amounts of tuition and other reasonable educational 
expenses described in subparagraph (A) and (B) of 
paragraph (1). Payment to such institution may be 
made without regard to section 3324(a) and (b) of 
title 31. 
‘‘(3) STIPEND.—The amount of the monthly 
stipend described in paragraph (1)(C) shall be in-
creased by the Secretary for each school year ending 
in a fiscal year beginning after September 30, 2011, 
by an amount (rounded to the next highest multiple 
of $1) equal to the amount of such stipend multi-
plied by the overall percentage (under section 5303 
of title 5) of the adjustment (if such adjustment is 
an increase) in the rates of pay under the General 
Schedule made effective in the fiscal year in which 
such school year ends. 
‘‘(e) LIABILITY; FAILURE TO COMPLETE THE PE-
RIOD OF OBLIGATED SERVICE; REPAYMENT.— 
‘‘(1) LIABILITY.—An individual who has en-
tered into a written contract with the Secretary 
under this section shall be liable to the United 
States for the amount which has been paid to, or on 
behalf of, such individual under the contract, if such 
individual— 
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‘‘(A) fails to maintain an acceptable level 
of academic standing in the institution of high-
er education in which the individual is enrolled 
(as determined by the Secretary taking into ac-
count the requirements of the educational insti-
tution offering such course of study); 
‘‘(B) is dismissed from such institution of 
higher education for disciplinary reasons; 
‘‘(C) voluntarily terminates the training in 
such institution of higher education for which 
such individual is provided a scholarship under 
such contract before the completion of such 
training; or 
‘‘(D) fails to accept payment, or instructs 
the institution of higher education in which 
such individual is enrolled not to accept pay-
ment, under this section. 
‘‘(2) FAILURE TO COMPLETE THE PERIOD OF 
OBLIGATED SERVICE.— 
‘‘(A) IN GENERAL.—Subject to paragraph 
(C), if for any reason not specified in paragraph 
(1), an individual breaches the written contract 
under this section by failing either to begin 
such individual’s period of obligated service or 
failing to complete such obligation, the United 
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States shall be entitled to recover from the indi-
vidual an amount determined in accordance 
with the following formula: 
‘‘A = 3Z(t–s/t) 
‘‘in which— 
‘‘(i) ‘A’ is the amount the United States is 
entitled to recover; 
‘‘(ii) ‘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 Treasurer of the United States; 
‘‘(iii) ‘t’ is the total number of months in 
the individual’s period of obligated service in 
accordance with subsection (c)(2) of this sec-
tion; and 
‘‘(iv) ‘s’ is the number of months of such 
period served by such individual in accordance 
with this section. 
‘‘(B) AMOUNTS NOT PAID.—Amounts not paid 
within such period shall be subject to collection 
through deductions in Medicare payments pursuant 
to section 1395ccc of title 42. 
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