‘‘(D) a statement of the damages to which 
the United States is entitled under subsection 
(l) for the individual’s breach of the contract; 
and 
‘‘(E) such other statements of the rights 
and liabilities of the Secretary and of the indi-
vidual, not inconsistent with this section. 
‘‘(f) DEADLINE FOR DECISION ON APPLICATION.— 
The Secretary shall provide written notice to an individual 
within 21 days on— 
‘‘(1) the Secretary’s approving, under sub-
section (e)(1), of the individual’s participation in the 
Loan Repayment Program, including extensions re-
sulting in an aggregate period of obligated service in 
excess of 4 years; or 
‘‘(2) the Secretary’s disapproving an individ-
ual’s participation in such Program. 
‘‘(g) PAYMENTS.— 
‘‘(1) IN GENERAL.—A loan repayment provided 
for an individual under a written contract under the 
Loan Repayment Program shall consist of payment, 
in accordance with paragraph (2), on behalf of the 
individual of the principal, interest, and related ex-
penses on government and commercial loans received 
by the individual regarding the undergraduate or 
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CCOLEMAN on PROD1PC71 with BILLS
graduate education of the individual (or both), which 
loans were made for— 
‘‘(A) tuition expenses; 
‘‘(B) all other reasonable educational ex-
penses, including fees, books, and laboratory ex-
penses, incurred by the individual; and 
‘‘(C) reasonable living expenses as deter-
mined by the Secretary. 
‘‘(2) AMOUNT.—For each year of obligated 
service that an individual contracts to serve under 
subsection (e), the Secretary may pay up to $35,000 
or an amount equal to the amount specified in sec-
tion 338B(g)(2)(A) of the Public Health Service 
Act, whichever is more, on behalf of the individual 
for loans described in paragraph (1). In making a 
determination of the amount to pay for a year of 
such service by an individual, the Secretary shall 
consider the extent to which each such determina-
tion— 
‘‘(A) affects the ability of the Secretary to 
maximize the number of contracts that can be 
provided under the Loan Repayment Program 
from the amounts appropriated for such con-
tracts; 
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CCOLEMAN on PROD1PC71 with BILLS
‘‘(B) provides an incentive to serve in In-
dian Health Programs and Urban Indian Orga-
nizations with the greatest shortages of health 
professionals; and 
‘‘(C) provides an incentive with respect to 
the health professional involved remaining in an 
Indian Health Program or Urban Indian Orga-
nization with such a health professional short-
age, and continuing to provide primary health 
services, after the completion of the period of 
obligated service under the Loan Repayment 
Program. 
‘‘(3) TIMING.—Any arrangement made by the 
Secretary for the making of loan repayments in ac-
cordance with this subsection shall provide that any 
repayments for a year of obligated service shall be 
made no later than the end of the fiscal year in 
which the individual completes such year of service. 
‘‘(4) REIMBURSEMENTS FOR TAX LIABILITY.— 
For the purpose of providing reimbursements for tax 
liability resulting from a payment under paragraph 
(2) on behalf of an individual, the Secretary— 
‘‘(A) in addition to such payments, may 
make payments to the individual in an amount 
equal to not less than 20 percent and not more 
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CCOLEMAN on PROD1PC71 with BILLS
than 39 percent of the total amount of loan re-
payments made for the taxable year involved; 
and 
‘‘(B) may make such additional payments 
as the Secretary determines to be appropriate 
with respect to such purpose. 
‘‘(5) PAYMENT
SCHEDULE.—The Secretary 
may enter into an agreement with the holder of any 
loan for which payments are made under the Loan 
Repayment Program to establish a schedule for the 
making of such payments. 
‘‘(h) EMPLOYMENT CEILING.—Notwithstanding any 
other provision of law, individuals who have entered into 
written contracts with the Secretary under this section 
shall not be counted against any employment ceiling af-
fecting the Department while those individuals are under-
going academic training. 
‘‘(i) RECRUITMENT.—The Secretary shall conduct re-
cruiting programs for the Loan Repayment Program and 
other manpower programs of the Service at educational 
institutions training health professionals or specialists 
identified in subsection (a). 
‘‘(j) APPLICABILITY OF LAW.—Section 214 of the 
Public Health Service Act (42 U.S.C. 215) shall not apply 
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CCOLEMAN on PROD1PC71 with BILLS
to individuals during their period of obligated service 
under the Loan Repayment Program. 
‘‘(k) ASSIGNMENT OF INDIVIDUALS.—The Secretary, 
in assigning individuals to serve in Indian Health Pro-
grams or Urban Indian Organizations pursuant to con-
tracts entered into under this section, shall— 
‘‘(1) ensure that the staffing needs of Tribal 
Health Programs and Urban Indian Organizations 
receive consideration on an equal basis with pro-
grams that are administered directly by the Service; 
and 
‘‘(2) give priority to assigning individuals to In-
dian Health Programs and Urban Indian Organiza-
tions that have a need for health professionals to 
provide health care services as a result of individuals 
having breached contracts entered into under this 
section. 
‘‘(l) BREACH OF CONTRACT.— 
‘‘(1) SPECIFIC BREACHES.—An individual who 
has entered into a written contract with the Sec-
retary under this section and has not received a 
waiver under subsection (m) shall be liable, in lieu 
of any service obligation arising under such contract, 
to the United States for the amount which has been 
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CCOLEMAN on PROD1PC71 with BILLS
paid on such individual’s behalf under the contract 
if that individual— 
‘‘(A) is enrolled in the final year of a 
course of study and— 
‘‘(i) fails to maintain an acceptable 
level of academic standing in the edu-
cational institution in which he or she is 
enrolled (such level determined by the edu-
cational institution under regulations of 
the Secretary); 
‘‘(ii) voluntarily terminates such en-
rollment; or 
‘‘(iii) is dismissed from such edu-
cational institution before completion of 
such course of study; or 
‘‘(B) is enrolled in a graduate training pro-
gram and fails to complete such training pro-
gram. 
‘‘(2) 
OTHER
BREACHES; 
FORMULA
FOR 
AMOUNT OWED.—If, for any reason not specified in 
paragraph (1), an individual breaches his or her 
written contract under this section by failing either 
to begin, or complete, such individual’s period of ob-
ligated service in accordance with subsection (e)(2), 
the United States shall be entitled to recover from 
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CCOLEMAN on PROD1PC71 with BILLS
such individual an amount to be determined in ac-
cordance with the following formula: A=3Z(t¥s/t) 
in which— 
‘‘(A) ‘A’ is the amount the United States 
is entitled to recover; 
‘‘(B) ‘Z’ is the sum of the amounts paid 
under this section to, or on behalf of, the indi-
vidual and the interest on such amounts which 
would be payable if, at the time the amounts 
were paid, they were loans bearing interest at 
the maximum legal prevailing rate, as deter-
mined by the Secretary of the Treasury; 
‘‘(C) ‘t’ is the total number of months in 
the individual’s period of obligated service in 
accordance with subsection (f); and 
‘‘(D) ‘s’ is the number of months of such 
period served by such individual in accordance 
with this section. 
‘‘(3) DEDUCTIONS IN MEDICARE PAYMENTS.— 
Amounts not paid within such period shall be sub-
ject to collection through deductions in medicare 
payments pursuant to section 1892 of the Social Se-
curity Act. 
‘‘(4) TIME
PERIOD
FOR
REPAYMENT.—Any 
amount of damages which the United States is enti-
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CCOLEMAN on PROD1PC71 with BILLS
tled to recover under this subsection shall be paid to 
the United States within the 1-year period beginning 
on the date of the breach or such longer period be-
ginning on such date as shall be specified by the 
Secretary. 
‘‘(5) RECOVERY OF DELINQUENCY.— 
‘‘(A) IN GENERAL.—If damages described 
in paragraph (4) are delinquent for 3 months, 
the Secretary shall, for the purpose of recov-
ering such damages— 
‘‘(i) use collection agencies contracted 
with by the Administrator of General Serv-
ices; or 
‘‘(ii) enter into contracts for the re-
covery of such damages with collection 
agencies selected by the Secretary. 
‘‘(B) REPORT.—Each contract for recov-
ering damages pursuant to this subsection shall 
provide that the contractor will, not less than 
once each 6 months, submit to the Secretary a 
status report on the success of the contractor in 
collecting such damages. Section 3718 of title 
31, United States Code, shall apply to any such 
contract to the extent not inconsistent with this 
subsection. 
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CCOLEMAN on PROD1PC71 with BILLS
‘‘(m) WAIVER OR SUSPENSION OF OBLIGATION.— 
‘‘(1) IN GENERAL.—The Secretary shall by reg-
ulation provide for the partial or total waiver or sus-
pension of any obligation of service or payment by 
an individual under the Loan Repayment Program 
whenever compliance by the individual is impossible 
or would involve extreme hardship to the individual 
and if enforcement of such obligation with respect to 
any individual would be unconscionable. 
‘‘(2) CANCELED UPON DEATH.—Any obligation 
of an individual under the Loan Repayment Pro-
gram for service or payment of damages shall be 
canceled upon the death of the individual. 
‘‘(3) HARDSHIP WAIVER.—The Secretary may 
waive, in whole or in part, the rights of the United 
States to recover amounts under this section in any 
case of extreme hardship or other good cause shown, 
as determined by the Secretary. 
‘‘(4) BANKRUPTCY.—Any obligation of an indi-
vidual under the Loan Repayment Program for pay-
ment of damages may be released by a discharge in 
bankruptcy under title 11 of the United States Code 
only if such discharge is granted after the expiration 
of the 5-year period beginning on the first date that 
payment of such damages is required, and only if 
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CCOLEMAN on PROD1PC71 with BILLS
the bankruptcy court finds that nondischarge of the 
obligation would be unconscionable. 
‘‘(n) REPORT.—The Secretary shall submit to the 
President, for inclusion in the report required to be sub-
mitted to Congress under section 801, a report concerning 
the previous fiscal year which sets forth by Service Area 
the following: 
‘‘(1) A list of the health professional positions 
maintained by Indian Health Programs and Urban 
Indian Organizations for which recruitment or reten-
tion is difficult. 
‘‘(2) The number of Loan Repayment Program 
applications filed with respect to each type of health 
profession. 
‘‘(3) The number of contracts described in sub-
section (e) that are entered into with respect to each 
health profession. 
‘‘(4) The amount of loan payments made under 
this section, in total and by health profession. 
‘‘(5) The number of scholarships that are pro-
vided under sections 104 and 106 with respect to 
each health profession. 
‘‘(6) The amount of scholarship grants provided 
under section 104 and 106, in total and by health 
profession. 
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