42 U.S.C. § 256h (THE PUBLIC HEALTH AND WELFARE)
§ 256h. Program of payments to teaching health centers that operate graduate medical education programs
(a) Payments
(1) In general
Subject to subsection (h)(2), the Secretary shall make payments under this section for direct expenses and indirect expenses to qualified teaching health centers that are listed as sponsoring institutions by the relevant accrediting body for, as appropriate—
(A) maintenance of filled positions at existing approved graduate medical residency training programs;
(B) expansion of existing approved graduate medical residency training programs; and
(C) establishment of new approved graduate medical residency training programs.
(2) Per resident amount
In making payments under paragraph (1), the Secretary shall consider the cost of training residents at teaching health centers and the implications of the per resident amount on approved graduate medical residency training programs at teaching health centers.
(3) Priority
In making payments under paragraph (1)(C), the Secretary shall give priority to qualified teaching health centers that—
(A) serve a health professional shortage area with a designation in effect under section 254e of this title or a medically underserved community (as defined in section 295p of this title); or
(B) are located in a rural area (as defined in section 1395ww(d)(2)(D) of this title).
(b) Amount of payments
(1) In general
Subject to paragraph (2), the amounts payable under this section to qualified teaching health centers for an approved graduate medical residency training program for a fiscal year are each of the following amounts:
(A) Direct expense amount
The amount determined under subsection (c) for direct expenses associated with sponsoring approved graduate medical residency training programs.
(B) Indirect expense amount
The amount determined under subsection (d) for indirect expenses associated with the additional costs relating to teaching residents in such programs.
(2) Capped amount
(A) In general
The total of the payments made to qualified teaching health centers under paragraph (1)(A) or paragraph (1)(B) in a fiscal year shall not exceed the amount of funds appropriated under subsection (g) for such payments for that fiscal year.
(B) Limitation
The Secretary shall limit the funding of full-time equivalent residents in order to ensure the direct and indirect payments as determined under subsection 1 (c) and (d) do not exceed the total amount of funds appropriated in a fiscal year under subsection (g).
(C) Addition
Notwithstanding any provision of this section, for the period beginning on October 1, 2023, and ending on December 31, 2024, the Secretary may use any amounts made available in any fiscal year to carry out this section (including amounts recouped under subsection (f)) to make payments described in paragraphs (1)(A) and (1)(B), in addition to the total amount of funds appropriated under subsection (g).
(c) Amount of payment for direct graduate medical education
(1) In general
The amount determined under this subsection for payments to qualified teaching health centers for direct graduate expenses relating to approved graduate medical residency training programs for a fiscal year is equal to the product of—
(A) the updated national per resident amount for direct graduate medical education, as determined under paragraph (2); and
(B) the average number of full-time equivalent residents in the teaching health center’s graduate approved medical residency training programs as determined under section 1395ww(h)(4) of this title (without regard to the limitation under subparagraph (F) of such section) during the fiscal year.
(2) Updated national per resident amount for direct graduate medical education
The updated per resident amount for direct graduate medical education for a qualified teaching health center for a fiscal year is an amount determined as follows:
(A) Determination of qualified teaching health center per resident amount
The Secretary shall compute for each individual qualified teaching health center a per resident amount—
(i) by dividing the national average per resident amount computed under section 256e(c)(2)(D) of this title into a wage-related portion and a non-wage related portion by applying the proportion determined under subparagraph (B);
(ii) by multiplying the wage-related portion by the factor applied under section 1395ww(d)(3)(E) of this title (but without application of section 4410 of the Balanced Budget Act of 1997 (42 U.S.C. 1395ww note)) during the preceding fiscal year for the teaching health center’s area; and
(iii) by adding the non-wage-related portion to the amount computed under clause (ii).
(B) Updating rate
The Secretary shall update such per resident amount for each such qualified teaching health center as determined appropriate by the Secretary.
(d) Amount of payment for indirect medical education
(1) In general
The amount determined under this subsection for payments to qualified teaching health centers for indirect expenses associated with the additional costs of teaching residents for a fiscal year is equal to an amount determined appropriate by the Secretary.
(2) Factors
In determining the amount under paragraph (1), the Secretary shall—
(A) evaluate indirect training costs relative to supporting a primary care residency program in qualified teaching health centers; and
(B) based on this evaluation, assure that the aggregate of the payments for indirect expenses under this section and the payments for direct graduate medical education as determined under subsection (c) in a fiscal year do not exceed the amount appropriated for such expenses as determined in subsection (g).
(3) Interim payment
Before the Secretary makes a payment under this subsection pursuant to a determination of indirect expenses under paragraph (1), the Secretary may provide to qualified teaching health centers a payment, in addition to any payment made under subsection (c), for expected indirect expenses associated with the additional costs of teaching residents for a fiscal year, based on an estimate by the Secretary.
(e) Clarification regarding relationship to other payments for graduate medical education
Payments under this section—
(1) shall be in addition to any payments—
(A) for the indirect costs of medical education under section 1395ww(d)(5)(B) of this title;
(B) for direct graduate medical education costs under section 1395ww(h) of this title; and
(C) for direct costs of medical education under section 1395ww(k) of this title;
(2) shall not be taken into account in applying the limitation on the number of total full-time equivalent residents under subparagraphs (F) and (G) of section 1395ww(h)(4) of this title and clauses (v), (vi)(I), and (vi)(II) of section 1395ww(d)(5)(B) of this title for the portion of time that a resident rotates to a hospital; and
(3) shall not include the time in which a resident is counted toward full-time equivalency by a hospital under paragraph (2) or under section 1395ww(d)(5)(B)(iv) of this title, section 1395ww(h)(4)(E) of this title, or section 256e of this title.
(f) Reconciliation
The Secretary shall determine any changes to the number of residents reported by a teaching health center in the application of the teaching health center for the current fiscal year to determine the final amount payable to the teaching health center for the current fiscal year for both direct expense and indirect expense amounts. Based on such determination, the Secretary shall recoup any overpayments made to pay any balance due to the extent possible. The final amount so determined shall be considered a final intermediary determination for the purposes of section 1395oo of this title and shall be subject to administrative and judicial review under that section in the same manner as the amount of payment under section 1395ww(d) 2 of this title is subject to review under such section.
(g) Funding
(1) In general
To carry out this section, there are appropriated such sums as may be necessary, to remain available until expended, not to exceed—
(A) $230,000,000, for the period of fiscal years 2011 through 2015;
(B) $60,000,000 for each of fiscal years 2016 and 2017;
(C) $126,500,000 for each of fiscal years 2018 through 2023;
(D) $16,635,616 for the period beginning on October 1, 2023, and ending on November 17, 2023, $21,834,247 for the period beginning on November 18, 2023, and ending on January 19, 2024, $16,982,192 for the period beginning on January 20, 2024, and ending on March 8, 2024, and $164,136,986 for the period beginning on October 1, 2023,3 and ending on December 31, 2024;
(E) $43,150,685 for the period beginning on January 1, 2025, and ending on March 31, 2025;
(F) $87,739,726 for the period beginning on April 1, 2025, and ending on September 30, 2025; and
(G) $58,493,151 for the period beginning on October 1, 2025, and ending on January 30, 2026.
(2) Administrative expenses
Of the amount made available to carry out this section for any fiscal year, the Secretary may not use more than 5 percent of such amount for the expenses of administering this section.
(h) Annual reporting required
(1) Annual report
The report required under this paragraph for a qualified teaching health center for a fiscal year is a report that includes (in a form and manner specified by the Secretary) the following information for the residency academic year completed immediately prior to such fiscal year:
(A) The types of primary care resident approved training programs that the qualified teaching health center provided for residents.
(B) The number of approved training positions for residents described in paragraph (4).
(C) The number of residents described in paragraph (4) who completed their residency training at the end of such residency academic year and care for vulnerable populations living in underserved areas.
(D) The number of patients treated by residents described in paragraph (4).
(E) The number of visits by patients treated by residents described in paragraph (4).
(F) Of the number of residents described in paragraph (4) who completed their residency training at the end of such residency academic year, the number and percentage of such residents entering primary care practice (meaning any of the areas of practice listed in the definition of a primary care residency program in section 293l–1 of this title).
(G) Of the number of residents described in paragraph (4) who completed their residency training at the end of such residency academic year, the number and percentage of such residents who entered practice at a health care facility—
(i) primarily serving a health professional shortage area with a designation in effect under section 254e of this title or a medically underserved community (as defined in section 295p of this title); or
(ii) located in a rural area (as defined in section 1395ww(d)(2)(D) of this title).
(H) Other information as deemed appropriate by the Secretary.
(2) Audit authority; limitation on payment
(A) Audit authority
The Secretary may audit a qualified teaching health center to ensure the accuracy and completeness of the information submitted in a report under paragraph (1).
(B) Limitation on payment
A teaching health center may only receive payment in a cost reporting period for a number of such resident positions that is greater than the base level of primary care resident positions, as determined by the Secretary. For purposes of this subparagraph, the “base level of primary care residents” for a teaching health center is the level of such residents as of a base period.
(3) Reduction in payment for failure to report
(A) In general
The amount payable under this section to a qualified teaching health center for a fiscal year shall be reduced by at least 25 percent if the Secretary determines that—
(i) the qualified teaching health center has failed to provide the Secretary, as an addendum to the qualified teaching health center’s application under this section for such fiscal year, the report required under paragraph (1) for the previous fiscal year; or
(ii) such report fails to provide complete and accurate information required under any subparagraph of such paragraph.
(B) Notice and opportunity to provide accurate and missing information
Before imposing a reduction under subparagraph (A) on the basis of a qualified teaching health center’s failure to provide complete and accurate information described in subparagraph (A)(ii), the Secretary shall provide notice to the teaching health center of such failure and the Secretary’s intention to impose such reduction and shall provide the teaching health center with the opportunity to provide the required information within the period of 30 days beginning on the date of such notice. If the teaching health center provides such information within such period, no reduction shall be made under subparagraph (A) on the basis of the previous failure to provide such information.
(4) Residents
The residents described in this paragraph are those who are in part-time or full-time equivalent resident training positions at a qualified teaching health center in any approved graduate medical residency training program.
(i) Regulations
The Secretary shall promulgate regulations to carry out this section.
(j) Definitions
In this section:
(1) Approved graduate medical residency training program
The term “approved graduate medical residency training program” means a residency or other postgraduate medical training program—
(A) participation in which may be counted toward certification in a specialty or subspecialty and includes formal postgraduate training programs in geriatric medicine approved by the Secretary; and
(B) that meets criteria for accreditation (as established by the Accreditation Council for Graduate Medical Education, the American Osteopathic Association, or the American Dental Association).
(2) New approved graduate medical residency training program
The term “new approved graduate medical residency training program” means an approved graduate medical residency training program for which the sponsoring qualified teaching health center has not received a payment under this section for a previous fiscal year (other than pursuant to subsection (a)(1)(C)).
(3) Primary care residency program
The term “primary care residency program” has the meaning given that term in section 293l–1 of this title.
(4) Qualified teaching health center
The term “qualified teaching health center” has the meaning given the term “teaching health center” in section 293l–1 of this title.
(July 1, 1944, ch. 373, title III, § 340H, as added Pub. L. 111–148, title V, § 5508(c), Mar. 23, 2010, 124 Stat. 670; amended Pub. L. 114–10, title II, § 221(b), Apr. 16, 2015, 129 Stat. 154; Pub. L. 115–63, title III, § 301(a), Sept. 29, 2017, 131 Stat. 1171; Pub. L. 115–96, div. C, title I, § 3101(c), Dec. 22, 2017, 131 Stat. 2048; Pub. L. 115–123, div. E, title IX, § 50901(d)(1)–(3), (5), (6), Feb. 9, 2018, 132 Stat. 287–289; Pub. L. 116–59, div. B, title I, § 1101(c), Sept. 27, 2019, 133 Stat. 1102; Pub. L. 116–69, div. B, title I, § 1101(c), Nov. 21, 2019, 133 Stat. 1136; Pub. L. 116–94, div. N, title I, § 401(c), Dec. 20, 2019, 133 Stat. 3113; Pub. L. 116–136, div. A, title III, § 3831(c), Mar. 27, 2020, 134 Stat. 434; Pub. L. 116–159, div. C, title I, § 2101(c), Oct. 1, 2020, 134 Stat. 728; Pub. L. 116–215, div. B, title II, § 1201(c), Dec. 11, 2020, 134 Stat. 1044; Pub. L. 116–260, div. BB, title III, § 301(c), Dec. 27, 2020, 134 Stat. 2922; Pub. L. 118–15, div. B, title III, § 2321(a), Sept. 30, 2023, 137 Stat. 94; Pub. L. 118–22, div. B, title II, § 201(a), Nov. 17, 2023, 137 Stat. 119; Pub. L. 118–35, div. B, title I, § 101(a), Jan. 19, 2024, 138 Stat. 4; Pub. L. 118–42, div. G, title I, § 101(c)(1), (2), Mar. 9, 2024, 138 Stat. 397; Pub. L. 118–158, div. C, title I, § 3101(c), Dec. 21, 2024, 138 Stat. 1762; Pub. L. 119–4, div. B, title I, § 2101(c), Mar. 15, 2025, 139 Stat. 40; Pub. L. 119–37, div. F, title I, § 6101(c), Nov. 12, 2025, 139 Stat. 629.)
heading: Editorial Notes
heading: References in Text
text: Section 4410 of the Balanced Budget Act of 1997, referred to in subsec. (c)(2)(A)(ii), is section 4410 of Pub. L. 105–33, which is set out as a note under section 1395ww of this title.
Section 1395ww(d) of this title, referred to in subsec. (f), was in the original “section 1186(d) of such Act”, and was translated as meaning section 1886(d) of act Aug. 14, 1935, ch. 531, known as the Social Security Act, to reflect the probable intent of Congress. The Social Security Act does not contain a section 1186.
heading: Codification
text: Another section 340H of act July 1, 1944, was renumbered section 340I and is classified to section 256i of this title.
heading: Amendments
text: 2025—Subsec. (g)(1)(F). Pub. L. 119–4 added subpar. (F).
Subsec. (g)(1)(G). Pub. L. 119–37 added subpar. (G).
2024—Subsec. (b)(2)(C). Pub. L. 118–42, § 101(c)(2), added subpar. (C).
Subsec. (g)(1). Pub. L. 118–158, § 3101(c)(2), substituted “, not to exceed—” and subpars. (A) to (E) for period at end.
Pub. L. 118–158, § 3101(c)(1), struck out “not to exceed $230,000,000, for the period of fiscal years 2011 through 2015, $60,000,000 for each of fiscal years 2016 and 2017, $126,500,000 for each of fiscal years 2018 through 2023, $16,635,616 for the period beginning on October 1, 2023, and ending on November 17, 2023, $21,834,247 for the period beginning on November 18, 2023, and ending on January 19, 2024, $16,982,192 for the period beginning on January 20, 2024, and ending on March 8, 2024, and $164,136,986 for the period beginning on October 1, 2023, and ending on December 31, 2024,” after “as may be necessary,”.
Pub. L. 118–42, § 101(c)(1), substituted “$16,982,192 for the period beginning on January 20, 2024, and ending on March 8, 2024, and $164,136,986 for the period beginning on October 1, 2023, and ending on December 31, 2024” for “and $16,982,192 for the period beginning on January 20, 2024, and ending on March 8, 2024”.
Pub. L. 118–35 substituted “$21,834,247 for the period beginning on November 18, 2023, and ending on January 19, 2024, and $16,982,192 for the period beginning on January 20, 2024, and ending on March 8, 2024” for “and $21,834,247 for the period beginning on November 18, 2023, and ending on January 19, 2024”.
2023—Subsec. (g)(1). Pub. L. 118–22 substituted “$16,635,616 for the period beginning on October 1, 2023, and ending on November 17, 2023, and $21,834,247 for the period beginning on November 18, 2023, and ending on January 19, 2024” for “and $16,635,616 for the period beginning on October 1, 2023, and ending on November 17, 2023”.
Pub. L. 118–15 struck out “and” before “$126,500,000” and inserted “and $16,635,616 for the period beginning on October 1, 2023, and ending on November 17, 2023,” before “to remain available”.
2020—Subsec. (g)(1). Pub. L. 116–260 inserted “and” after “2017,” and substituted “2023” for “fiscal year 2020, and $27,379,452 for the period beginning on October 1, 2020, and ending on December 18, 2020”.
Pub. L. 116–215 substituted “$27,379,452” for “$24,953,425” and “December 18, 2020” for “December 11, 2020”.
Pub. L. 116–159 substituted “$24,953,425” for “$21,141,096” and “December 11, 2020” for “November 30, 2020”.
Pub. L. 116–136 substituted “through fiscal year 2020, and $21,141,096 for the period beginning on October 1, 2020, and ending on November 30, 2020” for “and 2019, and $81,445,205 for the period beginning on October 1, 2019, and ending on May 22, 2020”.
2019—Subsec. (g)(1). Pub. L. 116–94 substituted “$81,445,205” for “$28,072,603” and “May 22, 2020” for “December 20, 2019”.
Pub. L. 116–69 substituted “$28,072,603” for “$18,021,918” and “December 20, 2019” for “November 21, 2019”.
Pub. L. 116–59 struck out “and” before “$126,500,000” and inserted “and $18,021,918 for the period beginning on October 1, 2019, and ending on November 21, 2019,” before “to remain available”.
2018—Subsec. (a). Pub. L. 115–123, § 50901(d)(1), amended subsec. (a) generally. Prior to amendment, text read as follows: “Subject to subsection (h)(2), the Secretary shall make payments under this section for direct expenses and for indirect expenses to qualified teaching health centers that are listed as sponsoring institutions by the relevant accrediting body for expansion of existing or establishment of new approved graduate medical residency training programs.”
Subsec. (f). Pub. L. 115–123, § 50901(d)(6), substituted “teaching health center” for “hospital” wherever appearing.
Subsec. (g)(1). Pub. L. 115–123, § 50901(d)(2), substituted “and $126,500,000 for each of fiscal years 2018 and 2019,” for “and $30,000,000 for the period of the first and second quarters of fiscal year 2018,”.
Subsec. (h)(1)(D) to (H). Pub. L. 115–123, § 50901(d)(3), added subpars. (D) to (G) and redesignated former subpar. (D) as (H).
Subsec. (j)(2) to (4). Pub. L. 115–123, § 50901(d)(5), added par. (2) and redesignated former pars. (2) and (3) as (3) and (4), respectively.
2017—Subsec. (g). Pub. L. 115–96 designated existing provisions as par. (1), inserted heading, substituted “and $30,000,000 for the period of the first and second quarters of fiscal year 2018, to remain available until expended” for “and $15,000,000 for the first quarter of fiscal year 2018”, and added par. (2).
Pub. L. 115–63 substituted “2015, $60,000,000” for “2015 and $60,000,000” and inserted “, and $15,000,000 for the first quarter of fiscal year 2018” before period at end.
2015—Subsec. (g). Pub. L. 114–10 inserted “and $60,000,000 for each of fiscal years 2016 and 2017” before period at end.
heading: Statutory Notes and Related Subsidiaries
heading: Funding for Teaching Health Centers That Operate Graduate Medical Education
text: Pub. L. 117–2, title II, § 2604, Mar. 11, 2021, 135 Stat. 44, provided that:
“(a) In General.—
In addition to amounts otherwise available, and notwithstanding the capped amount referenced in sections 340H(b)(2) and 340H(d)(2) of the Public Health Service Act (42 U.S.C. 256h(b)(2) and (d)(2)), there is appropriated to the Secretary [of Health and Human Services] for fiscal year 2021, out of any money in the Treasury not otherwise appropriated, $330,000,000, to remain available until September 30, 2023, for the program of payments to teaching health centers that operate graduate medical education under section 340H of the Public Health Service Act (42 U.S.C. 256h) and for teaching health center development grants authorized under section 749A of the Public Health Service Act (42 U.S.C. 293l–1).
“(b) Use of Funds.—
Amounts made available pursuant to subsection (a) shall be used for the following activities:
“(1) For making payments to establish new approved graduate medical residency training programs pursuant to section 340H(a)(1)(C) of the Public Health Service Act (42 U.S.C. 256h(a)(1)(C)).
“(2) To provide an increase to the per resident amount described in section 340H(a)(2) of the Public Health Service Act (42 U.S.C. 256h(a)(2)) of $10,000.
“(3) For making payments under section 340H(a)(1)(A) of the Public Health Service Act (42 U.S.C. 256h(a)(1)(A))) [sic] to qualified teaching health centers for maintenance of filled positions at existing approved graduate medical residency training programs.
“(4) For making payments under section 340H(a)(1)(B) of the Public Health Service Act (42 U.S.C. 256h(a)(1)(B)) for the expansion of existing approved graduate medical residency training programs.
“(5) For making awards under section 749A of the Public Health Service Act (42 U.S.C. 293l–1) to teaching health centers for the purpose of establishing new accredited or expanded primary care residency programs.
“(6) To cover administrative costs and activities necessary for qualified teaching health centers receiving payments under section 340H of the Public Health Service Act (42 U.S.C. 256h) to carry out activities under such section.”
heading: Payments for Previous Fiscal Years
text: Pub. L. 115–123, div. E, title IX, § 50901(d)(7), Feb. 9, 2018, 132 Stat. 289, provided that: “The provisions of section 340H of the Public Health Service Act (42 U.S.C. 256h), as in effect on the day before the date of enactment of Public Law 115–96 [Dec. 22, 2017], shall continue to apply with respect to payments under such section for fiscal years before fiscal year 2018.”