I 
114TH CONGRESS 
2D SESSION 
H. R. 6512 
To authorize the Secretary of Health and Human Services to make loans 
and loan guarantees for constructing or renovating, or planning construc-
tion or renovation of, qualified psychiatric and substance abuse treatment 
facilities, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
DECEMBER 8, 2016 
Mr. KILMER (for himself, Ms. HERRERA BEUTLER, and Mr. MURPHY of 
Pennsylvania) introduced the following bill; which was referred to the 
Committee on Energy and Commerce 
A BILL 
To authorize the Secretary of Health and Human Services 
to make loans and loan guarantees for constructing or 
renovating, or planning construction or renovation of, 
qualified psychiatric and substance abuse treatment fa-
cilities, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Mental Health and 
Substance Abuse Treatment Accessibility Act of 2016’’. 
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SEC. 2. LOANS AND LOAN GUARANTEES. 
Part P of title III of the Public Health Service Act 
is amended by inserting after section 399V–6 of such Act 
(21 U.S.C. 355f) the following: 
‘‘SEC. 399V–7. LOANS AND LOAN GUARANTEES FOR CON-
STRUCTING OR RENOVATING, OR PLANNING 
CONSTRUCTION OR RENOVATION OF, CER-
TAIN QUALIFIED PSYCHIATRIC AND SUB-
STANCE ABUSE TREATMENT FACILITIES. 
‘‘(a) IN GENERAL.—The Secretary may make loans 
and loan guarantees for constructing or renovating, in-
cluding planning the construction or renovation of, a 
qualified psychiatric treatment facility or a qualified sub-
stance abuse treatment facility to public, private for-prof-
it, or private not-for-profit— 
‘‘(1) psychiatric treatment facilities; 
‘‘(2) substance abuse treatment facilities; 
‘‘(3) psychiatric hospitals; and 
‘‘(4) alliances of such facilities or hospitals. 
‘‘(b) PREFERENCE.—In making loans and loan guar-
antees under this section, the Secretary shall give pref-
erence to psychiatric treatment facilities and substance 
abuse treatment facilities that propose to construct or ren-
ovate a qualified psychiatric treatment facility or qualified 
substance abuse treatment facility in a county that has 
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insufficient inpatient psychiatric or substance abuse treat-
ment capacity. 
‘‘(c) TERMS
AND CONDITIONS.—Loans and loan 
guarantees under this section shall be made on such terms 
and conditions as the Secretary may prescribe, subject to 
the provisions of this section including the following: 
‘‘(1) The Secretary may allow credit to a pro-
spective borrower only where— 
‘‘(A) it is necessary to increase the number 
of psychiatric or substance use disorder treat-
ment beds to enhance the public’s access to 
acute inpatient mental health and substance 
abuse services; and 
‘‘(B) a credit subsidy is the most efficient 
way to achieve such increase (on a borrower-by- 
borrower basis). 
‘‘(2) The final maturity of loans made or guar-
anteed under this section shall not exceed a period 
of 20 years, or the period of 50 percent of the useful 
life of any physical asset to be financed by the loan, 
whichever is less as determined by the Secretary. 
‘‘(3) The Secretary may not make a loan guar-
antee under this section, with respect to any bor-
rower, in excess of 80 percent of any potential loss 
on the loan. 
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‘‘(4) The Secretary may not make any loan or 
loan guarantee under this section if the loan will be 
subordinated— 
‘‘(A) to another debt contracted by the 
borrower; or 
‘‘(B) to any other claims against the bor-
rower in the case of default. 
‘‘(5) The Secretary may not make any loan 
guarantee under this section unless the Secretary 
determines that— 
‘‘(A) the lender is responsible; and 
‘‘(B) adequate provision is made for serv-
icing the loan on reasonable terms and pro-
tecting the financial interest of the United 
States. 
‘‘(6) The Secretary may not make any loan 
guarantee under this section if the income from the 
loan will be excluded from gross income for purposes 
of chapter 1 of the Internal Revenue Code of 1986. 
‘‘(7) The Secretary may not make any loan or 
loan guarantee under this section unless— 
‘‘(A) the loan and interest supplements on 
any loan guarantee will be at an interest rate 
that is set by reference to a benchmark interest 
rate on marketable Treasury securities with a 
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similar maturity to the loan being made or 
guaranteed; and 
‘‘(B) the minimum interest rate on the 
loan— 
‘‘(i) will be no less than the estimated 
cost to the Government of making the loan 
plus 1 percent, with the goal of keeping 
the interest rate below the interest rate of 
a comparable and competitive private sec-
tor benchmark financial instrument; and 
‘‘(ii) will be adjusted, as determined 
by the Secretary, every quarter to take ac-
count of changes in the interest rate of the 
benchmark financial instrument. 
‘‘(8) The Secretary may not make any loan or 
loan guarantee under this section unless— 
‘‘(A) fees or premiums on the loan or loan 
guarantee and corresponding insurance cov-
erage will be set at levels that minimize the cost 
to the Government (as defined in section 502(5) 
of the Federal Credit Reform Act of 1990) of 
insuring such loan or loan guarantee, while sup-
porting achievement of increasing the inpatient 
psychiatric and substance abuse bed count, as 
applicable, to enhance the public’s access to 
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acute inpatient mental health and substance 
abuse services; 
‘‘(B) the minimum guarantee fee or insur-
ance premium imposed by the Government will 
be no less than the level sufficient to cover all 
of the estimated costs to the Government of the 
expected default claims, plus one percent; and 
‘‘(C) loan guarantee fees imposed by the 
Government will be reviewed every six months 
to ensure that the fees imposed on new loan 
guarantees are at a level sufficient to satisfy 
subparagraph (B) based on the most recent es-
timates of such costs. 
‘‘(9) The provisions of any loan guarantee 
under this section shall state that the guarantee is 
conclusive evidence that— 
‘‘(A) the guarantee has been properly ob-
tained; 
‘‘(B) the underlying loan qualified for the 
guarantee; and 
‘‘(C) except in the case of fraud or mate-
rial misrepresentation by the holder of the loan, 
the guarantee will be presumed to be valid, 
legal, and enforceable. 
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‘‘(10) The Secretary may not make any loan or 
loan guarantee under this section unless— 
‘‘(A) the borrower finances at least 25 per-
cent of the funded project from other sources; 
and 
‘‘(B) the borrower uses funds that were 
not derived from Federal loans or loan guaran-
tees to pay the fees or premiums on the loan or 
loan guarantee under this section. 
‘‘(11) The Secretary— 
‘‘(A) shall prescribe explicit standards for 
use in periodically assessing the credit risk of 
new and existing direct loans and guaranteed 
loans; and 
‘‘(B) shall not make a loan or loan guar-
antee under this section unless the Secretary 
finds that there is a reasonable assurance of re-
payment. 
‘‘(d) PAYMENT OF LOSSES.— 
‘‘(1) DEFAULT ON GUARANTEED LOANS.—If, as 
a result of a default by a borrower under a loan 
guaranteed under this section, after the holder 
thereof has made such further collection efforts and 
instituted such enforcement proceedings as the Sec-
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retary may require, the Secretary determines that 
the holder has suffered a loss— 
‘‘(A) the Secretary shall pay to such holder 
75 percent of such loss, as specified in the 
guarantee contract; 
‘‘(B) upon making any such payment, the 
Secretary shall be subrogated to all the rights 
of the recipient of the payment; and 
‘‘(C) the Secretary shall be entitled to re-
cover from the borrower the amount of any pay-
ments made pursuant to the guarantee con-
tract. 
‘‘(2) 
REQUIRED
ENFORCE
OF
FEDERAL 
RIGHTS.—The Attorney General of the United 
States shall take such action as may be appropriate 
to enforce any right accruing to the United States 
as a result of the issuance of any guarantee under 
this section. 
‘‘(3) FORBEARANCE.—Nothing in this section 
precludes any forbearance for the benefit of the bor-
rower of a loan that is made or guaranteed under 
this section which is agreed upon by the parties to 
the loan and approved by the Secretary, provided 
that budget authority for any resulting cost to the 
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Government (as defined in section 502(5) of the 
Federal Credit Reform Act of 1990) is available. 
‘‘(e) DEFINITIONS.—In this section: 
‘‘(1) The term ‘qualified psychiatric treatment 
facility’— 
‘‘(A) means a psychiatric hospital (or other 
qualified treatment facility, as determined ap-
propriate by the Secretary) that is able to serve 
patients ages 21 and older that— 
‘‘(i) will provide acute, short-term in-
patient psychiatric treatment services for 
such patients; 
‘‘(ii) will provide outpatient services; 
and 
‘‘(iii) may include a military services 
program to meet the needs of active and 
retired military service members; and 
‘‘(B) excludes a facility that— 
‘‘(i) provides long-term inpatient care; 
‘‘(ii) is a health center (as defined in 
section 330); and 
‘‘(iii) is part of or affiliated with a 
prison (as defined in section 2246 of title 
18, United States Code). 
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‘‘(2) The term ‘qualified substance abuse treat-
ment facility’— 
‘‘(A) means a psychiatric hospital (or other 
qualified treatment facility, as determined ap-
propriate by the Secretary) that is able to serve 
patients ages 21 and older that— 
‘‘(i) will provide acute, short-term in-
patient substance abuse treatment services 
for such patients; 
‘‘(ii) will provide outpatient services; 
and 
‘‘(iii) may include a military services 
program to meet the needs of active and 
retired military service members; and 
‘‘(B) excludes any facility described in 
paragraph (1)(B). 
‘‘(3) The term ‘psychiatric hospital’ means— 
‘‘(A) an institution that— 
‘‘(i) is primarily engaged in providing, 
by or under the supervision of one or more 
physicians, psychiatric services for the di-
agnosis and treatment of mentally ill per-
sons or those suffering from substance 
abuse disorders; 
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‘‘(ii) satisfies the requirements of 
paragraphs (3) through (9) of subsection 
(e) of section 1861 of the Social Security 
Act; 
‘‘(iii) maintains clinical records on all 
patients and maintains such records as the 
Secretary finds to be necessary to deter-
mine the degree and intensity of the treat-
ment provided to individuals entitled to 
hospital insurance benefits under part A of 
title XVIII of the Social Security Act; and 
‘‘(iv) meets such staffing requirements 
as the Secretary finds necessary for the in-
stitution to carry out an active program of 
treatment for individuals who are fur-
nished services in the institution; or 
‘‘(B) a distinct part of an institution that 
satisfies clauses (i) and (ii) of subparagraph 
(A) if such distinct part satisfies clauses (iii) 
and (iv) of subparagraph (A). 
‘‘(f) FUNDING LIMITATIONS.—The Secretary may 
provide loans and loan guarantees under this section— 
‘‘(1) only to the extent or in the amounts pro-
vided in advance in appropriation Acts; and 
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‘‘(2) totaling not more than $200,000,000 in 
each of fiscal years 2018 through 2022.’’. 
SEC. 3. MENTAL HEALTH AND SUBSTANCE USE TREAT-
MENT TRUST FUND. 
(a) ESTABLISHMENT.—There is established in the 
Treasury of the United States a trust fund to be known 
as the Mental Health and Substance Use Treatment Trust 
Fund (in this section referred to as the ‘‘Trust Fund’’). 
(b) DEPOSITS.—There are hereby authorized to be 
appropriated to the Trust Fund, to remain available until 
expended, amounts equivalent to any revenues from the 
program of loans and loan guarantees under section 
399V–7 of the Public Health Service Act, as added by sec-
tion 2, that exceed the costs of carrying out such program. 
(c) USE OF FUND.—Amounts in the Trust Fund 
shall be available, as provided by appropriation Acts, for 
block grants for community mental health services under 
subpart I of part B of title XIX of the Public Health Serv-
ice Act (42 U.S.C. 300x et seq.). 
SEC. 4. SENSE OF CONGRESS. 
It is the sense of Congress that reversing the Federal 
policy of denying Federal financial participation under the 
Medicaid program for care and services for patients in an 
institution for mental diseases is critically important to 
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improving access to mental health care services and treat-
ment. 
Æ 
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