II 

110TH CONGRESS 

2D SESSION S. 3468 

To amend title XVIII of the Social Security Act to continue the ability 

of hospitals to supply a needed workforce of nurses and allied health 

professionals by preserving funding for hospital operated nursing and 

allied health education programs. 

IN THE SENATE OF THE UNITED STATES 

SEPTEMBER 10, 2008 

Mr. SCHUMER (for himself and Mr. ALEXANDER) introduced the following bill; 

which was read twice and referred to the Committee on Finance 

A BILL 

To amend title XVIII of the Social Security Act to continue 

the ability of hospitals to supply a needed workforce 

of nurses and allied health professionals by preserving 

funding for hospital operated nursing and allied health 

education programs. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Nursing and Allied 

5 Health Education Preservation Act of 2008’’. 


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1 SEC. 2. PRESERVATION OF PROVIDER OPERATED NURSING 

2 AND ALLIED HEALTH EDUCATION PRO3 GRAMS. 

4 (a) IN GENERAL.—Section 1861(v) of the Social Se5 curity Act (42 U.S.C. 1395x(v)) is amended by adding at 

6 the end the following new paragraph: 

7 ‘‘(9) PRESERVATION OF PROVIDER-OPERATED

8 NURSING AND ALLIED HEALTH EDUCATION PRO9 GRAMS.— 

10 ‘‘(A) IN GENERAL.—The Secretary shall not 

11 deny provider-operated status for a nursing and al12 lied health education program that substantially 

13 meets requirements in effect under paragraphs (e) 

14 and (f) of section 413.85 of title 42, Code of Federal 

15 Regulations, as of October 1, 2006, on the basis of 

16 an organizational structure, contractual arrange17 ments, or legal structure of the program, or a 

18 change in such a structure or arrangement, such as 

19 those described in subparagraph (B), so long as a 

20 hospital, hospitals, or health system continues to 

21 substantially control the nursing or allied health pro22 gram. 

23 ‘‘(B) EXAMPLES OF ARRANGEMENTS AND

24 STRUCTURES.—The following are examples of an or25 ganizational structure, contractual arrangement, 

26 legal structure, or a change in such a structure or 


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1 arrangement, referred to in subparagraph (A) of a 

2 provider-operated program: 

3 ‘‘(i) The students enrolled in the program 

4 are concurrently enrolled in a college, commu5 nity college, or university or receive degrees, di6 plomas, or other certificates or credentials upon 

7 graduation from both the nursing or allied 

8 health education and the college, community 

9 college, or university. 

10 ‘‘(ii) The program enters into an agree11 ment with a third-party to provide classroom, 

12 administrative, or financial services if the con13 tract is related to the nursing or allied health 

14 education activity and the hospital or other pro15 vider retains the authority to modify, amend, 

16 rescind, or renew the agreement. 

17 ‘‘(iii) The program fails to comply with 

18 regulations or requirements promulgated for 

19 such a program because such compliance would 

20 result in direct conflict with requirements— 

21 ‘‘(I) of the State Board of Nursing or 

22 other regulatory agency in the State in 

23 which the program is located; or 

24 ‘‘(II) of a national nursing or allied 

25 health accreditation body or a regional, inVerDate Aug 31 2005 01:04 Sep 11, 2008 Jkt 069200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S3468.IS S3468

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1 stitutional accrediting body that is recog2 nized by the Department of Education or 

3 such a State Board or regulatory agency. 

4 ‘‘(iv) The program which is offered by a 

5 for profit college or university is wholly owned 

6 by a hospital or health system, or by a non7 profit college or university that is operated by 

8 a hospital or health system, and collectively the 

9 college or university and the hospital or health 

10 system meets all the requirements in effect 

11 under paragraphs (e) and (f) of section 413.85 

12 of title 42, Code of Federal Regulations. 

13 ‘‘(v) The nursing or allied health education 

14 program is operated by one or more hospitals, 

15 or a health system or chain organization, or any 

16 combination of a hospital or hospitals and pro17 viders or entities whose principal business is 

18 providing hospital services. 

19 ‘‘(C) LIMITATION ON PAYMENT DENIALS.—The 

20 Secretary— 

21 ‘‘(i) shall not recoup, withhold, offset, dis22 allow, or deny reasonable cost, pass-through 

23 payment for the costs of approved educational 

24 activities for a nursing or allied health edu25 cation program described in subparagraph (A) 


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1 on a ground for which a denial of provider-oper2 ated status is not permitted under such sub3 paragraph; 

4 ‘‘(ii) shall not reopen any cost reporting 

5 year of any hospital for the purpose of effecting 

6 any recoupment or other denial of payment de7 scribed in clause (i) and shall withdraw and dis8 continue any such reopening effected before the 

9 date of the enactment of this paragraph; and 

10 ‘‘(iii) shall restore to a hospital any such 

11 recoupment or denial effected for a previous 

12 cost reporting year by not later than the hos13 pital’s cost reporting year beginning after such 

14 date of enactment. 

15 ‘‘(D) CONSTRUCTION.—This paragraph shall 

16 not affect payment— 

17 ‘‘(i) with respect to a provider-operated 

18 program which is in compliance with regula19 tions and guidance issued as of the date of the 

20 enactment of this paragraph; or 

21 ‘‘(ii) to a hospital or provider with respect 

22 to reasonable cost, pass-through reimbursement 

23 pursuant to section 4004(b) of the Omnibus 


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1 Budget Reconciliation Act of 1990 (Public Law 

2 101–508; 104 Stat. 1388–39).’’. 

Æ 


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