–2001: What Do They 

Portend for the Federal Growth Initiative?’’ March/April 2005 Health Affairs 24(2):465–472. Shi 

L. Regan J, Politzer RM, Luo J. ‘‘Community Health Centers and Racial/Ethnic Disparities in 

Healthy Life.’’ 2001 International Journal of Health Services 31(3):567–582. Forrest CB and 

Whelan EM ‘‘Primary care safety-net delivery sites in the United States: A comparison of community health centers, hospital outpatient departments, and physicians’ offices.’’ 2000 JAMA 

284(16):2077–2083. O’Malley et al, 2005. 7Shi, L. Steven, G.D., Wulu, J.T., Politzer, R. M., & Xu, J. America’s health centers: Reducing 

Racial and Ethnic Disparities in Perinatal Care and Birth Outcomes. 2004. Health Services Research, 39 (6, Part 1), 1881–1901. 8 NACHC, 2008 based on Bureau of Primary Health Care, HRSA, DHHS, 2006 Uniform Data 

System (UDS). 

increase over the 11.3 million persons served in 2002. Of those 16 

million patients, over 6 million patients or 40 percent of all health 

center patients were uninsured—a 34 percent increase over the 4.4 

million uninsured individuals served by centers in 2002. Further, 

in 2006, 23.3 percent of those uninsured individuals were children. 

Three million health center patients are enrollees in managed care 

systems. Health centers serve 1 in 7 uninsured persons, 1 in 9 

Medicaid beneficiaries, and 1 in 4 low-income individuals in the 

United States today.5

Furthermore, health centers are effective at improving health 

outcomes, increasing access to preventive services, improving the 

management of chronic diseases, mitigating health disparities, and 

reducing avoidable hospitalizations.6 The rates of infants born at 

low birth weights are lower at health centers than nationally, even 

though health center patients are more at risk. Women of low 

socio-economic status seeking care at health centers experience 

lower rates of low birth weight compared to all low-social economic 

status mothers (7.5 percent vs. 8.2 percent).7 This trend holds for 

each racial/ethnic group, which is particularly noteworthy for African-American women who are especially at higher risk for adverse 

pregnancy outcomes. Given that two-thirds of health center patients belong to a minority group with an increased risk for low 

birth weight infants, this particular statistic demonstrates the competent care that health centers provide. 

According to a 2002 Health Resources and Services Administration (HRSA) Community Health Center User survey, women who 

receive their care at health centers are more likely to receive a pap 

test than if they were to receive care elsewhere. This increased access to necessary preventive health services also is evident for 

women who are Hispanic and African-American. Furthermore, 

health centers have been shown to effectively mitigate health disparities. According to a report by the George Washington University, as health centers serve more of a State’s low-income population, key State level disparities in communities of color decline. 

Health centers provide care to millions of Americans suffering 

from chronic diseases. In 2006, Health Centers treated more than 

927,000 patients with diabetes, 237,500 patients with heart disease, almost 1,461,000 patients with high blood pressure, and nearly 461,000 patients with asthma.8 In fact, fully one quarter of all 

health center patient visits are related to a chronic illness. 

Studies comparing health center patients and non-health center 

patients demonstrate that health centers provide services at a 


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9McRae T. and Stampfly R. ‘‘An Evaluation of the Cost Effectiveness of Federally Qualified 

Health Centers (FQHCs) Operating in Michigan.’’ October 2006 Institute for Health Care Studies at Michigan State University. www.mpca.net. Falik M, Needleman J, Herbert R, et al. ‘‘Comparative Effectiveness of Health Centers as Regular Source of Care.’’ January–March 2006 Journal of Ambulatory Care Management 29(1):24–35. 

Garg A, Probst JC, Sease T, Samuels ME. ‘‘Potentially Preventable Care: Ambulatory CareSensitive Pediatric Hospitalizations in South Carolina in 1998.’’ September 2003 Southern Medical Journal 96(9):850–8. Epstein AJ. ‘‘The Role of Public Clinics in Preventable Hospitalizations 

among Vulnerable Populations.’’ 2001 Health Services Research 32(2):405–420. 

Falik M, et al. ‘‘Ambulatory Care Sensitive Hospitalizations and Emergency Visits: Experiences of Medicaid Patients Using Federally Qualified Health Centers.’’ 2001 Medical Care 

39(6):551–56. Stuart ME, et al. Improving Medicaid Pediatric Care. Spring 1995 Journal of Public Health Management Practice 1(2):31–38. 

Starfield B, et al. Costs vs. Quality in Different Types of Primary Care Settings, 28 December 

1994 Journal of the American Medical Association 272(24):1903–1908. 

Duggar BC, et al. Utilization and Costs to Medicaid of AFDC Recipients in New York Served 

and Not Served by Community Health Centers. Center for Health Policy Studies, 1994. 

Duggar BC, et al. Health Services Utilization and Costs to Medicaid of AFDC Recipients in 

California Served and Not Served by Community Health Centers. Center for Health Policy Studies, 1994. 

Braddock D, et al. Using Medicaid Fee-For-Service Data to Develop Health Center Policy. 

Washington Association of Community Health Centers and Group Health Cooperative of Puget 

Sound, 1994. 10 Chin MH, et al. ‘‘Improving Diabetes Care in Midwest Community Health Centers With the 

Health Disparities Collaborative.’’ January 2004 Diabetes Care 27(1):2–8. 11 Chin MH, et al. ‘‘Improving Diabetes Care in Midwest Community Health Centers With the 

Health Disparities Collaborative.’’ January 2004 Diabetes Care 27(1):2–8. 12 Institute of Medicine (IOM). Coverage Matters: Insurance and Health Care. National Academy of Sciences Press, 2001. 

lower cost per ambulatory visit, while lowering the rate of hospital 

inpatient days, and lower total costs of care (including decreased 

inpatient care costs).9 Recently, the Health Centers program was 

recognized by the Office of Management and Budget as one of the 

most effective and efficiently run programs in the Department of 

Health and Human Services. 

As testament to health centers’ ongoing commitment to the delivery of high-quality health services, nearly 85 percent of health centers have participated in one or more of HRSA’s Health Disparities 

Collaboratives, initiatives which focus on improving health outcomes for chronic conditions among medically-vulnerable populations, particularly minorities. The Collaboratives are designed to 

enhance the skills of clinical staff, strengthen the process of care 

through the development of extensive patient registries that improve clinicians’ ability to monitor and manage the health of individual patients, and effectively educate patients on self-management of their conditions. Health center patients with chronic disease are enrolled in electronic registries for diabetes, cardiovascular disease, asthma, depression, prevention, cancer, and HIV. 

Eventually, every health center may be participating in at least 

one Collaborative.10

A study of 19 Midwestern health centers participating in the Diabetes Collaboratives demonstrated improved measures of diabetesrelated health outcomes and quality (e.g., HbA1c measurement, eye 

examination referral, foot examination, and lipid assessment). The 

authors concluded that in just 1 year, the model employed by the 

Collaboratives improved diabetes care at the health centers.11 As 

a result of the success of the Collaboratives, the Institute of Medicine (IOM) commended health centers for providing chronic care 

management that is ‘‘at least as good as, and in many cases superior to, the overall health system in terms of better quality and 

lower costs,’’ and recommended health centers as models for reforming the delivery of primary health care.12 The General AcVerDate Aug 31 2005 06:27 Mar 14, 2008 Jkt 069010 PO 00000 Frm 00007 Fmt 6659 Sfmt 6602 E:\HR\OC\SR274.XXX SR274

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countability Office (GAO) has recently recognized the 

Collaboratives as a promising Federal program targeting health 

disparities that should be expanded. 

The committee recognizes that the Health Centers program has 

been successful because of the ability of the centers to offer integrated, high quality, prevention-oriented, case-managed, and family-focused primary and preventive care services that result in appropriate and cost-effective use of ambulatory, specialty, and inpatient services by other providers. Health centers offer primary care 

for people of all life cycles, and a range of health and other social 

services is available on-site or through referrals. 

This broad range of services includes health promotion, disease 

prevention, screening, educational, outreach, and case management 

services—services that are often missing from the traditional delivery of medical care, but which are particularly needed by high-risk 

populations with multiple health problems and facing significant 

barriers to access to care. Congress broadened this range of health 

center services in P.L. 107–251 by increasing the types of additional health services for which grant funding may be provided 

with the inclusion of behavioral and mental health services, public 

health services, and recuperative care services as optional services 

that health centers can choose to provide. Additionally, the 2002 

reauthorization revised the definition of ‘‘environmental health 

services’’ to permit health centers to offer the detection and alleviation of chemical and pesticide exposures, the promotion of indoor 

and outdoor air quality, and the detection and remediation of lead 

exposures. 

More than 11,887 primary care physicians, nurse practitioners, 

physician assistants, and certified nurse midwives create the core 

clinical staff of health centers nationally. Further, health centers 

are home to 2,626 dentists and hygienists, as well as 1,559 psychiatrists and other mental health providers. Health centers also have 

been assisted greatly in attracting and retaining quality providers 

through the National Health Service Corps. Health centers have 

also been actively involved with academic medical centers in providing community-based training of physicians, nurses, and other 

health professionals. 

In addition, the Health Center program has enabled underserved 

communities to design and develop their own local solutions to 

their problems of medical underservice. By supporting the development and operation of health centers at the community level, the 

health centers program has assured that centers are community-responsive and accessible. Community members and patients play an 

active role in centers’ decisionmaking and planning. By working 

with local communities and State organizations to plan, develop, 

and determine priorities for the allocation of resources, the Health 

Center program has successfully funded new and expanded programs and services in those communities that are most in need. 

Community Health Centers attract private-pay and privately insured individuals and families, in addition to individuals who are 

uninsured or covered by Medicaid. 

Several studies over the years have reported favorably on the 

quality and cost-effectiveness of the care offered by health centers. 

These studies cite evidence of health centers’ clinical quality and 

patient satisfaction measures which compared favorably to national 


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13Shin P, Markus A, and Rosenbaum S. Measuring Health Centers against Standard Indicators of High Quality Performance: Early Results from a Multi-Site Demonstration Project. Interim Report. Prepared for the United Health Foundation, August 2006. www.gwumc.edu/sphhs/ 

healthpolicy/chsrp/downloads/United_Health_Foundation_report_082106.pdf. 14 NACHC, 2008 ‘‘Access Granted: The Primary Care Payoff’’. 15 HRSA, data as of September 30, 2007. 16 National Association of Community Health Centers and The Robert Graham Center. Access 

Denied: A Look at America’s Medically Disenfranchised. March 2007. www.nachc.com/researchdata.cfm. 

standards.13 Studies demonstrate that patients in underserved 

areas served by health centers had 5.8 fewer hospitalizations per 

1,000 people over 3 years than those in areas not served by health 

centers. According to the National Association of Community 

Health Centers, medical expenses for health center patients are 41 

percent lower compared to patients seen elsewhere. As a result, 

they save the health care system between $9.9 and $17.6 billion a 

year.14

Continued need for health centers 

While the Health Centers Program has made historic gains in 

providing increased access to and availability of health care services in medically-underserved communities and populations, major 

challenges still persist. Lack of access to affordable and readily 

available primary and preventive care remains a pervasive problem 

throughout the United States. Millions of Americans experience financial barriers to getting care. Today, 47 million Americans are 

uninsured, and that number continues to rise. At the same time 

that Americans are becoming uninsured in larger numbers, the 

amount of charity care that physicians provide has been decreasing. According to the Center for Studying Health Systems Change, 

the percentage of physicians providing any free or reduced cost care 

decreased from 76.3 percent in 1996 to 68.2 percent in 2004. Additionally, other Americans experience barriers to care due to geography or system capacity. Currently, over 62 million people live in 

places designated as Health Professions Shortage Areas,15 and 56 

million Americans are considered ‘‘medically disenfranchised’’ because they live in areas with insufficient numbers of primary care 

physicians.16 Other Americans face transportation, cultural or language barriers to care, and racial, and ethnic, and geographic disparities in access to and quality of care continue. 

Despite the success of the President’s expansion program, only 6 

million uninsured people are reached by health centers, accounting 

for only 13 percent of the Nation’s uninsured. Fewer than half of 

all approvable applications for new or expanded health center sites 

received funding from 2002–2006, demonstrating a demand for continued expansion. Many underserved communities continue to lack 

adequate resources to submit a competitive application, and in 

some cases to even coordinate and complete the current application. For these reasons, the committee authorized significant funding increases for this important program. 

Health Centers Programs in a changing health care environment 

Health centers have done an excellent job of adapting to the 

changing health care environment. In 1996, the committee permitted the use of grant funds to support the establishment of managed care networks and plans. Health centers across the country 

have taken steps to form networks with other local providers and 


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develop the financial, legal, and business acumen necessary to 

function effectively in managed care. Almost three-fourths of all 

health centers are participating in managed care as subcontracting 

providers to managed care plans—serving 3 million managed care 

enrollees. 

As the market continues to change, health centers are joining 

with each other and with other local providers to form integrated 

service delivery networks to coordinate and improve their purchasing power and/or to better organize the continuum of care, especially for uninsured populations. Through networks, health centers are able to leverage their talents and resources to improve 

health outcomes, cut administrative costs, reduce health disparities, and employ health information technology and electronic medical records. These networks include practice management networks designed to improve quality through shared expertise (such 

as centralized pharmaceutical or laboratory services, clinical outcomes management, or joint management/administrative services); 

to lower costs through shared services (such as unified financial or 

management information systems, or joint purchasing of services or 

supplies); to improve access and availability of health care services 

provided by the health centers participating in the network; and/ 

or to improve the health status of communities by establishing 

community-based programs such as vaccine and wellness initiatives. 

Today, nearly 200 health centers are involved in approximately 

20 local and regional operational networks across a majority of 

States, each designed to lower costs and improve care. In the 2002 

Health Care Safety Net Amendments, Congress authorized the use 

of up to 2 percent of Section 330 appropriations for the funding of 

health center networks. 

Since the last reauthorization of the Health Centers program, 

Health Information Technology (HIT) has emerged as a valuable 

resource for all health care providers. In order to better coordinate 

care and improve patient outcomes and quality, health care providers and medical institutions throughout the health system have 

adopted HIT and Electronic Medical Records (EMR). Use of HIT 

and EMR reduces medical errors, allows for greater coordination of 

care, improves the quality of care delivered, and saves money at 

the individual and systemic level. While a majority of health centers (60 percent) plan on implementing an Electronic Health 

Records (EHR) system in the near future, currently 13 percent of 

health centers have a fully operational EHR system. Lack of capital 

resources is overwhelmingly named as the biggest obstacle to adoption. By integrating health information technology into operations, 

health centers will connect more effectively with the entire health 

care system, and can continue to lead the way toward an improved 

system of care. 

NATIONAL HEALTH SERVICE CORPS

Introduction 

The National Health Service Corps (NHSC), authorized under 

Title III of the Public Health Service Act, plays a critical role in 

providing care for medically underserved populations by placing clinicians in urban and rural communities with severe shortages of 


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17 American College of Physicians. The Impending Collapse of Primary Care Medicine and Its 

Implications for the State of the Nation’s Health Care. January 30, 2006. http:// 

www.acponline.org/hpp/statehc06l1.pdf. 18 Council on Graduate Medical Education (January 2005). Sixteenth Report: Physician Workforce Policy Guidelines for the United States, 2000–2020. http://www.cogme.gov/16.pdf. 

health care providers. The NHSC is comprised of scholarship and 

loan repayment programs that provide education assistance to 

health professions students in return for a period of obligated service in a shortage area. 

Background and need for Program 

Nationwide, there is a shortage of primary care providers, and 

this problem is exacerbated in rural and certain urban areas. The 

availability of primary care physicians has deteriorated in recent 

years. In fact, the number of primary care physicians per capita 

has changed very little, while the number of specialists has been 

rapidly growing—accounting for more than three-quarters of the 

growth in per capita physicians from 1980 to 1999. At the same 

time, it is estimated that the demand for primary care providers 

will increase 38 percent from 2000 to 2020. The lack of primary 

care physicians is expected to be compounded by a rapidly rising 

elderly population. The number of people ages 65 and older is expected to grow 54 percent between 2000 and 2010, while the number over the age of 85 will grow 43 percent over the same time.17

This combination of factors will lead to a growing shortage of primary care providers, estimated by the Council on Graduate Medical Education to be a shortage of at least 90,000 full time physicians by 2020.18 Communities that are already experiencing shortages are especially likely to be hard hit. Additionally, low income 

individuals will bear a significant burden, because studies suggest 

that fewer physicians are willing to treat Medicaid and uninsured 

patients. Therefore, investment in the NHSC program, which helps 

to get providers in these medically underserved communities, is 

needed. 

While NHSC assignees are successful in providing health care 

services to nearly 5 million Americans each year, there is still a 

great need for investment in the program. This is demonstrated by 

the fact that there are more qualified applicants to the NHSC program than awards available to be made. In 2006 there were approximately 1,800 applicants to the program, but only sufficient 

funding to award approximately 800 awards. Additionally, the 

number of vacancies posted on the NHSC Job Opportunity List far 

exceeds the number of NHSC awardees. As of October 2007, there 

were 4,888 vacancies posted on the Job Opportunity List, with 55 

percent (2,704) of these in health centers. 

History and description of program 

The National Health Service Corps (NHSC) program was originally enacted by the Emergency Health Personnel Act of 1970 to 

respond to the geographic misdistribution of primary care health 

professionals. In 1972, Congress created the Scholarship programs 

to allow health professions students to receive support for their 

educational costs in return for service in a designated area. In return for each year of scholarship support they receive, students 

agree to provide services for 1 year, with a 2-year minimum service 


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12 

obligation. In 1987, Congress enacted the NHSC Loan Repayment 

program, under which the Federal Government agrees to repay 

both governmental and commercial loan obligations incurred by 

health professionals for their education in exchange for service in 

a designated area. In that same year, Congress established a State 

Loan Repayment program. Under this program, if a State establishes a loan repayment program similar to the NHSC Loan Repayment program, the Department could fund up to 75 percent of the 

total costs through a grant to the State. 

In 1990, Congress reauthorized the NHSC, extending the program for 10 years with the enactment of the National Health Service Corps Revitalization Amendments of 1990 (P.L. 101–597). In reauthorizing the NHSC, Congress made several changes to the program, including a strict prioritization of areas of greatest shortages 

for placement of new assignees; requirements to include individual 

assignees’ characteristics in making placements; improved incentives for recruitment and retention of health professionals; increased utilization of nurse practitioners, physician assistants, and 

nurse midwives; and renaming of Health Manpower Shortage 

Areas (HMSAs) to Health Professions Shortage Areas (HPSAs). 

The NHSC was last reauthorized in 2002, and this authorization 

expired on September 30, 2006. 

While the NHSC program has proven successful in addressing 

health professional shortages in many areas, funding limitations 

have restricted the program’s ability to meet its primary goal. After 

reauthorization of the NHSC in 2002, funding for the program increased to $171 million in fiscal year 2003, $169.9 million in fiscal 

year 2004, and $131.4 million in fiscal year 2005, before returning 

to the fiscal year 2001 level of $125 million in fiscal year 2006 and 

fiscal year 2007. 

According to HRSA, in 2006, 4,109 clinicians were practicing in 

underserved areas through the National Health Service Corps. Of 

these, 2,051 clinicians worked in grant supported health centers, 

while the remaining 2,058 clinicians worked in ‘‘free standing’’ sites 

which include rural health centers, public health departments, 

community mental health centers, private and group practices, Indian Health Service sites (tribal and Federal), State and Federal 

prisons, and Immigration and Customs Enforcement sites. NHSC 

funding is available to a variety of clinicians, including physicians 

(including psychiatrists), dentists, dental hygienists, nurse practitioners, physician assistants, nurse midwives, and mental and behavioral health professionals. Throughout its history, NHSC 

awards have also been made to other types of providers such as optometrists, chiropractors, and pharmacists. The committee notes 

that in many cases, the provision of some health care services may 

not have been possible without the presence of an NHSC assignee. 

Nevertheless, the committee also notes that partly due to a lack of 

adequate funding, the NHSC has a limited capacity to meet the 

needs of people living in primary care, mental, or dental HPSAs. 

Relationship between health centers and rural health clinics and 

the NHSC 

There is synergy between the NHSC program and the community 

health centers program and rural health clinics because both entities frequently utilize NHSC providers to staff their facilities. HowVerDate Aug 31 2005 05:42 Mar 14, 2008 Jkt 069010 PO 00000 Frm 00012 Fmt 6659 Sfmt 6602 E:\HR\OC\SR274.XXX SR274

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ever, despite the investment already being made in placing providers in these entities, there is still a shortage of providers in 

these, as well as other settings. In light of the national shortage 

of primary care providers, the committee strongly believes that we 

must act to reauthorize and improve the NHSC program to help 

meet the need for physicians caring for underserved populations. 

Our increased investment in community health centers since 2001 

should be matched by additional authorizations for the NHSC as 

well. 

RURAL HEALTH CARE PROGRAMS

In section 330A(j) of the PHSA, the committee reauthorizes Rural 

Health Care Services Outreach, Rural Health Network Development, and Small Health Care Provider Quality Improvement Grant 

Programs. The programs in section 330A(j) specifically consider the 

diversity of rural America and have provided rural communities 

with flexible mechanisms of receiving Federal funds for specific 

health care needs. The five grant programs under this authority 

support collaborative models to deliver basic health care services to 

the 54 million Americans living in rural areas. 

The Rural Health Care Services Outreach Program supports 

projects that demonstrate creative or effective models of outreach 

and service delivery in rural communities that lack essential 

health care services. The emphasis is on community involvement in 

the development and ongoing operation of the program, requiring 

the grantee to form a consortium with at least two additional partners. Through consortia of schools, churches, emergency medical 

service providers, local universities, private practitioners and the 

like, rural communities have managed to provide many services including hospice care, health check-ups for children and prenatal 

care to women in remote areas. The population served by the 

grants has historically been across the spectrum of care, with a majority of grants focusing on the non-Medicare population. The Department of Health and Human Services estimates these funds 

have brought care that would not otherwise have been available to 

at least 2 million rural citizens across the country. In the past 3 

years, this program has funded many projects, including a grant to 

rural New Hampshire enabling implementation of a chronic disease 

management program for individuals with diabetes and congestive 

heart failure; a grant to rural Louisiana targeting at-risk and obese 

preteens; and a program in rural Kansas providing dental services 

targeted to children and pregnant women. The general program 

line includes support for grants to the eight States in the Mississippi Delta for network and rural health infrastructure development, and a cooperative agreement supporting targeted activities 

focusing on frontier extended stay clinics. 

The Small Health Care Provider Quality Improvement provision, 

a subset of the Rural Health Outreach Grant Program, was added 

to this authority when the program was re-authorized by the Safety Net Amendments of 2002. The programs were initially funded 

in 2006. These grants help small health care providers focus on 

specific interventions to improve health care quality in specific 

chronic disease areas. Fifteen grants were awarded in fiscal year 

2007 with a focus on diabetes, and there are plans for up to 60 

grants in fiscal year 2008 targeting cardiovascular disease. These 


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grant programs provide an opportunity for grantees to improve 

quality and enhance small rural health care providers in delivering 

care to rural communities. 

The Rural Health Network Development grant program allows 

grants to fund the integration of health services provided by rural 

communities. This integration helps to overcome the fragmentation 

of health care services in rural areas, improves the coordination of 

those services, and achieves economies of scale. The grants focus on 

integrating clinical, information, administrative and financial systems across members. This integration enables rural communities 

to strengthen the infrastructure of health delivery. 

In authorizing the continuation of these programs, the committee 

recognizes the great importance of these flexible grants in enabling 

smaller, rural communities to provide health services to a population of about 3.2 million that is frequently underserved, have 

higher rates of poverty and unemployment, are older, and have a 

poorer health status. 

II. SUMMARY

The purpose of the Health Care Safety Net Act of 2007 is to 

amend the Public Health Service Act to provide additional authorizations of appropriations for fiscal year 2008 through fiscal year 

2012 for Health Centers, the National Health Service Corps, and 

Rural Health Programs, to meet the health care needs of medically 

underserved populations. 

COMMUNITY HEALTH CENTERS

The legislation increases authorization levels for the health centers program, and also authorizes several studies including: 

1. A school based health center study conducted by the Comptroller General of the United States. 

2. A health care quality study conducted by the Agency for 

Healthcare Research and Quality. 

3. A study on an integrated health systems model for the delivery of care to medically underserved population conducted by the 

Comptroller General of the United States. 

NATIONAL HEALTH SERVICE CORPS

The National Health Service Corps is amended by increasing the 

authorization levels for fiscal year 2008 through fiscal year 2012. 

Additionally, the bill strikes language that placed a 6-year time 

limit on automatic Health Professional Shortage Area (HPSA) facility designations that were extended to Federally Qualified Health 

Centers (FQHCs) and Rural Health Clinics (RHCs). The NHSC is 

also amended to provide increased emphasis on professional development and training for Corps members. 

RURAL HEALTHCARE PROGRAMS

The authorization level for rural health care programs is increased to $45 million for fiscal years 2008 through 2012. 

III. HISTORY OF LEGISLATION AND VOTES IN COMMITTEE

The Community Health Centers, National Health Service Corps, 

and rural health programs were last reauthorized in the 107th 


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15 

Congress with the Health Care Safety Net Amendments of 2001 (S. 

1533). This bill was passed by the House and Senate, and became 

Public Law No. 107–251 on October 26, 2002. 

During the 109th Congress, Senator Hatch and 63 cosponsors introduced, S. 3771, The Health Centers Renewal Act of 2006. This 

bill amended the Public Health Service Act to include increased authorization of appropriations for the Community Health Centers 

program. The bill was read twice and referred to the committee. On 

September 20, 2006, the committee ordered the bill to be reported 

without amendment favorably to the full Senate. On September 25, 

2006, Senator Enzi reported the bill with an amendment in the nature of a substitute, without written report. The bill was placed on 

the Senate Legislative Calendar under General Orders (Calendar 

no. 638). No further action was taken on this bill during the 109th 

Congress. 

The bill was reintroduced in the 110th Congress as S. 901, the 

Health Centers Renewal Act of 2007 by Senator Kennedy on March 

15, 2007. The bill, which had 17 original cosponsors, and 68 total 

cosponsors, amended the Public Health Service Act to include increased authorization of appropriations for the Community Health 

Centers program for fiscal years 2008 through 2012. The bill was 

combined with S. 941 introduced by Senator Sanders. On November 14, 2007 the committee considered and unanimously approved 

a manager’s amendment to S. 901, and the committee approved the 

bill, as amended, by voice vote. The bill was placed on the Senate 

Legislative Calendar under General Orders (Calendar no. 548) on 

December 18, 2007. 

IV. EXPLANATION OF BILL AND COMMITTEE VIEWS

The committee recognizes that the health centers, NHSC, and 

rural grants programs have made a significant contribution to the 

health of medically needy populations. The committee bill reauthorizes the programs, and increases the authorization levels for 5 

years, beginning in fiscal year 2008. 

COMMUNITY HEALTH CENTERS

Explanation of bill 

The legislation increases the authorization levels for the community health centers program as follows: 

$2,213,020,000 in fiscal year 2008; 

$2,451,394,400 in fiscal year 2009; 

$2,757,818,700 in fiscal year 2010; 

$3,116,335,131 in fiscal year 2011; and 

$3,537,040,374 in fiscal year 2012. 

Additionally, the legislation authorizes several studies as follows: 

1. A study on school-based health centers to be conducted by the 

Comptroller General of the United States. The study would determine the impact of Federal funding on the operation of schoolbased health centers, costs savings to other programs, the impact 

on the Federal budget and the health of students by providing 

funds, and the impact of access to health care from school-based 

health centers in rural or underserved areas. 

2. A health care quality study to be conducted by HRSA. HRSA 

would produce a report that describes the agency’s efforts to exVerDate Aug 31 2005 05:42 Mar 14, 2008 Jkt 069010 PO 00000 Frm 00015 Fmt 6659 Sfmt 6602 E:\HR\OC\SR274.XXX SR274

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pand and accelerate quality improvement activities in health centers. 

3. A study on the integrated health systems model for the delivery of health care services to medically underserved populations. 

The GAO shall conduct a study on integrated health systems models at not more than 10 sites. 

Forty-seven million Americans continue to lack health insurance 

and the number of uninsured continues to rise. Many private, nonprofit safety net providers have a historical mission of serving the 

poor and vulnerable and many of these providers established neighborhood clinics as a way to improve access to primary and preventive care, and to offer the uninsured a cost-effective alternative to 

the hospital emergency room for their primary care needs. In this 

study, the Comptroller General of the United States would be required to report back to Congress on the role of integrated health 

care systems in providing access to primary and preventive care to 

the medically underserved, as well as access to specialty and hospital care. For purposes of this study, an integrated health system 

is defined as a private nonprofit health system that has a demonstrated capacity and commitment to provide a full range of primary, specialty, and hospital care in both inpatient and outpatient 

settings and is organized to provide such care in a coordinated 

fashion. The Comptroller General should include in its report any 

economies of scale that are beneficial to a clinic because of its affiliation with a parent provider, current sources of its funding, patient 

mix based on income and insurance status, payer reimbursement 

rates in comparison to other providers, the number of patients 

served by the clinic, and whether these clinics improve specialty 

and hospital access for poor and vulnerable populations. 

Such study shall include an assessment of providers in a wide 

variety of settings, including inner city, frontier areas, and a major 

rural teaching hospital defined as a hospital that is located in a 

rural area (as defined in Section 1886(d)(2)(D) of the Social Security Act) that is engaged in approved graduate medical education 

residency programs in medicine, osteopathy, dentistry, or podiatry, 

and sponsors accredited residency and fellowship programs, including active programs in medicine, surgery, obstetrics/gynecology, pediatrics, family practice, and psychiatry. One nurse managed 

health clinic should also be included and would be defined as an 

integrated health system for purposes of this study (the term 

‘‘nurse-managed health clinic’’ means nurse-practice arrangement, 

managed by advanced practice nurses, that provides care for underserved and vulnerable populations and is associated with a 

school, college or department of nursing and/or an independent 

non-profit health or social services agency). Finally, clinics operated 

by large non-profit organizations with a historical commitment to 

providing primary and preventive care for the medically underserved should also be included. 

Committee views 

Importance of health centers’ base grant adjustments 

Considerable investment in new community health centers and 

in expansion of services at existing CHCs has occurred during the 

past 5 years with strong leadership by the Executive and CongresVerDate Aug 31 2005 05:42 Mar 14, 2008 Jkt 069010 PO 00000 Frm 00016 Fmt 6659 Sfmt 6602 E:\HR\OC\SR274.XXX SR274

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sional branches of the government. The committee supports the addition of new health centers and expansion of existing ones, and 

supports consideration of base grant adjustments for health centers 

that meet Program Expectation guidelines. Most CHCs operate on 

narrow margins, and there are ongoing requirements to keep up 

with rising costs for providers, facilities, technology, and energy in 

order to sustain current service levels. Health centers also face increasing numbers of uninsured and under-insured individuals as 

employer-based insurance shrinks. The committee notes that Congress has routinely allocated annual increased funding for existing 

centers to offset the rising cost of health care and to meet the demands for care for the uninsured populations served by the centers. 

The committee encourages HRSA to develop criteria and allocate 

funding that will allow health centers to receive an annual grant 

adjustment that adequately addresses rising costs, growing patient 

populations, and other pressing concerns as they arise. 

Value and importance of expanded technical assistance 

The committee believes that the health centers program has been 

successful in large part because of attention to continuous quality 

improvement to all facets of health center operations. The committee recognizes the valuable information, training and technical 

assistance activities performed by national, State and regional organizations that represent the recipients of service grants under 

the health centers program. These organizations have provided a 

full range of tools for health center staff, including training programs regarding financial management, clinical practice guidelines, 

regulatory and legal requirements, board governance, corporate 

compliance, program planning and proposal writing, and strategic 

business planning. In order to ensure the sustained and successful 

operation and expansion of the health centers program, the committee expects the collaborative technical assistance program, and 

the funding provided in support of it, to be continued and expanded. 

Proportional funding allocation 

The committee continues the statutory funding allocation requirement for the Community Health, Migrant, Homeless, and 

Public Housing sub authorities under section 330. The committee 

restored this funding allocation requirement in P.L. 107–251, enacted in 2002. The committee notes that when the four separate 

health center programs were consolidated under a single section 

330 authority in 1996, the law included a requirement for allocating funds appropriated under section 330 for each of the sub authorities in accordance with the proportion of total funding they 

each received in Fiscal Year 1996. The committee recognizes that 

despite the expiration of this statutory funding allocation requirement in 1998, the Secretary has continued to adhere to the proportional allocation methodology in distributing overall health centers 

program funding among the four health center programs sub authorities, thus enabling health center programs to provide needed 

services to vulnerable, hard to reach ‘‘special populations’’ such as 

homeless individuals, residents of public housing projects, and migrant and seasonal farmworkers. These programs should be continued and expanded in accordance with the funding allocation methVerDate Aug 31 2005 05:42 Mar 14, 2008 Jkt 069010 PO 00000 Frm 00017 Fmt 6659 Sfmt 6602 E:\HR\OC\SR274.XXX SR274

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odology in the statute. The committee commends the Secretary for 

continuing to allocate the same percentage each fiscal year as was 

allocated the previous years. The committee encourages HRSA to 

expand and enhance the provision of technical assistance to promote high quality applications for funding to serve special populations as well as sparsely populated communities. 

Importance of health center owned and controlled networks 

Health centers currently collaborate with each other and with 

other community providers, in many different forms of networks 

and partnerships designed to improve operational quality, efficiency, and effectiveness. These collaborations include managed 

care, integrated service, and practice management networks, which 

are designed to improve quality of care through shared expertise 

(such as shared electronic medical records systems, centralized 

pharmaceutical or laboratory services, clinical outcomes management, and/or joint management/ administrative services), to lower 

costs through shared services (such as unified financial or Management Information systems, or joint purchasing of services or supplies), or to improve access and availability of health care services. 

Today, nearly 200 health centers are involved in approximately 20 

local and regional operational networks across a majority of States, 

each designed to lower costs and improve care. These networks 

have played a central role in the adoption, integration and maintenance of Health Information Technology (HIT), including Electronic 

Health Records (EHR) at and among health centers nationwide. 

Most of these networks, once developed, need ongoing operational 

support to continue and further enhance their benefits. The committee supports the continued use of these public-private partnerships to assist with the provision of health care services, and encourages the Secretary to continue allocating a portion of an increase in appropriated funds towards this purpose. 

Expanding access through the Health Centers program 

The committee supports continued efforts to expand the Health 

Centers program into medically underserved communities and populations with high poverty and no current access to a health center. 

The committee commends States that have made commitments to 

expanding access to Community Health Centers to all underserved 

areas throughout their States, and believes that these States 

should be given serious consideration when expansion opportunities are made available. 

NATIONAL HEALTH SERVICE CORPS

The committee recognizes the importance of reauthorizing the 

National Health Service Corps program to demonstrate our commitment to addressing the need to locate providers in medically underserved areas. The legislation increases the authorization level 

for the NHSC program as follows: 

$131,500,000 in fiscal year 2008; 

$143,335,000 in fiscal year 2009; 

$156,235,150 in fiscal year 2010; 

$170,296,310 in fiscal year 2011; and 

$185,622,980 in fiscal year 2012. 


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Automatic HPSA designation for community health centers and 

rural health clinics 

The committee revised the NHSC placement criteria during the 

last reauthorization in 2002. The amended statute extended Automatic HPSA facility status to health centers and rural health clinics, thus making them eligible for placement of NHSC personnel, 

in order to reduce bureaucratic barriers to allow coordinated use of 

Federal resources in meeting the health care needs of areas that 

lack sufficient providers and services. That action recognized that 

the NHSC, health centers, and rural health clinics programs are 

intended to address similar goals: to meet the primary care needs 

of underserved populations. 

The committee is striking language that placed a 6-year time 

limit on automatic Health Professional Shortage Area (HPSA) facility designations that were extended to Federally Qualified Health 

Centers (FQHCs) and Rural Health Clinics (RHCs). It is the committee’s intent that FQHCs and RHCs automatic HPSA designation continue. The committee notes that all FQHCs must by law be 

located in medically underserved areas as determined by the Secretary, and that both FQHCs and RHCs must compete with all applicants to obtain NHSC placements. Therefore, the committee has 

concluded that the 6-year limit is unnecessary. The committee also 

notes concern about the current HPSA scoring process and its effect on certain medically underserved communities. 

Inclusion of other health care providers 

Currently various types of primary care providers are funded 

through the NHSC scholarship and loan repayment programs. The 

committee recognizes that the intent of the NHSC program, as 

stated in statute, is to assure an adequate supply of primary care 

providers such as physicians, dentists, behavioral and mental 

health professionals, certified nurse midwives, certified nurse practitioners, and physicians assistants, and if needed by the Corps, 

other health professionals. The committee understands that these 

other practitioners provide first contact care for basic health services that are needed by most or all of the population. For the purposes of the Act, Section 338B National Health Service Corps Loan 

Repayment Program, the term ‘‘other health professionals’’ is intended to include optometrists, pharmacists, chiropractors, and 

physical therapists. 

Frontier areas 

The health care challenges facing rural America are magnified in 

the Nation’s frontier. Frontier communities often do not have adequate access to health care providers. Their populations must travel for an excessive time or across a great distance to see a doctor, 

dentist, or counselor. Even when frontier communities have local 

access to health care, they are frequently underserved. Moreover, 

frontier communities may fail to be designated as HPSA because 

the population-to-provider ratio used can overestimate a frontier 

population’s access to health care. There are two reasons for this 

problem. First, frontier communities are sparsely populated. Low 

population communities can exceed the 3000-to-1 threshold with a 

single health provider. Second, the population-to-provider ratio ignores the extra strain that geographic isolation imposes on health 


bajohnson on PROD1PC77 with REPORTS
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19 Journal of the American Medical Association Sept 7, 2005; Vol 294, No 9. 

care providers. For example, a frontier area with a population of 

4,000 may be served by only a few healthcare providers. With the 

nearest hospital an hour long drive or more away, these few providers may need to work long hours every day of the week to provide critical emergency care in addition to basic health care. 

The committee recommends that HRSA consider the challenges 

faced by frontier areas in the HPSA scoring process. The committee 

also encourages HRSA to consider incorporating other factors into 

the HPSA scoring process, such as the travel time and/or distance 

frontier residents have to travel to reach the nearest health care 

center. Consideration of these factors may more accurately reflect 

a frontier community’s true access to health care. 

Professional development 

The Public Health Service Act is amended in two places to include an increased emphasis on professional development and 

training for Corps members. Section 333 amends the assignment of 

Health Professional Shortage Areas to include language indicating 

that the entity demonstrate a willingness to support or facilitate 

mentorship, professional development, and training opportunities 

for Corps members. Section 336, subsection d is amended to include 

a section on professional development and training. 

More than 3,000 Health Professional Shortage Areas have been 

designated in our country, and approximately 56 million people live 

in communities without access to health care. The National Health 

Service Corps program was developed to help assign Federal personnel to these shortage areas. It was later expanded to provide 

scholarships to health professionals who then provided service to 

underserved communities. Currently, there are more than 4,000 

health care professionals serving with the National Health Service 

Corps and providing care to communities that lack adequate access 

to primary care. However, there is still enormous unmet need in 

the program, with more sites that request health professionals 

than there are enrollees in the program. 

Part of this shortage is due to the lack of funding for the program; part of this shortage is due to changes in the number of 

health professionals choosing careers in primary care. From 1995 

to 2005, the number of medical school graduates entering family 

medicine training programs dropped by double digits.19 In addition, 

there are shortages of faculty needed to train other primary care 

providers, like nurse practitioners. As a result, the National Health 

Service Corps is facing competition for an increasingly limited pool 

of health professionals. 

While the National Health Service Corps provides scholarships 

and loan repayment opportunities, in this reauthorization, the committee sought to increase the incentives to help with recruitment 

and retention of primary care providers. The reauthorization contains language to expand the types of professional development opportunities available to enrollees, including expanding the professional and support networks among enrollees, and encouraging increased use of distance learning opportunities. In addition, the reauthorization requires entities seeking NHSC enrollees to demonstrate willingness to support professional development and trainVerDate Aug 31 2005 05:42 Mar 14, 2008 Jkt 069010 PO 00000 Frm 00020 Fmt 6659 Sfmt 6602 E:\HR\OC\SR274.XXX SR274

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ing opportunities. With this expansion, the committee believes that 

NHSC members will have added benefits that may help to increase 

recruitment and retention. 

V. COST ESTIMATE

U.S. CONGRESS, CONGRESSIONAL BUDGET OFFICE, Washington, DC, March 11, 2008. 

Hon. EDWARD M. KENNEDY, Chairman, 

Committee on Health, Education, Labor, and Pensions, 

U.S. Senate, Washington, DC. 

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for S. 901, the Health Care Safety 

Net Act of 2007. 

If you wish further details on this estimate, we will be pleased 

to provide them. The CBO staff contact is Lara Robillard. 

Sincerely, 

ROBERT A. SUNSHINE

(For Peter R. Orszag, Director). 

Enclosure. 

S. 901—Health Care Safety Net Act of 2007 

Summary: S. 901 would amend the Public Health Service Act to 

authorize programs that provide funding for community health centers, the National Health Service Corps, and certain rural health 

programs administered by the Health Resources and Services Administration. 

The bill would authorize the appropriation of $2.4 billion for 

2008 and $15.1 billion over the 2008–2012 period. However, $2.2 

billion has already been appropriated for those activities for 2008. 

Thus, S. 901 would authorize the appropriation of an additional 

$0.2 billion for fiscal year 2008 and $12.9 billion over the 2008–

2012 period. 

CBO estimates that implementing the bill would cost $94 million 

in 2008, $1.5 billion in 2009, and $12.5 billion over the 2008–2013 

period, assuming the appropriation of the authorized amounts. S. 

901 would not affect direct spending or revenues. 

S. 901 contains no intergovernmental or private-sector mandates 

as defined in the Unfunded Mandates Reform Act (UMRA) and 

would impose no costs on state, local, or tribal governments. 

Estimated cost to the Federal Government: The estimated budgetary impact of S. 901 is shown in the following table. The costs 

of this legislation fall within budget function 550 (health). 

By fiscal year, in millions of dollars— 

2008 2009 2010 2011 2012 2013 

SPENDING SUBJECT TO APPROPRIATION 

Spending Under Current Law: 

Community Health Centers: 

Budget Authority ..................................................................... 2,022 0 0 0 0 0 

Estimated Outlays .................................................................. 2,035 989 231 0 0 0 

National Health Service Corps: 

Budget Authority ..................................................................... 123 0 0 0 0 0 

Estimated Outlays .................................................................. 122 62 10 0 0 0 


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By fiscal year, in millions of dollars—

2008 2009 2010 2011 2012 2013 

Rural Health Outreach Grants: 

Budget Authority ..................................................................... 48 0 0 0 0 0 

Estimated Outlays .................................................................. 47 20 2 0 0 0 

Total: 

Budget Authority ..................................................................... 2,193 0 0 0 0 0 

Estimated Outlays .................................................................. 2,204 1,071 243 0 0 0 

Proposed Changes: 

Community Health Centers: 

Authorization Level ................................................................. 191 2,451 2,758 3,116 3,537 0 

Estimated Outlays .................................................................. 90 1,383 2,505 2,883 3,266 1,579 

National Health Service Corps: 

Authorization Level ................................................................. 8 143 156 170 186 0 

Estimated Outlays .................................................................. 4 79 144 160 175 83 

Rural Health Outreach Grants: 

Authorization Level ................................................................. 0 45 45 45 45 0 

Estimated Outlays .................................................................. 0 24 43 44 44 20 

Total Changes: 

Authorization Level ................................................................. 199 2,639 2,959 3,331 3,768 0 

Estimated Outlays .................................................................. 94 1,486 2,692 3,087 3,485 1,682 

Estimated Spending Under S. 901: 

Community Health Centers: 

Authorization Level ................................................................. 2,213 2,451 2,758 3,116 3,537 0 

Estimated Outlays .................................................................. 2,125 2,372 2,736 2,883 3,266 1,579 

National Health Service Corps: 

Authorization Level ................................................................. 131 143 156 170 186 0 

Estimated Outlays .................................................................. 126 141 154 160 175 83 

Rural Health Outreach Grants: 

Authorization Level ................................................................. 48 45 45 45 45 0 

Estimated Outlays .................................................................. 47 44 45 44 44 20 

Total Spending: 

Authorization Level ................................................................. 2,392 2,639 2,959 3,331 3,768 0 

Estimated Outlays .................................................................. 2,298 2,557 2,935 3,087 3,485 1,682 

Note: Components may not add to totals because of rounding. 

Basis of estimate: S. 901 would authorize three programs that 

provide funding for health programs in rural and medically underserved areas. In total, the bill would authorize the appropriation of 

$2.4 billion for 2008 and $15.1 billion over the 2008–2012 period. 

The Omnibus Appropriations Act (Public Law 110–161) appro- priated $2.2 billion in 2008 for those activities. Thus, S. 901 would 

authorize the appropriation of an additional $199 million for fiscal 

year 2008 and $12.9 billion over the 2008–2012 period. 

Based on historical patterns of spending for those programs, and 

assuming the appropriation of the authorized amounts, CBO estimates that implementing the bill would cost $94 million in 2008, 

$1.5 billion in 2009, and $12.5 billion over the 2008–2013 period. 

Community health centers are community-based and patient-directed organizations that serve populations with limited access to 

primary health care services. S. 901 would authorize the appropriation of $2.2 billion for 2008 (an increase of $191 million over the 

current appropriation), and $11.9 billion over the 2009–2012 period. Assuming the appropriation of the additional funds for 2008 

in the spring, and the appropriation of the authorized amounts in 

subsequent years, CBO estimates that spending for the community 

health center program from the funds authorized by this bill would 

total $90 million in 2008 and $11.7 billion over the 2008–2013 period. 

The National Health Service Corps operates loan repayment and 

scholarship programs for clinicians who provide primary care services in medically underserved areas. S. 901 would authorize the apVerDate Aug 31 2005 05:42 Mar 14, 2008 Jkt 069010 PO 00000 Frm 00022 Fmt 6659 Sfmt 6602 E:\HR\OC\SR274.XXX SR274

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propriation of $132 million for 2008 (an increase of $8 million over 

the current appropriation), and $655 million over the 2009–2012 

period. Assuming the appropriation of the additional funds for 2008 

in the spring, and the appropriation of the authorized amounts in 

subsequent years, CBO estimates that spending for the National 

Health Service Corps program from the funds authorized by this 

bill would total $4 million in 2008 and $645 million over the 2008–

2013 period. 

The rural health care services outreach, network and quality improvement program provides grants for activities to increase access 

to primary health care services in rural areas; help rural health 

care providers develop community-based, integrated systems of 

care; and improve the quality of health care for certain chronic diseases. The bill would authorize the appropriation of $45 million a 

year for fiscal years 2008 through 2012. The amount authorized for 

2008 is less than the $48 million appropriated for 2008. Therefore, 

the estimate assumes that enacting S. 901 would have no effect on 

funding for 2008. Assuming the appropriation of the amounts authorized for fiscal years 2009 through 2012, CBO estimates that 

spending for rural health outreach grants from the funds authorized by this bill would total $175 million over the 2008–2013 period. 

Intergovernmental and private-sector impact: S. 901 contains no 

intergovernmental or private-sector mandates as defined in UMRA. 

Funds authorized in the bill would benefit local governments that 

participate in community and rural health programs. 

Estimate prepared by: Federal Costs: Lara Robillard; Impact on 

State, Local, and Tribal Governments: Lisa Ramirez-Branum; Impact on the Private Sector: Patrick Bernhardt. 

Estimate approved by: Keith J. Fontenot, Deputy Assistant Director for Health and Human Resources, Budget Analysis Division. 

VI. REGULATORY IMPACT STATEMENT

The committee has determined that there is no legislative impact. 

VII. APPLICATION OF LAW TO THE LEGISLATIVE BRANCH

The committee has determined that there will be minimal increases in the regulatory burden imposed by this bill. 

VIII. SECTION-BY-SECTION ANALYSIS

Section 1. Short title 

Section 1 provides the short title of the bill, the ‘‘Health Care 

Safety Net Act of 2007.’’

Section 2. Community Health Centers Program of the Public Health 

Service Act 

Section 2 part (a) amends section 330(r) of the Public Health 

Service Act to increase the authorization levels for the Health Centers Program for Fiscal Year 2008–2012. 

Part (b) includes several studies relating to community health 

centers. 


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24 

Subsection 1 includes definitions of the terms ‘‘community health 

center’’ and ‘‘medically underserved.’’

Subsection 2 describes a school based health center study to be 

conducted by the Comptroller General of the United States. No 

later than 2 years after the enactment of the act, the GAO shall 

study the economic costs and benefits of school based health centers and the impact on the health of students served by these centers. The study would analyze the impact of Federal funding on the 

operation of school based health centers, any cost savings to other 

Federal programs derived from providing services in these centers, 

the potential impact on the Federal budget and the health of students, and the impact on access to health care in rural or underserved areas. 

Subsection 3 describes a health care quality study to be conducted by the Agency for Healthcare Research and Quality 

(AHRQ). This study would describe AHRQ’s efforts to expand and 

accelerate quality improvement activities in community health centers, including Federal efforts towards improved healthcare quality, 

identification of effective models for quality improvement, and efforts to determine how effective quality improvement models may 

be adapted for implementation by CHCs with varying characteristics such as size, budget, staffing etc. This section also directs the 

Administrator of HRSA to establish a formal mechanism for the ongoing dissemination of agency initiatives, best practices, and other 

information that may assist health care quality improvement efforts. 

Subsection 4 describes a study to be conducted by the GAO on 

an integrated health systems model for the delivery of health care 

services to medically underserved populations. This study, to be 

conducted at not more than 10 sites, would examine health care delivery models sponsored by public or nonprofit entities that integrate primary, specialty, and acute care and serve medically underserved populations in rural or urban areas. The report would evaluate the model’s ability to expand access to primary and preventive 

services for medically underserved populations, improve care coordination and health care outcomes, while also assessing the challenges in providing care to medically underserved populations, and 

the advantages and disadvantages of such health care delivery 

models compared to other such models. 

Section 3. National Health Service Corps 

Section 3 part (a) amends section 331 through 338G of the Public 

Health Service Act to increase the authorization levels for the National Health Service Corps program for Fiscal Years 2008–2012. 

Part (b) amends section 332(a)(1) of the Public Health Service 

Act to strike language that limited the automatic Health Professions Shortage Area designation for Community Health Centers 

and rural health programs to 6 years. The automatic HPSA designation will continue indefinitely. 

Part (c) amends section 333(a)(1)(D)(ii) of the Public Health Service Act on the assignment of personnel to HPSAs to include a new 

requirement that a site seeking a NHSC assignee must demonstrate a willingness to support mentorship, professional development, and training opportunities for Corps members. 


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Part (d) amends subsection (d) of section 336 of the Public Health 

Service Act to include a new section on professional development 

and training. This new language requires the Secretary to assist 

Corps members in establishing and maintaining professional relationships and development opportunities. In providing this assistance, the Secretary shall focus on establishing relationships with 

hospitals, academic medical centers, health professions schools, 

area health education centers, health education and training centers, and border health education and training centers. The Secretary shall also assist Corps members in obtaining faculty appointments at health professions schools. 

Section 4. Reauthorization of Rural Health Care Programs 

Section 4 amends section 330A(j) of the Public Health Service Act 

by increasing the authorization level for rural health care programs 

to $45 million for fiscal years 2008 through 2012. 

IX. CHANGES IN EXISTING LAW

In compliance with rule XXVI paragraph 12 of the Standing 

Rules of the Senate, the following provides a print of the statute 

or the part or section thereof to be amended or replaced (existing 

law proposed to be omitted is enclosed in black brackets, new matter is printed in italic, existing law in which no change is proposed 

is shown in roman): 

PUBLIC HEALTH SERVICE ACT 

* * * * * * * 

SEC. 330. ø254b¿ HEALTH CENTERS. 

(a) DEFINITION OF HEALTH CENTER.— (1) IN GENERAL.— * * * 

* * * * * * * 

(r) AUTHORIZATION OF APPROPRIATIONS.—

ø(1) IN GENERAL.—For the purpose of carrying out this section, in addition to the amounts authorized to be appropriated 

under subsection (d), there are authorized to be appropriated 

$1,340,000,000 for fiscal year 2002 and such sums as may be 

necessary for each of the fiscal years 2003 through 2006.¿ 

(1) In GENERAL.—For the purpose of carrying out this section, 

in addition to the amounts authorized to be appropriated under 

subsection (d), there are authorized to be appropriated—

(A) $2,213,020,000 for fiscal year 2008; 

(B) $2,451,394,400 for fiscal year 2009; 

(C) $2,757,818,700 for fiscal year 2010; 

(D) $3,116,335,131 for fiscal year 2011; and 

(E) $3,537,040,374 for fiscal year 2012. 

* * * * * * * 

SEC. 330A. ø254c¿ RURAL HEALTH CARE SERVICES OUTREACH, RURAL 

HEALTH NETWORK DEVELOPMENT, AND SMALL HEALTH 

CARE PROVIDER QUALITY IMPROVEMENT GRANT PROGRAMS. 

(a) PURPOSE.—* * * 

* * * * * * * 


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(j) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to 

be appropriated to carry out this section ø$40,000,000 for fiscal 

year 2002, and such sums as may be necessary for each of fiscal 

years 2003 through 2006.¿ $45,000,000, for each of fiscal years 

2008 through 2012. 

* * * * * * * 

SEC. 332. ø254e¿ (a)(1) For purposes of this subpart the term 

‘‘health professional shortage area’’ means (A) an area in an urban 

or rural area (which need not conform to the geographic boundaries 

of a political subdivision and which is a rational area for the delivery of health services) which the Secretary determines has a health 

manpower shortage, (B) a population group which the Secretary determines has such a shortage, or (C) a public or nonprofit private 

medical facility or other public facility which the Secretary determines has such a shortage. All Federally qualified health centers 

and rural health clinics, as defined in section 1861(aa) of the Social 

Security Act (42 U.S.C. 1395x(aa)), that meet the requirements of 

section 334 shall be automatically designated as having such a 

shortage. øNot earlier than 6 years after such date of designation, 

and every 6 years thereafter, each such center or clinic shall demonstrate that the center or clinic meets the applicable requirements 

of the Federal regulations regarding the definition of a health professional shortage area for purposes of this section.¿ The Secretary 

shall not remove an area from the areas determined to be health 

professional shortage areas under subparagraph (A) of the preceding sentence until the Secretary has afforded interested persons 

and groups in such area an opportunity to provide data and information in support of the designation as a health professional shortage area or a population group described in subparagraph (B) of 

such sentence or a facility described in subparagraph (C) of such 

sentence, and has made a determination on the basis of the data 

and information submitted by such persons and groups and other 

data and information available to the Secretary. 

* * * * * * * 

SEC. 333. ø254f¿ (a)(1) * * * 

(A) * * * 

* * * * * * * 

(D) * * * 

(I) * * * 

* * * * * * * 

(IV) the area has made unsuccessful efforts to secure 

health manpower for the area; øand¿ 

(V) there is a reasonable prospect of sound fiscal management, including efficient collection of fee-for-service, 

third-party, and other appropriate funds, by the entity 

with respect to Corps members assigned to such entityø.¿; 

and 

(VI) the entity demonstrates willingness to support or facilitate mentorship, professional development, and training 

opportunities for Corps members. 

* * * * * * * 


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SEC. 336. ø254h–1¿ FACILITATION OF EFFECTIVE PROVISION OF CORPS 

SERVICES. 

(a) CONSIDERATION OF INDIVIDUAL CHARACTERISTICS OF MEMBERS IN MAKING ASSIGNMENTS.—* * * 

* * * * * * * 

ø(d) ASSISTANCE IN ESTABLISHING LOCAL PROFESSIONAL RELATIONSHIPS.—The Secretary shall assist Corps members in establishing appropriate professional relationships between the Corps 

member involved and the health professions community of the geographic area with respect to which the member is assigned, including such relationships with hospitals, with health professions 

schools, with area health education centers under section 781, with 

health education and training centers under such section, and with 

border health education and training centers under such section. 

Such assistance shall include assistance in obtaining faculty appointments at health professions schools.¿ 

(d) PROFESSIONAL DEVELOPMENT AND TRAINING.—

(1) IN GENERAL.—The Secretary shall assist Corps members 

in establishing and maintaining professional relationships and 

development opportunities, including by—

(A) establishing appropriate professional relationships 

between the Corps member involved and the health professions community of the geographic area with respect to 

which the member is assigned; 

(B) establishing professional development, training, and 

mentorship linkages between the Corps member involved 

and the larger health professions community, including 

through distance learning, direct mentorship, and development and implementation of training modules designed to 

meet the educational needs of offsite Corps members; 

(C) establishing professional networks among Corps 

members; or 

(D) engaging in other professional development, 

mentorship, and training activities for Corps members, at 

the discretion of the Secretary. 

(2) ASSISTANCE IN ESTABLISHING PROFESSIONAL RELATIONSHIPS.—In providing such assistance under paragraph (1), the 

Secretary shall focus on establishing relationships with hospitals, with academic medical centers and health professions 

schools, with area health education centers under section 751, 

with health education and training centers under section 752, 

and with border health education and training centers under 

such section 752. Such assistance shall include assistance in 

obtaining faculty appointments at health professions schools. 

(3) SUPPLEMENT NOT SUPPLANT.—Such efforts under this subsection shall supplement, not supplant, non-government efforts 

by professional health provider societies to establish and maintain professional relationships and development opportunities. 

SEC. 338. ø254k¿ (a) For the purpose of carrying out this subpart, there are authorized to be appropriated such sums as may be 

necessary for each of the fiscal years ø2002 through 2006¿ 2008 

through 2012. 

* * * * * * * 


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SEC. 338H. ø254q¿ AUTHORIZATION OF APPROPRIATIONS. 

(a) AUTHORIZATION OF APPROPRIATIONS.—For the purposes of carrying out this subpart, there are authorized to be øappropriated 

$146,250,000 for fiscal year 2002, and such sums as may be necessary for each of fiscal years 2003 through 2006.¿ appropriated—

(1) for fiscal year 2008, $131,500,000; 

(2) for fiscal year 2009, $143,335,000; 

(3) for fiscal year 2010, $156,235,150; 

(4) for fiscal year 2011, $170,296,310; and 

(5) for fiscal year 2012, $185,622,980. 

* * * * * * * 

Amend the title so as to read: A bill to amend the Public Health 

Service Act to reauthorize the Community Health Centers program, the National Health Service Corps, and rural health care 

programs. 

Æ 


bajohnson on PROD1PC77 with REPORTS