(1) IN GENERAL.—Funds made available under
this section may be used for the following:
(A) To develop integrated health networks,
utilizing existing local providers and facilities
where appropriate, with community involve-
ment.
(B) For information systems, including
telecommunications.
(C) For transportation services.
(2) LIMITATIONS.—Funds made available under
this section shall not be used for the following:
(A) For a telecommunications system, un-
less the system is coordinated with, and does
not duplicate, such a system existing in the
area.
(B) For paying off existing debt.
(d) FUNDING.—For the purpose of carrying out this
section, there are authorized to be appropriated
$50,000,000 for fiscal year 1996, $50,000,000 for fiscal
year 1997, and $50,000,000 for fiscal year 1998.
SEC. 104. PRIMARY HEALTH CARE FOR MEDICALLY UNDER-
SERVED RURAL COMMUNITIES; INCREASED
CAPACITY OF HOSPITALS AND OUTPATIENT
FACILITIES.
(a) IN GENERAL.—The Secretary may make grants
to public and nonprofit private hospitals in medically un-
derserved rural communities, and to public and nonprofit
private outpatient facilities in such communities, for the
purpose of carrying out projects to develop or increase the
capacity of the hospitals and facilities to provide primary
health services.
(b) MEDICALLY
UNDERSERVED
RURAL
COMMU-
NITY.—For purposes of this section, the term ‘‘medically
underserved rural community’’ means—
(1) a rural area that has a substantial number
of individuals who are members of a medically un-
derserved population, as defined in section 330 of
the Public Health Service Act; or
(2) a rural area a significant portion of which
is a health professional shortage area designated
under section 332 of such Act.
(c) CERTAIN EXPENDITURES.—
(1) IN GENERAL.—The purposes for which the
Secretary may authorize a grant under subsection
(a) to be expended include the renovation of facili-
ties, the purchase of equipment, and the recruitment
and retention of personnel.
(2) CERTAIN
FACILITIES.—The purposes for
which the Secretary may authorize a grant under
subsection (a) to be expended include—
(A) the development of rural emergency
medical care hospitals; and
(B) the development of nurse-managaged
health centers for the provision of primary
health care services in rural areas and for co-
ordinating with health care providers and net-
works.
(d) DEFINITIONS.—
(1) RURAL EMERGENCY MEDICAL CARE HOS-
PITALS.—For purposes of this section, a rural emer-
gency medical care hospital is a facility with the fol-
lowing characteristics:
(A) It is a hospital that is in danger of
closing due to low inpatient utilization rates
and operating losses.
(B) The closure of the facility would limit
the access of individuals residing in the facili-
ty’s service area to emergency services.
(C) The facility has entered into (or in-
tends to enter into) an agreement with another
hospital that will accept the transfer of pa-
tients.
(D) A physician is available on-call to pro-
vide emergency medical services on a 24-hour-
a-day basis.
(E) The facility must have a practitioner
who is qualified to provide advanced cardiac life
support services (as determined by the State in
which the facility is located) on-site at the facil-
ity on a 24-hour-a-day basis.
(F) The facility meets such staffing re-
quirements as would apply under section
1861(e) of the Social Security Act, except that
the facility need not meet hospital standards re-
lating to the number of hours during a day, or
days during a week, in which the facility must
be open, but must provide emergency care on a
24-hour-a-day basis.
(2) NURSE-MANAGED HEALTH CENTERS.—For
purposes of this section, the term ‘‘nurse-managed
health center’’ means a health center meeting the
following conditions (to the extent in accordance
with applicable law): The services of the center are
primary health services; the principal providers of
such services through the center are nurse practi-
tioners, certified nurse midwives, and clinical nurse
specialists; the principal managers of the center are
professional nurses; and the procedures of the center
provide patients with direct access to nurse practi-
tioners, certified nurse midwives, or clinical nurse
specialists.
(e) FUNDING.—
(1) HOSPITALS.—For the purpose of making
grants to hospitals under subsection (a), there are
authorized to be appropriated $50,000,000 for fiscal
year 1996, $50,000,000 for fiscal year 1997, and
$50,000,000 for fiscal year 1998.
(2) OUTPATIENT FACILITIES.—For the purpose
of making grants to outpatient facilities under sub-
section (a), there are authorized to be appropriated
$50,000,000 for fiscal year 1996, $50,000,000 for
fiscal year 1997, and $50,000,000 for fiscal year
1998.
SEC. 105. TRAINING OF RURAL HEALTH PROFESSIONALS
OTHER THAN PHYSICIANS.
(a) FUNDING
FOR
PROGRAMS
UNDER
PUBLIC
HEALTH SERVICE ACT.—With respect to programs of
title VII or VIII of the Public Health Service Act that
provide for the training of individuals as health profes-
sionals other than physicians, there are authorized to be
appropriated for the purpose of carrying out such pro-
grams, through entities described in subsection (b),
$50,000,000 for each of the fiscal years 1996 through
1998.
(b) ELIGIBILITY.—With respect to a program re-
ferred to in subsection (a), an entity described in this sub-
section is an entity—
(1) that is eligible to receive grants or contracts
under the program (as provided in the applicable
provisions of title VII or VIII of the Public Health
Service Act); and
(2) a substantial number of whose designated
graduates are providing health services in a rural
area.
(c) DEFINITION OF DESIGNATED GRADUATE.—For
purposes of this section, the term ‘‘designated graduate’’,
with respect to an entity, means an individual completing
the training involved during the 5-year period preceding
the fiscal year for which the entity is applying to receive
a grant or contract under the applicable program referred
to in subsection (a).
(d) CERTAIN PROGRAMS.—Programs carried out
under subsection (a) shall include programs for nurse
practitioners, physician assistants, and nurse midwives.
TITLE II—PROVISIONS
RELATING TO MEDICARE
SEC. 201. MEDICARE INCENTIVES FOR PHYSICIANS TO PRO-
VIDE PRIMARY CARE.
(a) UNDERSERVED AREA BONUS PAYMENTS; IN-
CREASE IN AMOUNT OF PAYMENT FOR PRIMARY CARE
SERVICES.—Section 1833(m) of the Social Security Act
(42 U.S.C. 1395l(m)) is amended—
(1) by striking ‘‘10 percent’’ and inserting ‘‘a
percent’’,
(2) by striking ‘‘service’’ the last place it ap-
pears and inserting ‘‘services’’, and
(3) by adding the following new sentence: ‘‘The
percent referred to in the previous sentence is 20
percent in the case of primary care services, as de-
fined in section 1842(i)(4), and 10 percent for serv-
ices other than primary care services furnished in
health professional shortage areas located in rural
areas as defined in section 1886(d)(2)(D).’’.
(b) EFFECTIVE DATE.—The amendments made by
subsection (a) are effective for services furnished on or
after January 1, 1996.
TITLE III—TAX INCENTIVES FOR
HEALTH SERVICES PROVIDERS
SEC. 301. NONREFUNDABLE CREDIT FOR CERTAIN PRI-
MARY HEALTH SERVICES PROVIDERS.
(a) IN GENERAL.—Subpart A of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of
1986 (relating to nonrefundable personal credits) is
amended by inserting after section 22 the following new
section:
‘‘SEC. 23. PRIMARY HEALTH SERVICES PROVIDERS.
‘‘(a) ALLOWANCE OF CREDIT.—There shall be al-
lowed as a credit against the tax imposed by this chapter
for the taxable year an amount equal to the product of—
‘‘(1) the number of months during such taxable
year—
‘‘(A) during which the taxpayer is a quali-
fied primary health services provider, and
‘‘(B) which are within the taxpayer’s man-
datory service period, and
‘‘(2) $1,000 ($500 in the case of a qualified
practitioner who is not a physician).
‘‘(b) QUALIFIED PRIMARY HEALTH SERVICES PRO-
VIDER.—For purposes of this section, the term ‘qualified
primary health services provider’ means, with respect to
any month, any qualified practitioner who—
‘‘(1) has in effect a certification by the Bureau
as a provider of primary health services and such
certification is, when issued, for a health profes-
sional shortage area in which the qualified practi-
tioner is commencing the providing of primary
health services,
‘‘(2) is providing primary health services full
time in the health professional shortage area identi-
fied in such certification, and
‘‘(3) has not received a scholarship under the
National Health Service Corps Scholarship Program
or any loan repayments under the National Health
Service Corps Loan Repayment Program.
For purposes of paragraph (2), a provider shall be treated
as providing services in a health professional shortage area
when such area ceases to be such an area if it was such
an area when the provider commenced providing services
in the area.
‘‘(c) MANDATORY SERVICE PERIOD.—For purposes
of this section, the term ‘mandatory service period’ means
the period of 60 consecutive calendar months beginning
with the first month the taxpayer is a qualified primary
health services provider. A taxpayer shall not have more
than 1 mandatory service period.
‘‘(d) DEFINITIONS AND SPECIAL RULES.—For pur-
poses of this section—
‘‘(1) BUREAU.—The term ‘Bureau’ means the
Bureau of Primary Health Care, Health Resources
and Services Administration of the United States
Public Health Service.
‘‘(2) QUALIFIED
PRACTITIONER.—The term
‘qualified practitioner’ means a physician, a physi-
cian assistant, a nurse practitioner, or a certified
nurse-midwife.
‘‘(3) PHYSICIAN.—The term ‘physician’ has the
meaning given to such term by section 1861(r) of
the Social Security Act.
‘‘(4) PHYSICIAN
ASSISTANT; NURSE
PRACTI-
TIONER.—The terms ‘physician assistant’ and ‘nurse
practitioner’ have the meanings given to such terms
by section 1861(aa)(5) of the Social Security Act.
‘‘(5) CERTIFIED
NURSE-MIDWIFE.—The term
‘certified nurse-midwife’ has the meaning given to
such term by section 1861(gg)(2) of the Social Secu-
rity Act.
‘‘(6) PRIMARY HEALTH SERVICES.—The term
‘primary health services’ has the meaning given such
term by section 330(b)(1) of the Public Health Serv-
ice Act.
‘‘(7) 
HEALTH
PROFESSIONAL
SHORTAGE
AREA.—The term ‘health professional shortage area’
has the meaning given such term by section
332(a)(1)(A) of the Public Health Service Act.
‘‘(e) RECAPTURE OF CREDIT.—
‘‘(1) IN
GENERAL.—If there is a recapture
event during any taxable year, then—
‘‘(A) no credit shall be allowed under sub-
section (a) for such taxable year and any suc-
ceeding taxable year, and
‘‘(B) the tax of the taxpayer under this
chapter for such taxable year shall be increased
by an amount equal to the product of—
‘‘(i) the applicable percentage, and
‘‘(ii) the aggregate unrecaptured cred-
its allowed to such taxpayer under this sec-
tion for all prior taxable years.
‘‘(2) APPLICABLE RECAPTURE PERCENTAGE.—
‘‘(A) IN GENERAL.—For purposes of this
subsection, the applicable recapture percentage
shall be determined from the following table:
‘‘If the recapture
The applicable recap-
event occurs during:
ture percentage is:
Months 1–24 ..............................................
100
Months 25–36 ............................................
Months 37–48 ............................................
Months 49–60 ............................................
Months 61 and thereafter ..........................
0.