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[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[S. 2109 Introduced in Senate (IS)]

103d CONGRESS
  2d Session
                                S. 2109

 To amend the Public Health Service Act and the Social Security Act to 
 provide improved and expanded access to comprehensive primary health 
  care and related services for medically underserved and vulnerable 
    populations through the provision of financial support for the 
  development of community-based health networks and plans, to permit 
federally-assisted health centers to expand their capacity and develop 
and operate new sites to serve underserved and vulnerable populations, 
 to provide certain financial and other protections for such networks, 
 plans, and health centers, and to facilitate the involvement of, and 
payment to, entities serving underserved and vulnerable populations in 
 the training and education of primary care health professionals, and 
                          for other purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                 May 12 (legislative day, May 2), 1994

  Mr. Hollings (for himself, Mrs. Murray, Mr. Boren, Mr. Cochran, Ms. 
Mikulski, Mr. Inouye, Mr. Hatch, and Ms. Moseley-Braun) introduced the 
             following bill; which was read the first time

_______________________________________________________________________

                                 A BILL

 
 To amend the Public Health Service Act and the Social Security Act to 
 provide improved and expanded access to comprehensive primary health 
  care and related services for medically underserved and vulnerable 
    populations through the provision of financial support for the 
  development of community-based health networks and plans, to permit 
federally-assisted health centers to expand their capacity and develop 
and operate new sites to serve underserved and vulnerable populations, 
 to provide certain financial and other protections for such networks, 
 plans, and health centers, and to facilitate the involvement of, and 
payment to, entities serving underserved and vulnerable populations in 
 the training and education of primary care health professionals, and 
                          for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; FINDINGS.

    (a) Short Title.--This Act may be cited as the ``Access to 
Community Health Care Act of 1994''.
    (b) Findings.--Congress finds the following:
            (1) Efforts to assure universal coverage for comprehensive 
        health care benefits are a vitally important part of achieving 
        effective national health care reform.
            (2) The provision of universal insurance coverage, while 
        vitally important, will not alone address the critical needs of 
        the estimated 43,000,000 Americans who are underserved by the 
        current health care system, and who lack access to the most 
        basic health services.
            (3) Access to, and coordination of, health care is 
        especially difficult for those Americans who live in 
        underserved rural and inner-city communities or who are members 
        of other vulnerable groups, including migratory and seasonal 
        agricultural workers, persons who are homeless, those with HlV 
        infection, those who suffer from substance addiction, high-risk 
        pregnant women, infants and children, immigrants and refugees, 
        and individuals with disabilities.
            (4) The consequences of poor access to, and lack of 
        coordination of, health care among the underserved is evidenced 
        by elevated infant and childhood illness and mortality rates, 
        over-utilization of emergency rooms and other inappropriate 
        providers for primary care services, and hospitalization rates 
        for preventable conditions that are significantly higher than 
        the national average.
            (5) Efforts to provide increased access to, and coordinate 
        the delivery of, vital primary health care and related services 
        for underserved and vulnerable Americans will not only 
        contribute to improved health status, but will also reduce 
        unnecessary care and the overall costs of health care.
            (6) Essential community providers, such as the community 
        and migrant health centers, collectively referred to as health 
        centers, which serve more than 7,000,000 needy Americans, 
        provide an effective and proven model for extending access to 
        all underserved and vulnerable Americans.
            (7) Support for the development and operation of new and 
        expanded sites served by the health centers and similar primary 
        health care providers, is needed to extend access to 
        comprehensive primary health care services for the millions of 
        Americans who remain unserved or underserved.
            (8) As managed care has achieved recognition as a means of 
        organizing and paying for health care for many Americans, there 
        is a need to assure that such arrangements develop in a manner 
        that is responsive to the needs of underserved people and 
        communities. Of particular importance is the development of 
        community-based networks of health centers and other essential 
        community providers that offer high quality care to individuals 
        and that endeavor to both contain costs and reduce unnecessary 
        or inappropriate uses of high-cost services.
            (9) Essential community providers such as health centers 
        and community-based networks serving such populations must be 
        afforded certain protections from full financial risk for the 
        cost of serving such populations and communities. Protections 
        are needed because underserved populations typically require 
        more frequent and intensive care, and because reduced use of 
        higher-cost inpatient, emergency and specialty care will depend 
        on the increased provision of primary care as well as related 
        and enabling services.
            (10) Health centers and community-based networks that 
        participate in arrangements which produce savings of grant 
        funds or increased revenues that will be used to further expand 
        or improve services to medically underserved populations should 
        be afforded protection from anti-kickback laws.
            (11) Health centers, community-based networks and other 
        essential community providers of comprehensive primary care 
        services to the underserved provide the most appropriate 
        locations and conditions for educating and training primary 
        health care professionals, and should be centrally involved in 
        such education and training efforts.

SEC. 2. GRANTS FOR THE DEVELOPMENT AND OPERATION OF HEALTH CENTERS AND 
              COMMUNITY HEALTH NETWORKS AND HEALTH PLANS.

    (a) Services Authorized at Schools and Other Appropriate 
Locations.--Section 330(a) of the Public Health Service Act (42 U.S.C. 
254c(a)) is amended by inserting after ``provides'' the following: ``at 
appropriate locations, that may include schools and other sites''.
    (b) Enabling and Outreach Services.--Section 330(a) of such Act (42 
U.S.C. 254c(a)) (as amended by subsection (a)), is further amended--
            (1) in paragraph (5), by striking ``and'' at the end 
        thereof;
            (2) in paragraph (6)--
                    (A) by inserting ``the services of outreach workers 
                and others to determine, or assist in determining, the 
                eligibility of individuals to receive services and 
                benefits under Federal, State and local health 
                programs, and to assist such individuals in enrolling 
                in such programs, and other'' before ``patient case''; 
                and
                    (B) by adding ``and'' at the end thereof; and
            (3) by inserting after paragraph (6) the following new 
        paragraph:
            ``(7) enabling services (defined as those services that are 
        not otherwise described in this subsection) that promote access 
        to necessary health and other human and social services, and 
        that increase the capacity of individuals to utilize the items 
        and services included as covered benefits under Federal, State, 
        and local health programs;''.
    (c) Community Health Service Networks and Plans.--Section 330 of 
such Act (42 U.S.C. 254c) is amended by adding at the end thereof the 
following subsection:
    ``(l)(1) The Secretary may make a grant to one or more community 
health centers that receive grants under subsection (d)(l)(A), or to 
one or more federally qualified health centers as defined in Section 
1861(aa)(4) of the Social Security Act, to support the development of a 
community health service network or plan as defined in paragraph (3). 
Assistance received under a grant under this subsection may be used to 
pay for the--
            ``(A) cost associated with the development of the network 
        or plan as a corporate entity, including planning and needs 
        assessments, and the cost associated with the development of 
        appropriate contractual agreements between the participating 
        providers and the network or plan;
            ``(B) cost associated with the development of the internal 
        management for the network or plan, as well as the cost 
        associated with the development of financial, legal, clinical, 
        information systems (exclusive of systems that the Secretary 
        determines are information highways), billing and reporting 
        systems for the network or plan;
            ``(C) cost associated with the development of additional 
        sites that will assure or enhance the provision and 
        accessibility of primary health care and enabling services to 
        medically underserved populations, and residents of health 
        professional shortage areas;
            ``(D) cost associated with the recruitment, training, and 
        compensation of health professionals and administrative staff;
            ``(E) acquisition, expansion, modernization of facilities, 
        conversion of unneeded hospital facilities to facilities that 
        will assure or enhance the provision and accessibility of 
        primary health care and enabling services, as well as 
        construction of new facilities and purchase of major equipment 
        (including equipment necessary for support of external and 
        internal information systems);
            ``(F) amount of any reserves that are required for 
        furnishing services on a prepaid basis; and
            ``(G) such other costs as are necessary to assure that the 
        network or plan will be ready to assume operational status by 
        the end of the planning and development phase.
    ``(2) The Secretary may make grants to support the operation of 
community health service networks or plans that received assistance 
under paragraph (1) for planning and development and that meet the 
requirements of subparagraphs (A) and (B) of paragraph (3). The costs 
for which a grant may be made include, the costs described in paragraph 
(1), and the otherwise unreimbursed costs of furnishing services 
described in subsection (a) (except for the costs of inpatient hospital 
services, extended care facility services and long-term physical 
medicine) to medically underserved populations and residents of health 
professional shortage areas and other hard-to-reach populations.
    ``(3)(A) For purposes of this section:
            ``(i) The term `community health service network' means a 
        consortium of health care providers that meets the following 
        requirements:
                    ``(I) The consortium is a public or nonprofit 
                private entity whose principal purpose is, with respect 
                to the items and services that are described in 
                subsection (a), to provide all or a portion of such 
                items and services to a significant number of 
                individuals who are members of a medically underserved 
                population or populations, residents of health 
                professional shortage areas and other hard-to-reach 
                populations in the network service area.
                    ``(II) The participation of health care providers 
                in the consortium is governed by a written agreement to 
                which each of the participating providers is a party.
            ``(ii) The term `community health service plan' means a 
        health plan that meets the following conditions:
                    ``(I) The health plan is a public or nonprofit 
                private entity, as defined in section 1903(m)(2)(A) of 
                the Social Security Act, whose principal purpose is, 
                with respect to the items and services that are 
                described in subsection (a), to provide all or a 
                portion of the items and services to a significant 
                number of individuals who are members of a medically 
                underserved population or populations, residents of 
                health professional shortage areas in the plan's 
                service area, and other hard-to-reach populations in 
                the plan's service area.
                    ``(II) The participation of health care providers 
                in the health plan is governed by a written agreement 
                to which each of the participating providers is a 
                party.
    ``(B) A community health service network or plan shall--
            ``(i) be governed by individuals a majority of whom are 
        registered patients of the network or plan or are 
        representatives of the entities described in clause (iv)(I), or 
        a combination of such individuals;
            ``(ii) assure the provision of services through 
        participating providers (who may provide services directly or 
        through contract) in accordance with all of the requirements of 
        subsection (e)(3) except subparagraph (G);
            ``(iii) be reasonable in size to accomplish the objectives 
        of this subsection;
            ``(iv) include as participating providers (unless such 
        provider(s) decline to participate)--
                    ``(I) at a minimum, all entities providing health 
                services under grants under this section or sections 
                329 or 340, and other federally qualified health 
                centers certified in accordance with section 
                1861(aa)(4) of the Social Security Act in the service 
                area of the plan or network;
                    ``(II) a reasonable number and combination (to 
                ensure that services will be comprehensive and 
                accessible) of--
                            ``(aa) public or nonprofit private entities 
                        that are entities providing health services 
                        under grants under sections 340A, 1001 or title 
                        XXIII, title V of the Social Security Act, 
                        title V of the Indian Health Care Improvement 
                        Act, and the Indian Self-Determination Act;
                            ``(bb) rural health clinics certified in 
                        accordance with Section 1861 (aa)(2) of the 
                        Social Security Act; and
                            ``(cc) local and State public health 
                        agencies;
                that collectively provide primary health and enabling 
                services to residents of the network or plan service 
                area; and
                    ``(III) at the option of the network or plan, any 
                other public or private entity that provides primary 
                health, enabling services or supplemental health 
                services to the population served by the network or 
                plan; and
            ``(v) ensure that each participating provider agrees to 
        provide services regardless of an individual's ability to pay.
    ``(4)(A) No grant may be made under paragraphs (1) or (2) unless an 
application therefore is submitted to, and approved by, the Secretary. 
Such an application shall be submitted in such form and manner and 
shall contain such information as the Secretary shall prescribe, 
including--
            ``(i) with respect to applications for planning and 
        development, the information required by subsection (c)(4) and 
        a demonstration of how the applicant will meet all requirements 
        of paragraph (3) by the end of the period of support under 
        paragraph (1); and
            ``(ii) with respect to applications for operations, the 
        information required by subsection (e).
    ``(B) In evaluating applications submitted under subparagraph (A), 
the Secretary shall consider--
            ``(i) the extent to which the applicant proposes to provide 
        or expand the provision of services described in subsection (a) 
        in a manner that is coordinated and assures accessibility of 
        service to medically underserved populations and health 
        professional shortage areas and which will otherwise meet the 
        requirements of paragraph (3) when the network or plan assumes 
        operational status;
            ``(ii) the relative need of the populations and areas 
        proposed to be served for the services proposed to be provided;
            ``(iii) whether the proposed network or plan described in 
        the application is reasonable in size and capacity;
            ``(iv) whether the proposed network or plan will address 
        such other needs of the medically underserved population or 
        populations and health professional shortage areas to be served 
        as the applicant or the Secretary may identify;
            ``(v) evidence of State and local support for the network 
        or plan; and
            ``(vi) whether the proposed budget to support the network 
        or plan, is reasonable and justified, taking into account other 
        sources of support for the proposed network or plan and 
        considering whether levels of support previously received from 
        other sources have been maintained.
    ``(5) Not more than two grants may be made under this subsection 
for planning and developing the same network or plan.''.
    (d) Flexible Authority.--Section 330 of such Act (42 U.S.C. 254c) 
(as amended by subsection (c)) is further amended by adding at the end 
thereof the following new subsection:
    ``(m)(1) The Secretary may make grants to public and nonprofit 
private entities that meet all of the requirements of subsection (l), 
except for paragraph (3)(B)(i) and such other requirements of that 
subsection as the Secretary may decide for good cause to waive, for the 
purpose of planning, developing and operating health networks and 
health plans as the Secretary determines will provide or enhance the 
provision and accessibility of the services that are described in 
subsection (a) to medically underserved populations and health 
professional shortage areas in the service area of the network or plan.
    ``(2) An application for a planning and development grant under 
paragraph (1) must meet the requirements of subsection (l)(4)(A)(i) and 
an application for an operations grant under paragraph (1) must meet 
the requirements of subsection (l)(4)(A)(ii).
    ``(3)(A) In evaluating applications submitted under paragraph (2), 
the Secretary will consider the factors described in subsection 
(l)(4)(B).
    ``(B) The Secretary may not approve an application for a grant 
under this subsection unless the Secretary determines that the network 
or plan involved will at a minimum assure significant community 
involvement. For purposes of this subsection, the term `significant 
community involvement' is demonstrated if the health network, or health 
plan--
            ``(i) is governed by a board of directors, at least one-
        third of the members of which are registered patients or 
        representatives of entities described in subsection 
        (l)(3)(B)(iv)(I), or a combination of such individuals; or
            ``(ii) has established a patient advisory council, composed 
        of representative registered patients of the network or plan, 
        through which registered patients are able to directly 
        participate in decisions that influence the character and 
        implementation of programs of the network or plan.
The Secretary shall give priority to applicants that meet the 
requirements of clause (i) over applicants that meet the requirements 
of clause (ii).
    ``(4) Not more than two grants may be made under this subsection 
for planning and developing the same health network or health plan.
    ``(5) Assistance received under a grant under paragraph (1) for the 
planning and development of a health network or health plan may be used 
to pay the costs described in subsection (l)(1). Assistance received 
under a grant under paragraph (1) for the operation of such a health 
network or health plan may be used to pay the costs described in 
subsection (l)(2).''.
    (e) Authorization of Appropriations.--
            (1) In general.--Section 330(g)(1)(A) of such Act (42 
        U.S.C. 254c(g)(1)(A)) is amended by striking ``$440,000,000'' 
        and all that follows through the end thereof and inserting the 
        following: ``$925,000,000 for fiscal year 1995, $1,425,000,000 
        for fiscal year 1996, $1,625,000,000 for fiscal year 1997, 
        $1,725,000,000 for fiscal year 1998, $1,725,000,000 for fiscal 
        year 1999, $1,725,000,000 for fiscal year 2000, and not less 
        than $1,725,000,000 for each of the fiscal years 2001 through 
        2005. The preceding sentence constitutes budget authority in 
        advance of appropriations acts and represents the obligation of 
        the Federal government to provide funding for payments in the 
        amounts, and for the fiscal years specified under this section. 
        Such levels shall not be subject to offset or reprogramming for 
        any reason.''.
            (2) Planning and operating health networks and plans.--
        Section 330(g)(1) of such Act (42 U.S.C. 254c(g)(1)) is amended 
        by adding at the end thereof the following new subparagraph:
    ``(C)(i) For the purpose of making grants for activities authorized 
under subsection (m), the Secretary may expend an amount not to exceed 
15 percent of the amount appropriated under subparagraph (A) for any 
fiscal year that is in excess of $625,000,000. The authority of the 
Secretary to make grants for such activities is effective for any 
fiscal year only to such extent or in such amounts exceeding 
$625,000,000 as are provided for in appropriation Acts.
    ``(ii) For the purpose of making grants under subsections (c) and 
(d) the Secretary shall expend not less than $625,000,000 for each 
fiscal year.
    ``(iii) In determining the level of funding to set aside for grants 
under subsections (c) and (d) in excess of $625,000,000, the Secretary 
shall increase such amount by such sums as are necessary to ensure that 
individual recipients of grants under such subsections have funding 
each fiscal year in amounts adequate to--
            ``(I) repay loans that have been made to such recipients 
        under Farmers Home Administration programs, under section 330A 
        of this Act, or under any other Federal program, or any other 
        loans with respect to which the Secretary has authorized the 
        use of funds budgeted in accordance with this section for 
        repayment; and
            ``(II) to cover the full cost of providing all primary 
        health care, enabling services, and appropriate supplemental 
        health services.''.
    (f) Funding Preferences.--Section 330(k) of such Act (42 U.S.C. 
254c(k)) is amended--
            (1) by inserting ``(1)'' after the subsection designation; 
        and
            (2) by adding at the end thereof the following new 
        paragraph:
    ``(2) In making grants under this section, the Secretary shall give 
preference as follows:
            ``(A) As between an application for a grant under 
        subsection (l) to plan, develop, or operate a community health 
        service network or plan and an application for a grant under 
        subsection (m) to plan, develop, or operate a health network or 
        plan serving the same medically underserved population, the 
        Secretary shall give preference to the applicant that is or 
        will be a community health service plan or network in 
        accordance with subsection (l).
            ``(B) As between two or more applications under subsection 
        (m) to serve the same medically underserved population, 
        preference shall be given to applicants that include as 
        participating providers the greatest number of entities 
        providing health services under grants under section 329, this 
        section and section 340.''.
    (g) Miscellaneous and Conforming Amendments.--
            (1) Application.--Section 330(c) of such Act (42 U.S.C. 
        254c(c)) is amended--
                    (A) in paragraph (1)--
                            (i) in the matter preceding subparagraph 
                        (A), by striking ``loans) and shall include--'' 
                        and inserting a period; and
                            (ii) by striking subparagraphs (A) through 
                        (D); and
                    (B) by adding at the end thereof the following new 
                paragraph:
    ``(4) No grant may be made under paragraph (1) unless an 
application therefor is submitted to and approved by, the Secretary. 
Such an application shall be submitted in such form and manner and 
contain such information as the Secretary may prescribe, and shall 
include--
            ``(A) an assessment of the need that the population 
        proposed to be served by the community health center for which 
        the project is undertaken has for enabling services, primary 
        health services, supplemental health services, and 
        environmental health services;
            ``(B) the design of a community health center program for 
        such population based on such assessment;
            ``(C) efforts to secure, within the proposed catchment area 
        of such center, financial and professional assistance and 
        support for the project; and
            ``(D) initiation and encouragement of continuing community 
        involvement in the development and operation of the project.''.
            (2) Demonstration of support.--
                    (A) Section 330(e)(2) of such Act (42 U.S.C. 
                254c(e)(2)) is amended--
                            (i) in the first sentence, by striking 
                        ``subparagraph (A) or (B) of'';
                            (ii) in the first sentence, by striking 
                        ``for a community health center'' and all that 
                        follows through ``Such an application shall 
                        also'' in the second sentence and inserting 
                        ``shall''; and
                            (iii) by adding at the end thereof the 
                        following new sentence: ``An application for a 
                        grant under subparagraph (B) of subsection 
                        (d)(1) must demonstrate how the entity will 
                        meet all of the requirements of subsection 
                        (e)(3) by the end of the period of support 
                        under such subsection.''.
                    (B) Section 330(e)(3) of such Act (42 U.S.C. 
                254c(e)(3)) is amended by adding at the end thereof the 
                following new sentence: ``The Secretary may not approve 
                an application under subsection (d)(1)(B) unless the 
                Secretary determines that the entity will meet all of 
                the requirements of this paragraph by the end of the 
                period of support under such subsection.''.
            (3) Facilities.--Section 330(e)(6) of such Act (42 U.S.C. 
        254c(e)(6)) is amended--
                    (A) by striking ``(c) or (d)'' and inserting ``(c), 
                (d) or (l)''; and
                    (B) by inserting ``network or plan'' after 
                ``community health center''.
            (4) Conforming amendments.--Section 330 of such Act (42 
        U.S.C. 254c) is amended--
                    (A) in subsection (f)--
                            (i) in paragraph (1), by striking 
                        ``(e)(2)'' and inserting ``(e)(3)''; and
                            (ii) by adding at the end thereof the 
                        following new paragraph:
    ``(3) The Secretary may award (by grant or contract) funds to 
nonprofit private entities to support the costs of developing and 
implementing, on a national basis, joint purchasing arrangements and 
other projects designed to reduce the operational costs of recipients 
of grants under this section.''; and
                    (B) in paragraphs (1) and (2) of subsection (i), by 
                striking ``subsection (d)'' and inserting ``under this 
                section''.

SEC. 3. ESTABLISHING A PROGRAM OF LOANS AND LOAN GUARANTEES.

    (a) Program of Loans and Loan Guarantees.--Subpart I of part D of 
title III of the Public Health Service Act (42 U.S.C. 254b et seq.) is 
amended by adding at the end thereof the following new section:

``SEC. 330A. FEDERAL LOAN AND LOAN GUARANTEE PROGRAM.

    ``(a) Loans and Loan Guarantees.--
            ``(1) In general.--From the fund established under 
        subsection (b), the Secretary may make loans, and guarantee the 
        payment of principal and interest to Federal and non-Federal 
        lenders for loans, to any public or nonprofit private entity 
        that receives a grant under sections 329, 330, or 340 for 
        projects for--
                    ``(A) the acquisition, modernization, expansion or 
                construction of facilities, or the conversion of 
                unneeded hospital facilities to facilities that will 
                assure or enhance the provision and accessibility of 
                primary health care and enabling services to medically 
                underserved populations;
                    ``(B) the purchase of major equipment, including 
                equipment necessary for the support of external and 
                internal information systems;
                    ``(C) the establishment of reserves required for 
                furnishing services on a prepaid basis; and
                    ``(D) such other capital costs as the Secretary may 
                determine are necessary to enable the grant recipient 
                to achieve the objectives of section 329, 330 or 340, 
                as applicable.
            ``(2) Preferences and priorities.--
                    ``(A) Preference.--In making loans and loan 
                guarantees under this section, the Secretary shall give 
                preference to applications submitted by community 
                health centers that have received grants under section 
                330(d)(1)(A) and community health service networks or 
                plans that have received grants under section 330(l).
                    ``(B) Priority.--In making loans and loan 
                guarantees under this section, the Secretary shall give 
                priority to applications for projects for the 
                renovation and modernization of medical facilities 
                necessary to prevent or eliminate safety hazards, avoid 
                noncompliance with licensure or accreditation 
                standards, or projects to replace obsolete facilities.
                    ``(C) Construction of new buildings.--The Secretary 
                may make loans or loan guarantees for the construction 
                of new buildings only if the Secretary determines that 
                appropriate facilities are not available through 
                acquiring, modernizing, expanding, or converting 
                existing buildings, or that construction of new 
                buildings will cost less.
            ``(3) Interest subsidies.--The Secretary may pay, to the 
        holder of a loan made to any recipient of a grant under 
        sections 329, 330, or 340, for and on behalf of the project for 
        which the loan was made, amounts sufficient to reduce, up to 75 
        percent the net effective interest rate otherwise payable on 
        such loan, if the Secretary finds that without such assistance 
        the project could not be undertaken.
            ``(4) Total coverage of costs.--The principal amount of a 
        loan directly made or guaranteed under this section may, when 
        added to any other assistance provided under section 329, 330, 
        or 340, cover up to 100 percent of the costs of the project for 
        which any such assistance is provided.
            ``(5) Limitation.--The cumulative total of the principal of 
        the loans outstanding at any time with respect to which 
        guarantees have been issued, or which have been directly made, 
        under this section may not exceed limitations as may be 
        specified in appropriation Acts.
            ``(6) Approval and terms and conditions.--
                    ``(A) Approval of guarantees.--The Secretary may 
                not approve a loan guarantee for a project under this 
                section unless the Secretary determines that the terms, 
                conditions, security (if any), and schedule and amount 
                of repayments with respect to the loan are sufficient 
                to protect the financial interests of the United States 
                and are otherwise reasonable.
                    ``(B) Terms and conditions.--Guarantees of loans 
                under this section shall be subject to such further 
                terms and conditions as the Secretary determines to be 
                necessary to assure that the purposes of this section 
                will be achieved.
            ``(7) Loan requirements.--
                    ``(A) In general.--The Secretary may approve a loan 
                under this section only if--
                            ``(i) the Secretary is reasonably satisfied 
                        that the applicant for the project for which 
                        the loan would be made will be able to make 
                        payments of principal and interest thereon when 
                        due; and
                            ``(ii) the applicant provides the Secretary 
                        with reasonable assurances that there will be 
                        available to the applicant such additional 
                        funds as may be necessary to complete the 
                        project or undertaking with respect to which 
                        such loan is requested.
                    ``(B) Other requirements.--Any loan made under this 
                section shall--
                            ``(i) have such security;
                            ``(ii) have such maturity date;
                            ``(iii) be repayable in such installments;
                            ``(iv) bear interest at a rate comparable 
                        to the rate of interest prevailing on the date 
                        the loan is made, minus any interest subsidy 
                        made in accordance with paragraph (3); and
                            ``(v) be subject to such other terms and 
                        conditions (including provisions for recovery 
                        in case of default), as the Secretary 
                        determines to be necessary to carry out the 
                        purposes of this section and sections 329, 330 
                        and 340, as applicable, while adequately 
                        protecting the financial interests of the 
                        United States.
                    ``(C) Waiver of right of recovery.--The Secretary 
                may, for good cause but with due regard to the 
                financial interests of the United States, waive any 
                right of recovery which the Secretary has by reason of 
                the failure of a borrower to make payments of principal 
                of and interest on a loan made under this subsection, 
                except that if such loan is sold and guaranteed, any 
                such waiver shall have no effect upon the Secretary's 
                guarantee of timely payment of principal and interest.
    ``(b) Loan and Loan Guarantee Fund.--
            ``(1) Establishment.--There is established in the Treasury 
        a loan and loan guarantee fund (hereafter in this subsection 
        referred to as the ``fund'') which shall be available as may be 
        specified from time to time in appropriations Acts to enable 
        the Secretary to make loans, loan guarantees, payment of 
        interest subsidies and such other actions as authorized under 
        subsection (a). There shall also be deposited in the fund 
        amounts received by the Secretary in connection with loans and 
        loan guarantees under this section and other property or assets 
        derived by the Secretary from operations respecting such loans 
        and loan guarantees, including any money derived from the sale 
        of assets.
            ``(2) Authorization of appropriations.--There are 
        authorized to be appropriated $100,000,000 for each of the 
        fiscal years 1995 through 2005, and such additional amounts as 
        may be necessary to provide the sums required for the fund. The 
        preceding sentence constitutes budget authority in advance of 
        appropriations Acts and represents the obligation of the 
        Federal Government to provide funding for payments in the 
        amounts and for the fiscal years authorized under this section.
    ``(c) Default.--
            ``(1) In general.--The Secretary may take such action as 
        may be necessary to prevent a default on a loan made or 
        guaranteed under subsection (a), including the waiver of 
        regulatory conditions, deferral of loan payments, renegotiation 
        of loans, and the expenditure of funds for technical and 
        consultative assistance, for the temporary payment of the 
        interest and principal on such a loan, and for other purposes.
            ``(2) Foreclosure.--The Secretary may take such action, 
        consistent with State law respecting foreclosure procedures, as 
        the Secretary deems appropriate to protect the interest of the 
        United States in the event of a default on a loan made or 
        guaranteed under subsection (a), including selling real 
        property pledged as security for such a loan or loan guarantee 
        and for a reasonable period of time taking possession of, 
        holding, and using real property pledged as security for such a 
        loan or loan guarantee.
    ``(d) Applications.--No loan or loan guarantee may be made under 
this section unless an application is submitted to and approved by the 
Secretary. The application shall be in the form and manner and contain 
such information as the Secretary may prescribe, and if the project is 
for the construction, conversion, expansion, or modernization of a 
facility, the application shall at a minimum meet the requirements of 
section 330(e)(1).
    ``(e) Right of Recovery.--
            ``(1) In general.--If any facility with respect to which a 
        loan or loan guarantee was made under this section, or with 
        respect to which a grant was made under section 329, 330, or 
        340, for the construction, acquisition, expansion, or 
        modernization, shall at any time within 20 years after 
        completion--
                    ``(A) be sold or transferred to any entity which is 
                not eligible for assistance under section 329, 330 or 
                340 or which is not approved by the Secretary as a 
                transferee; or
                    ``(B) cease to be a public or nonprofit entity that 
                is eligible for assistance under section 329, 330 or 
                340;
        the United States shall be entitled to recover from the 
        recipient of the grant, loan, or loan guarantee, the purchaser 
        or transferee, the amount of the grant, loan, or loan guarantee 
        plus interest. This right of recovery shall not constitute a 
        lien on any facility with respect to which a grant was made 
        under sections 329, 330, 340, or with respect to which funds 
        have been paid under this section.
            ``(2) Waiver.--Notwithstanding paragraph (1), the Secretary 
        shall subordinate or waive the right of recovery and any other 
        Federal interest that may be derived by virtue of a loan or 
        loan guarantee under this section, or a grant under section 
        329, 330, or 340, to support the construction, acquisition, 
        modernization, expansion, or conversion of a facility or other 
        capital project authorized under this section, where the 
        facility is being used as security for a new loan that will 
        support improvements to the facility, construction of new 
        primary health care facilities or improvements of health 
        services described in section 330(a) to medically underserved 
        populations, or where the facility is being sold in order to 
        finance the acquisition or construction of another facility 
        which will be used for the purposes authorized by section 329, 
        330 or 340, if the Secretary obtains an equivalent right of 
        recovery or interest in the new facility.''.
    (b) Tax Exemption for State and Local Bonds Not Affected by Loan 
Guarantees.--Section 149(b)(3)(A) of the Internal Revenue Code of 1986 
is amended--
            (1) in clause (ii), by striking ``or'' at the end thereof;
            (2) in clause (iii), by striking the period and inserting 
        ``, or''; and
            (3) by adding at the end thereof the following new clause:
                            ``(iv) any guarantee by the Loan and Loan 
                        Guarantee Fund pursuant to section 330A of the 
                        Public Health Service Act.''.

SEC. 4. AMENDMENTS TO THE MIGRANT HEALTH CENTERS AND HEALTH CARE FOR 
              THE HOMELESS PROGRAM AUTHORITIES.

    (a) Enabling and Outreach Services.--
            (1) Migrant health centers.--Section 329(a)(1) of the 
        Public Health Service Act (42 U.S.C. 254b(a)(1)) is amended--
                    (A) in the matter preceding subparagraph (A), by 
                inserting after ``entities provides'' the following: 
                ``at appropriate locations, which may include schools 
                and other sites'';
                    (B) in subparagraph (G), by striking ``and'' at the 
                end thereof;
                    (C) in subparagraph (H)--
                            (i) by inserting after the subparagraph 
                        designation the following: ``the services of 
                        outreach workers and others to determine, or 
                        assist in determining, the eligibility of 
                        individuals to receive services and benefits 
                        under Federal, State, and local health 
                        programs, and to assist such individuals in 
                        enrolling in such programs, and other''; and
                            (ii) by adding ``and'' at the end thereof; 
                        and
                    (D) by inserting after subparagraph (H), the 
                following new subparagraph:
                    ``(I) enabling services (defined as services that 
                are not otherwise described in this subsection) that 
                promote access to necessary health and other human and 
                social services, and that increase the capacity of 
                individuals to utilize the items and services that are 
                included as covered benefits under Federal, State, or 
                local health programs,''.
            (2) Homeless health services.--Section 340(i) of such Act 
        (42 U.S.C. 256(i)) is amended--
                    (A) in paragraph (1)--
                            (i) in subparagraph (B), by adding ``and'' 
                        at the end thereof;
                            (ii) in subparagraph (C), by striking ``; 
                        or'' and inserting a period; and
                            (iii) by striking subparagraph (D); and
                    (B) in paragraph (2), to read as follows:
    ``(2) A grant may include the acquisition, expansion, or 
modernization of existing buildings, and the construction of new 
buildings (if the Secretary determines that appropriate facilities are 
not available through the acquisition, expansion or modernization of 
existing buildings, or that construction of a new building will cost 
less).''.
            (3) Definitions.--Section 340(r) of such Act (42 U.S.C. 
        256(r)) is amended--
                    (A) in paragraph (1), by adding ``, supplemental 
                health services and enabling services'' before 
                ``substance abuse services''; and
                    (B) in paragraph (6), to read as follows:
            ``(6) The terms `primary health services', `supplemental 
        health services' and `enabling services' shall have the same 
        meanings given such terms in section 330(a).''.
    (b) Authorization of Appropriations.--
            (1) Migrant health centers.--Section 329(h)(1)(A) of such 
        Act (42 U.S.C. 254b(h)(1)(A)) is amended by striking 
        ``$48,500,000'' and all that follows through the end thereof 
        and inserting the following: ``$100,000,000 for fiscal year 
        1995, $110,000,000 for fiscal year 1996, $120,000,000 for 
        fiscal year 1997, $130,000,000 for fiscal year 1998, 
        $140,000,000 for fiscal year 1999, $150,000,000 for fiscal year 
        2000, and not less than $150,000,000 for each of the fiscal 
        years 2001 through 2005. The preceding sentence constitutes 
        budget authority in advance of appropriations Acts and 
        represents the obligation of the Federal Government to provide 
        funding for payments in the amounts, and for the fiscal years 
        specified under this section. Such levels shall not be subject 
        to offset or reprogramming for any reason.''.
            (2) Homeless health services.--Section 340(q)(1) of such 
        Act (42 U.S.C. 256(q)(1)) is amended by striking 
        ``$70,000,000'' and all that follows through the end thereof 
        and inserting the following: ``$100,000,000 for fiscal year 
        1995, $110,000,000 for fiscal year 1996, $120,000,000 for 
        fiscal year 1997, $130,000,000 for fiscal year 1998, 
        $140,000,000 for fiscal year 1999, $150,000,000 for fiscal year 
        2000, and not less than $150,000,000 for each of the fiscal 
        years 2001 through 2005. The preceding sentence constitutes 
        budget authority in advance of appropriations Acts and 
        represents the obligation of the Federal Government to provide 
        funding for payments in the amounts, and for the fiscal years 
        specified under this section. Such levels shall not be subject 
        to offset or reprogramming for any reason.''.

SEC. 5. EXPANDING THE NATIONAL HEALTH SERVICE CORPS.

    (a) Additional Funding for Corps Programs.--Section 338(a) of the 
Public Health Service Act (42 U.S.C. 254k(a)) is amended--
            (1) by redesignating paragraph (2) as paragraph (3); and
            (2) by inserting after paragraph (1), the following new 
        paragraph:
    ``(2)(A) For the purpose of carrying out this paragraph, there are 
authorized to be appropriated $50,000,000 for fiscal year 1995, 
$100,000,000 for fiscal year 1996, and $200,000,000 for each of the 
fiscal years 1997 through 2000. The preceding sentence constitutes 
budget authority in advance of appropriations Acts and represents the 
obligation of the Federal Government to provide funding for payments in 
the amounts, and for the fiscal years, specified under this section. 
Such levels shall not be subject to offset or reprogramming for any 
reason.
    ``(B) The authorizations of appropriations established in 
subparagraph (A) are in addition to the authorizations of 
appropriations in paragraph (1).
    ``(C) Of the amounts appropriated under subparagraph (A), the 
Secretary shall reserve such amounts as may be necessary to ensure 
that, of the aggregate number of individuals who are participants in 
the Scholarship Program under section 338A, or in the Loan Repayment 
Program under section 338B, the total number who are being educated as 
nurses or are serving as nurses, respectively, is increased to 20 
percent.
    ``(D) Notwithstanding section 333(a)(3) and the priorities stated 
in section 333A for approval of applications for the assignment of 
Corps members, to the extent that additional funds appropriated 
pursuant to subparagraph (A) increases the number of individuals 
participating in the Scholarship Program under section 338A and in the 
Loan Repayment Program under section 338B over the number of 
individuals participating in such programs in fiscal year 1994, the 
Secretary shall give preference in assigning those individuals to 
applicants that serve a health professional shortage area and receive 
grants to provide health services and enabling services under section 
329, 330 or 340 (including, but not limited to, networks and plans 
awarded funds under section 330) and other federally qualified health 
centers as defined in section 1861(aa)(4) of the Social Security 
Act.''.

SEC. 6. FACILITATING THE PARTICIPATION OF COMMUNITY PROVIDERS IN HEALTH 
              PROFESSIONS TRAINING.

    (a) Preference for Certain Health Professions Program Applicants.--
Section 791(a)(1) of the Public Health Service Act (42 U.S.C. 
295j(a)(1)) is amended--
            (1) by inserting after ``or 767,'' the following: ``or 
        under sections 777 and 778, in addition to preferences stated 
        in such sections,''; and
            (2) by striking subparagraphs (A) and (B) and inserting the 
        following new subparagraphs:
                    ``(A) is (or is a co-applicant with) an entity that 
                receives support under section 329, 330, or 340, or 
                that is certified as a federally qualified health 
                center under section 1861(aa)(4) of the Social Security 
                Act; and
                    ``(B) either--
                            ``(i) has a high rate for placing graduates 
                        in practice settings having the principle focus 
                        of serving residents of medically underserved 
                        communities; or
                            ``(ii) during the 2-year period preceding 
                        the fiscal year for which such an award is 
                        sought, has achieved a significant increase in 
                        the rate of placing graduates in such 
                        settings.''.
    (b) Preference for Certain Nurse Training Program Applicants.--
Section 860(e)(1)(A) of such Act (42 U.S.C. 298b-7(e)(1)(A)) is 
amended--
            (1) by striking ``821, 822, 830, and 831'' and inserting 
        ``820(b), 820(c), 821, 822, 827, 830, and 831'';
            (2) by striking clauses (i) and (ii) and inserting the 
        following new clauses:
                            ``(i) is (or is a co-applicant with) an 
                        entity that receives support under section 329, 
                        330, or 340, or that is certified as a 
                        federally qualified health center under section 
                        1861(aa)(4) of the Social Security Act; and
                            ``(ii) either--
                                    ``(I) has a high rate for placing 
                                graduates in practice settings having 
                                the principle focus of serving 
                                residents of medically underserved 
                                communities; or
                                    ``(II) during the 2-year period 
                                preceding the fiscal year for which 
                                such an award is sought, has achieved a 
                                significant increase in the rate of 
                                placing graduates in such settings.''.
    (c) Payment for Direct Costs of Graduate Medical Education.--
Section 1886(h)(4)(E) of the Social Security Act (42 U.S.C. 
1395ww(h)(4)(E)) is amended by striking ``that setting.'' and inserting 
the following: ``that setting (or, in the case of activities performed 
at a federally qualified health center described in section 
1861(aa)(4), if the hospital incurs any of the costs for the training 
program at such center and reimburses the center for any of the costs 
of the program that the center incurs).''.
    (d) Payment for Indirect Costs of Graduate Medical Education.--
Section 1886(d)(5)(B)(iv) of the Social Security Act (42 U.S.C. 
1395ww(d)(5)(B)(iv)), as amended by section 13506 of the Omnibus Budget 
Reconciliation Act of 1993, is amended--
            (1) by striking ``entity receiving a grant'' and all that 
        follows through ``control of the hospital'' and inserting 
        ``federally qualified health center described in section 
        1861(aa)(4)'';
            (2) by striking ``all, or substantially all, of the costs'' 
        and inserting ``any of the costs''; and
            (3) by striking ``residents)'' and inserting ``residents 
        and reimburses the center for any of the costs of the program 
        that the center incurs)''.
    (e) Clarifying Allowability of Costs.--Section 1833(a)(3) of the 
Social Security Act (42 U.S.C. 1395l(a)(3)) is amended by inserting 
after words ``furnishing such services'' the following: ``(including, 
without limitation, all costs associated with participation in an 
approved medical residency training program)''.
    (f) Effective Date.--The amendments made by subsections (c), (d), 
and (e) shall apply to services furnished during cost reporting periods 
beginning on or after October 1, 1994.

SEC. 7. PROVIDING SAFEGUARDS FOR RURAL HEALTH CLINICS AND FEDERALLY 
              QUALIFIED HEALTH CENTERS IN MEDICAID DEMONSTRATIONS.

    (a) Freedom of Choice.--Section 1115(a)(1) of the Social Security 
Act (42 U.S.C. 1315(a)(1)) is amended by inserting after ``or 1902'' 
the following: ``(other than sections 1902(a)(13)(E), 1902(a)(10)(A), 
and 1902(a)(23) insofar as they require the provision of, payment for, 
and allow freedom of choice to select the provider of, the care and 
services described in section 1905(a)(2)(B) and (C))''.
    (b) No Authority to Waive Compliance.--Section 1115(a)(2) of such 
Act (42 U.S.C. 1315(a)(2)) is amended by inserting before the period 
the following: ``, except that this paragraph shall not provide 
authority for the Secretary to waive compliance by a State with the 
requirements of section 1903(m)(2)(A)(ix) or 1903(m)(3)''.
    (c) Waivers.--Section 1915(b) of such Act (42 U.S.C. 1396n(b)) is 
amended--
            (1) in the first sentence, by striking ``1905(a)(2)(C)'' 
        and inserting ``1905(a)(2)(B) and (C)''; and
            (2) in the last sentence, by inserting before the period 
        the following: ``or under section 1905(a)(2)(B) and (C)''.
    (d) Payments to States.--Section 1903(m) of such Act (42 U.S.C. 
1396b(m)) is amended:
            (1) in paragraph (2)(G), by inserting ``or is an entity 
        primarily owned and controlled by such grantee or grantees,'' 
        after ``Public Health Service Act''; and
            (2) by inserting after paragraph (2) the following new 
        paragraph:
    ``(3) Notwithstanding sections 1115 and 1915(b), in the event that 
a State agency contracts with an entity described in paragraph (2)(A) 
or an entity similar to such entity, such State agency, upon receiving 
an offer to provide health care services from a rural health clinic or 
a federally qualified health center operating in the same geographic 
area as such entity, shall enter into a contract with such clinic or 
center for the provision of all health care services referred to in 
such offer and, unless the clinic or center elects otherwise, the 
payment made by the State to such clinic or center for services 
described in section 1905(a)(2) (B) and (C) to the individuals proposed 
to be served in the clinic's or center's offer shall be made at the 
rates of payment specified in section 1902(a)(13)(E).''.
    (e) Conforming Amendments.--
            (1) State plans.--Section 1902(e)(2)(A) of such Act (42 
        U.S.C. 1396a(e)(2)(A)) is amended by inserting ``(or an entity 
        primarily owned and controlled by a grantee or grantees 
        described in paragraph (2)(G))'' after ``(2)(G)''.
            (2) State payments.--Section 1903(m)(2)(F)(i) of such Act 
        (42 U.S.C. 1396b(m)(2)(F)(i)) is amended by inserting ``(or an 
        entity primarily owned and controlled by a grantee or grantees 
        described in subparagraph (G))'' after ``(G)''.

SEC. 8. PROVIDING SAFE HARBOR FOR CERTAIN COLLABORATIVE EFFORTS THAT 
              BENEFIT MEDICALLY UNDERSERVED PERSONS.

    Section 1128B(b)(3) of the Social Security Act (42 U.S.C. 1320a-
7b(b)(3)) is amended--
            (1) in subparagraph (D), by striking ``and'' at the end 
        thereof;
            (2) in subparagraph (E), by striking the period and 
        inserting ``; and''; and
            (3) by adding at the end thereof the following new 
        subparagraph:
            ``(F) any remuneration paid by or to a recipient or 
        subrecipient of Federal grant funds under or in connection with 
        an arrangement for the procurement of goods or services by the 
        recipient or subrecipient, the referral of patients, or the 
        lease or purchase of space or equipment, if--
                    ``(i) the arrangement is in writing and signed by 
                the parties;
                    ``(ii) the arrangement will result in the savings 
                of Federal grant funds or increased revenues to the 
                recipient or subrecipient that will be used to increase 
                the availability or accessibility of services to a 
                medically underserved population served by the 
                recipient or subrecipient or an improvement in the 
                quality of services to such population: Provided, that 
                the recipient or subrecipient may seek a prior 
                determination from the Public Health Service that the 
                requirement of this clause is met and, if the recipient 
                or subrecipient does so, Public Health Service approval 
                shall be conclusive and binding on the Federal 
                Government;
                    ``(iii) the arrangement will not result in private 
                inurement to any current employees or members of the 
                Board of Directors of the recipient or subrecipient, or 
                to agents of the recipient or subrecipient who were 
                involved in recommending or negotiating the 
                arrangement;
                    ``(iv) with respect to an arrangement under which a 
                recipient or subrecipient is procuring goods or 
                services, the provider of the goods or services is the 
                only provider able to supply such goods or services, or 
                the recipient or subrecipient has engaged in a 
                competitive process to procure the goods or services 
                that meets the requirements for competition under 
                Federal grant awards;
                    ``(v) with respect to an arrangement for a referral 
                of patients, the arrangement will assure that all 
                patients covered or affected by the arrangement are 
                advised that they may request a referral to any person 
                or entity of their choosing, subject to appropriate 
                contractual limitations under which the recipient or 
                subrecipient may operate as a health plan or as a 
                contract health plan provider and such limitations as 
                the patient may be under as an enrollee of a health 
                plan; and
                    ``(vi) with respect to an arrangement for a 
                referral of patients, the arrangement will not 
                interfere with the discretion of health professionals 
                to refer patients in a manner they believe will most 
                appropriately deal with a patient's particular 
                circumstances, subject to appropriate contractual 
                limitations under which the recipient or subrecipient 
                may operate as a health plan or as a contract health 
                plan provider and such limitations as the patient may 
                be under as an enrollee of a health plan.
With respect to any arrangement that does not meet the requirements of 
subparagraph (F), paragraphs (1) and (2) shall not apply when the 
recipient or subrecipient of Federal grant funds has applied to the 
Secretary for approval of the arrangement and the Secretary, after 
consultation with the Department of Health and Human Services Office of 
Inspector General, has approved the arrangement based upon a finding 
that the arrangement will produce a substantial benefit to a medically 
underserved population that outweighs the arrangement's failure to 
fully satisfy all of the requirements of such subparagraph. For any 
arrangement existing on the date of enactment of the Access to 
Community Health Care Act of 1994, that involves a recipient or 
subrecipient of Federal grant funds that does not meet the requirements 
of subparagraph (F) and would subject the recipient or subrecipient to 
criminal penalties under paragraphs (1) or (2), the recipient or 
subrecipient shall be immune from criminal prosecution under paragraph 
(1) or (2), except that such immunity shall only apply if, not later 
than 6 months after such date of enactment, the arrangement is 
terminated or amended to conform to the requirements of subparagraph 
(F). For purposes of this paragraph, a `recipient' shall mean a public 
or nonprofit private entity that receives a grant or cooperative 
agreement under the Public Health Service Act or under title V of this 
Act. For purposes of this section, a `subrecipient' shall mean a public 
or nonprofit private entity that performs substantive work under a 
grant or cooperative agreement under the Public Health Service Act or 
under title V of this Act to a recipient.''.

                                 <all>

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