I
107TH CONGRESS
1ST SESSION
H. R. 1968
To amend the Public Health Service Act and the Internal Revenue Code
of 1986 with respect to the National Health Service Corps.
IN THE HOUSE OF REPRESENTATIVES
MAY 23, 2001
Mrs. MALONEY of New York (for herself, Mr. BOEHLERT, Mr. CAPUANO, Mr.
GILCHREST, Mr. WYNN, Mr. MCHUGH, Mr. GREEN of Texas, Mr. RAN-
GEL, Mr. MCDERMOTT, Mrs. THURMAN, Mr. GORDON, Ms. MCCARTHY
of Missouri, Mr. JEFFERSON, Mr. DAVIS of Illinois, Mr. FROST, Mr.
ROEMER, Mr. DOOLEY of California, Mr. EVANS, Mr. BLAGOJEVICH, Ms.
NORTON, Mr. ABERCROMBIE, Ms. JACKSON-LEE
of Texas, Mrs.
CHRISTENSEN, Mr. STENHOLM, Mr. MCNULTY, Mr. SANDERS, Mr.
FRANK, Mr. CONYERS, Mrs. MINK of Hawaii, Mr. TIERNEY, Ms. MCKIN-
NEY, Ms. BALDWIN, Mr. CUMMINGS, Mrs. JONES of Ohio, Mr. BAIRD,
Mr. NADLER, Mr. MCGOVERN, and Mr. PHELPS) introduced the fol-
lowing bill; which was referred to the Committee on Energy and Com-
merce, and in addition to the Committee on Ways and Means, for a pe-
riod to be subsequently determined by the Speaker, in each case for con-
sideration of such provisions as fall within the jurisdiction of the com-
mittee concerned
A BILL
To amend the Public Health Service Act and the Internal
Revenue Code of 1986 with respect to the National
Health Service Corps.
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 ‘‘National Health Serv-
ice Corps Reinvestment Act of 2001’’.
TITLE I—REVISION AND EXTEN-
SION OF PROGRAM FOR NA-
TIONAL 
HEALTH 
SERVICE
CORPS
SEC. 101. GENERAL PROGRAM.
(a) ADDITIONAL AUTHORIZATIONS OF APPROPRIA-
TIONS.—Section 338(a)(1) of the Public Health Service
Act (42 U.S.C. 254k(a)(1)) is amended by inserting before
the period the following: ‘‘, $62,284,500 for fiscal year
2002, and such sums as may be necessary for each of the
fiscal years 2003 through 2006’’.
(b) DESIGNATION
OF
HEALTH
PROFESSIONAL
SHORTAGE AREAS.—Section 332 of the Public Health
Service Act (42 U.S.C. 254e) is amended by adding at
the end the following subsection:
‘‘(i)(1) Notwithstanding any other provision of this
subpart, the Secretary shall consider facilities described
in paragraph (2) to be health professional shortage areas
within the meaning of subsection (a)(1)(C).
‘‘(2) The facilities referred to in paragraph (1) are
public or nonprofit private facilities that are any of the
following:
‘‘(A) A health center receiving a grant under
section 330.
‘‘(B) A Federally-qualified health center as de-
fined in section 1905(l)(2)(B) of the Social Security
Act.
‘‘(C) A rural health clinic under section
1861(aa)(2) of the Social Security Act.’’.
(c) STRIKING
OF PROVISIONS REGARDING COST
SHARING.—Subpart II of part D of title III of the Public
Health Service Act (42 U.S.C. 254d et seq.) is amended
by striking section 334.
SEC. 102. SCHOLARSHIP AND LOAN REPAYMENT PRO-
GRAMS.
(a) ADDITIONAL AUTHORIZATIONS OF APPROPRIA-
TIONS.—Section 338H(b)(1) of the Public Health Service
Act (42 U.S.C. 254q(b)(1)) is amended—
(1) by striking ‘‘and’’ after ‘‘1991,’’; and
(2) by inserting before the period the following:
‘‘, $131,886,000 for fiscal year 2002, and such sums
as may be necessary for each of the fiscal years
2003 through 2006’’.
(b) DEMONSTRATION PROGRAM REGARDING PART-
TIME PERFORMANCE OF OBLIGATED SERVICE.—Section
338C (42 U.S.C. 254m) of the Public Health Service Act
is amended by adding at the end the following subsection:
‘‘(f)(1) In carrying out this subpart, the Secretary
may in accordance with this subsection carry out dem-
onstration projects in which individuals who have entered
into contracts under section 338A or 338B receive a waiv-
er under which the individuals are authorized, notwith-
standing subsection (a), to satisfy the requirement of obli-
gated service through providing clinical service that is not
full-time (referred to in this subsection as ‘part-time serv-
ice’).
‘‘(2) A waiver under paragraph (1) may be provided
by the Secretary only if the following conditions are met:
‘‘(A) An entity approved under section 333 for
the assignment of a Corps member has requested in
writing that the Corps member assigned to the enti-
ty provide part-time service.
‘‘(B) The Secretary has determined that part-
time service by a Corp member is appropriate for
the health professional shortage area in which the
entity is located.
‘‘(C) A Corps member who is required to per-
form obligated service has agreed in writing to be
assigned, for part-time service, to an entity de-
scribed in subparagraph (A).
‘‘(D) The entity and the Corps member agree
in writing that the part-time service provided by the
Corps member will be not less than 20 hours per
week.
‘‘(E) The Corps member agrees in writing that
the period of time over which the Corps member
would otherwise have performed obligated service
pursuant to section 338A or 338B (as applicable)
will be extended so that the aggregate amount of
part-time service provided by the Corps member will
equal the period of obligated service that otherwise
would have applied pursuant to such section.
‘‘(F) The Corps member agrees in writing that,
if the Corps member begins providing part-time
service but fails to complete the period of obligated
service, the method of determining the amount of
damages described in subsection (b) or (c) of section
338E, as applicable, will be applied by using the
full-time equivalent of the part-time service provided
by the Corp member.’’.
TITLE 
II—EXCLUSION 
FROM
GROSS INCOME FOR CERTAIN
SCHOLARSHIPS 
AND 
LOAN
PAYMENTS UNDER NATIONAL
HEALTH 
SERVICE 
CORPS
PROGRAM
SEC. 201. EXCLUSION OF AMOUNTS RECEIVED UNDER THE
NATIONAL HEALTH SERVICE CORPS SCHOL-
ARSHIP PROGRAM.
(a) IN GENERAL.—Section 117(c) of the Internal
Revenue Code of 1986 (relating to the exclusion from
gross income amounts received as a qualified scholarship)
is amended—
(1) by striking ‘‘Subsections (a)’’ and inserting
the following:
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), subsections (a)’’; and
(2) by adding at the end the following new
paragraph:
‘‘(2) EXCEPTION.—Paragraph (1) shall not
apply to any amount received by an individual under
the National Health Service Corps Scholarship Pro-
gram under section 338A(g)(1)(A) of the Public
Health Service Act.’’