[104th Congress Public Law 299]
[From the U.S. Government Printing Office]
<DOC>
[DOCID: f:publ299.104]
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HEALTH CENTERS CONSOLIDATION ACT OF 1996
[[Page 110 STAT. 3626]]
Public Law 104-299
104th Congress
An Act
To amend title III of the Public Health Service Act to consolidate and
reauthorize provisions relating to health centers, and for other
purposes. <<NOTE: Oct. 11, 1996 - [S. 1044]>>
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress <<NOTE: Health Centers
Consolidation Act of 1996.>> assembled,
SECTION 1. <<NOTE: 42 USC 201 note.>> SHORT TITLE.
This Act may be cited as the ``Health Centers Consolidation Act of
1996''.
SEC. 2. CONSOLIDATION AND REAUTHORIZATION OF PROVISIONS.
Subpart I of part D of title III of the Public Health Service Act
(42 U.S.C. 254b et seq.) is amended to read as follows:
``Subpart I--Health Centers
``SEC. 330. <<NOTE: 42 USC 254b.>> HEALTH CENTERS.
``(a) Definition of Health Center.--
``(1) In general.--For purposes of this section, the term
`health center' means an entity that serves a population that is
medically underserved, or a special medically underserved
population comprised of migratory and seasonal agricultural
workers, the homeless, and residents of public housing, by
providing, either through the staff and supporting resources of
the center or through contracts or cooperative arrangements--
``(A) required primary health services (as defined
in subsection (b)(1)); and
``(B) as may be appropriate for particular centers,
additional health services (as defined in subsection
(b)(2)) necessary for the adequate support of the
primary health services required under subparagraph (A);
for all residents of the area served by the center (hereafter
referred to in this section as the `catchment area').
``(2) Limitation.--The requirement in paragraph (1) to
provide services for all residents within a catchment area shall
not apply in the case of a health center receiving a grant only
under subsection (g), (h), or (i).
``(b) Definitions.--For purposes of this section:
``(1) Required primary health services.--
``(A) In general.--The term `required primary health
services' means--
``(i) basic health services which, for
purposes of this section, shall consist of--
[[Page 110 STAT. 3627]]
``(I) health services related to
family medicine, internal medicine,
pediatrics, obstetrics, or gynecology
that are furnished by physicians and
where appropriate, physician assistants,
nurse practitioners, and nurse midwives;
``(II) diagnostic laboratory and
radiologic services;
``(III) preventive health services,
including--
``(aa) prenatal and
perinatal services;
``(bb) screening for breast
and cervical cancer;
``(cc) well-child services;
``(dd) immunizations against
vaccine-preventable diseases;
``(ee) screenings for
elevated blood lead levels,
communicable diseases, and
cholesterol;
``(ff) pediatric eye, ear,
and dental screenings to
determine the need for vision
and hearing correction and
dental care;
``(gg) voluntary family
planning services; and
``(hh) preventive dental
services;
``(IV) emergency medical services;
and
``(V) pharmaceutical services as may
be appropriate for particular centers;
``(ii) referrals to providers of medical
services and other health-related services
(including substance abuse and mental health
services);
``(iii) patient case management services
(including counseling, referral, and follow-up
services) and other services designed to assist
health center patients in establishing eligibility
for and gaining access to Federal, State, and
local programs that provide or financially support
the provision of medical, social, educational, or
other related services;
``(iv) services that enable individuals to use
the services of the health center (including
outreach and transportation services and, if a
substantial number of the individuals in the
population served by a center are of limited
English-speaking ability, the services of
appropriate personnel fluent in the language
spoken by a predominant number of such
individuals); and
``(v) education of patients and the general
population served by the health center regarding
the availability and proper use of health
services.
``(B) Exception.--With respect to a health center
that receives a grant only under subsection (g), the
Secretary, upon a showing of good cause, shall--
``(i) waive the requirement that the center
provide all required primary health services under
this paragraph; and
``(ii) approve, as appropriate, the provision
of certain required primary health services only
during certain periods of the year.
``(2) Additional health services.--The term `additional
health services' means services that are not included as
required primary health services and that are appropriate to
[[Page 110 STAT. 3628]]
meet the health needs of the population served by the health
center involved. Such term may include--
``(A) environmental health services, including--
``(i) the detection and alleviation of
unhealthful conditions associated with water
supply;
``(ii) sewage treatment;
``(iii) solid waste disposal;
``(iv) rodent and parasitic infestation;
``(v) field sanitation;
``(vi) housing; and
``(vii) other environmental factors related to
health; and
``(B) in the case of health centers receiving grants
under subsection (g), special occupation-related health
services for migratory and seasonal agricultural
workers, including--
``(i) screening for and control of infectious
diseases, including parasitic diseases; and
``(ii) injury prevention programs, including
prevention of exposure to unsafe levels of
agricultural chemicals including pesticides.
``(3) Medically underserved populations.--
``(A) In general.--The term `medically underserved
population' means the population of an urban or rural
area designated by the Secretary as an area with a
shortage of personal health services or a population
group designated by the Secretary as having a shortage
of such services.
``(B) Criteria.--In carrying out subparagraph (A),
the Secretary shall prescribe criteria for determining
the specific shortages of personal health services of an
area or population group. Such criteria shall--
``(i) take into account comments received by
the Secretary from the chief executive officer of
a State and local officials in a State; and
``(ii) include factors indicative of the
health status of a population group or residents
of an area, the ability of the residents of an
area or of a population group to pay for health
services and their accessibility to them, and the
availability of health professionals to residents
of an area or to a population group.
``(C) Limitation.--The Secretary may not designate a
medically underserved population in a State or terminate
the designation of such a population unless, prior to
such designation or termination, the Secretary provides
reasonable notice and opportunity for comment and
consults with--
``(i) the chief executive officer of such
State;
``(ii) local officials in such State; and
``(iii) the organization, if any, which
represents a majority of health centers in such
State.
``(D) Permissible designation.--The Secretary may
designate a medically underserved population that does
not meet the criteria established under subparagraph (B)
if the chief executive officer of the State in which
such population is located and local officials of such
State recommend the designation of such population based
on
[[Page 110 STAT. 3629]]
unusual local conditions which are a barrier to access
to or the availability of personal health services.
``(c) Planning Grants.--
``(1) In general.--
``(A) Centers.--The Secretary may make grants to
public and nonprofit private entities for projects to
plan and develop health centers which will serve
medically underserved populations. A project for which a
grant may be made under this subsection may include the
cost of the acquisition and lease of buildings and
equipment (including the costs of amortizing the
principal of, and paying the interest on, loans) and
shall include--
``(i) an assessment of the need that the
population proposed to be served by the health
center for which the project is undertaken has for
required primary health services and additional
health services;
``(ii) the design of a health center program
for such population based on such assessment;
``(iii) efforts to secure, within the proposed
catchment area of such center, financial and
professional assistance and support for the
project;
``(iv) initiation and encouragement of
continuing community involvement in the
development and operation of the project; and
``(v) proposed linkages between the center and
other appropriate provider entities, such as
health departments, local hospitals, and rural
health clinics, to provide better coordinated,
higher quality, and more cost-effective health
care services.
``(B) Comprehensive service delivery networks and
plans.--The Secretary may make grants to health centers
that receive assistance under this section to enable the
centers to plan and develop a network or plan for the
provision of health services, which may include the
provision of health services on a prepaid basis or
through another managed care arrangement, to some or to
all of the individuals which the centers serve. Such a
grant may only be made for such a center if--
``(i) the center has received grants under
subsection (e)(1)(A) for at least 2 consecutive
years preceding the year of the grant under this
subparagraph or has otherwise demonstrated, as
required by the Secretary, that such center has
been providing primary care services for at least
the 2 consecutive years immediately preceding such
year; and
``(ii) the center provides assurances
satisfactory to the Secretary that the provision
of such services on a prepaid basis, or under
another managed care arrangement, will not result
in the diminution of the level or quality of
health services provided to the medically
underserved population served prior to the grant
under this subparagraph.
Any such grant may include the acquisition and lease of
buildings and equipment which may include data and
information systems (including the costs of amortizing
the principal of, and paying the interest on, loans),
and providing training and technical assistance related
to the provi
[[Page 110 STAT. 3630]]
sion of health services on a prepaid basis or under
another managed care arrangement, and for other purposes
that promote the development of managed care networks
and plans.
``(2) Limitation.--Not more than two grants may be made
under this subsection for the same project, except that upon a
showing of good cause, the Secretary may make additional grant
awards.
``(d) Managed Care Loan Guarantee Program.--
``(1) Establishment.--
``(A) In general.--The Secretary shall establish a
program under which the Secretary may, in accordance
with this subsection and to the extent that
appropriations are provided in advance for such program,
guarantee the principal and interest on loans made by
non-Federal lenders to health centers funded under this
section for the costs of developing and operating
managed care networks or plans.
``(B) Use of funds.--Loan funds guaranteed under
this subsection may be used--
``(i) to establish reserves for the furnishing
of services on a pre-paid basis; or
``(ii) for costs incurred by the center or
centers, otherwise permitted under this section,
as the Secretary determines are necessary to
enable a center or centers to develop, operate,
and own the network or plan.
``(C) Publication of guidance.--Prior to considering
an application submitted under this subsection, the
Secretary shall publish guidelines to provide guidance
on the implementation of this section. The Secretary
shall make such guidelines available to the universe of
parties affected under this subsection, distribute such
guidelines to such parties upon the request of such
parties, and provide a copy of such guidelines to the
appropriate committees of Congress.
``(2) Protection of financial interests.--
``(A) In general.--The Secretary may not approve a
loan guarantee for a project under this subsection
unless the Secretary determines that--
``(i) the terms, conditions, security (if
any), and schedule and amount of repayments with
respect to the loan are sufficient to protect the
financial interests of the United States and are
otherwise reasonable, including a determination
that the rate of interest does not exceed such
percent per annum on the principal obligation
outstanding as the Secretary determines to be
reasonable, taking into account the range of
interest rates prevailing in the private market
for similar loans and the risks assumed by the
United States, except that the Secretary may not
require as security any center asset that is, or
may be, needed by the center or centers involved
to provide health services;
``(ii) the loan would not be available on
reasonable terms and conditions without the
guarantee under this subsection; and
[[Page 110 STAT. 3631]]
``(iii) amounts appropriated for the program
under this subsection are sufficient to provide
loan guarantees under this subsection.
``(B) Recovery of payments.--
``(i) In general.--The United States shall be
entitled to recover from the applicant for a loan
guarantee under this subsection the amount of any
payment made pursuant to such guarantee, unless
the Secretary for good cause waives such right of
recovery (subject to appropriations remaining
available to permit such a waiver) and, upon
making any such payment, the United States shall
be subrogated to all of the rights of the
recipient of the payments with respect to which
the guarantee was made. Amounts recovered under
this clause shall be credited as reimbursements to
the financing account of the program.
``(ii) Modification of terms and conditions.--
To the extent permitted by clause (iii) and
subject to the requirements of section 504(e) of
the Credit Reform Act of 1990 (2 U.S.C. 661c(e)),
any terms and conditions applicable to a loan
guarantee under this subsection (including terms
and conditions imposed under clause (iv)) may be
modified or waived by the Secretary to the extent
the Secretary determines it to be consistent with
the financial interest of the United States.
``(iii) Incontestability.--Any loan guarantee
made by the Secretary under this subsection shall
be incontestable--
``(I) in the hands of an applicant
on whose behalf such guarantee is made
unless the applicant engaged in fraud or
misrepresentation in securing such
guarantee; and
``(II) as to any person (or
successor in interest) who makes or
contracts to make a loan to such
applicant in reliance thereon unless
such person (or successor in interest)
engaged in fraud or misrepresentation in
making or contracting to make such loan.
``(iv) Further terms and conditions.--
Guarantees of loans under this subsection shall be
subject to such further terms and conditions as
the Secretary determines to be necessary to assure
that the purposes of this section will be
achieved.
``(3) Loan origination fees.--
``(A) In general.--The Secretary shall collect a
loan origination fee with respect to loans to be
guaranteed under this subsection, except as provided in
subparagraph (C).
``(B) Amount.--The amount of a loan origination fee
collected by the Secretary under subparagraph (A) shall
be equal to the estimated long term cost of the loan
guarantees involved to the Federal Government (excluding
administrative costs), calculated on a net present value
basis, after taking into account any appropriations that
may be made for the purpose of offsetting such costs,
and in accordance with the criteria used to award loan
guarantees under this subsection.
[[Page 110 STAT. 3632]]
``(C) Waiver.--The Secretary may waive the loan
origination fee for a health center applicant who
demonstrates to the Secretary that the applicant will be
unable to meet the conditions of the loan if the
applicant incurs the additional cost of the fee.
``(4) Defaults.--
``(A) In general.--Subject to the requirements of
the Credit Reform Act of 1990 (2 U.S.C. 661 et seq.),
the Secretary may take such action as may be necessary
to prevent a default on a loan guaranteed under this
subsection, including the waiver of regulatory
conditions, deferral of loan payments, renegotiation of
loans, and the expenditure of funds for technical and
consultative assistance, for the temporary payment of
the interest and principal on such a loan, and for other
purposes. Any such expenditure made under the preceding
sentence on behalf of a health center or centers shall
be made under such terms and conditions as the Secretary
shall prescribe, including the implementation of such
organizational, operational, and financial reforms as
the Secretary determines are appropriate and the
disclosure of such financial or other information as the
Secretary may require to determine the extent of the
implementation of such reforms.
``(B) Foreclosure.--The Secretary may take such
action, consistent with State law respecting foreclosure
procedures and, with respect to reserves required for
furnishing services on a prepaid basis, subject to the
consent of the affected States, as the Secretary
determines appropriate to protect the interest of the
United States in the event of a default on a loan
guaranteed under this subsection, except that the
Secretary may only foreclose on assets offered as
security (if any) in accordance with paragraph
(2)(A)(i).
``(5) Limitation.--Not more than one loan guarantee may be
made under this subsection for the same network or plan, except
that upon a showing of good cause the Secretary may make
additional loan guarantees.
``(6) Annual report.--Not later than April 1, 1998, and each
April 1 thereafter, the Secretary shall prepare and submit to
the appropriate committees of Congress a report concerning loan
guarantees provided under this subsection. Such report shall
include--
``(A) a description of the number, amount, and use
of funds received under each loan guarantee provided
under this subsection;
``(B) a description of any defaults with respect to
such loans and an analysis of the reasons for such
defaults, if any; and
``(C) a description of the steps that may have been
taken by the Secretary to assist an entity in avoiding
such a default.
``(7) Program <<NOTE: Reports.>> evaluation.--Not later than
June 30, 1999, the Secretary shall prepare and submit to the
appropriate committees of Congress a report containing an
evaluation of the program authorized under this subsection. Such
evaluation shall include a recommendation with respect to
whether or not the loan guarantee program under this subsection
should
[[Page 110 STAT. 3633]]
be continued and, if so, any modifications that should be made
to such program.
``(8) Authorization of appropriations.--There are authorized
to be appropriated to carry out this subsection such sums as may
be necessary.
``(e) Operating Grants.--
``(1) Authority.--
``(A) In general.--The Secretary may make grants for
the costs of the operation of public and nonprofit
private health centers that provide health services to
medically underserved populations.
``(B) Entities that fail to meet certain
requirements.--The Secretary may make grants, for a
period of not to exceed 2 years, for the costs of the
operation of public and nonprofit private entities which
provide health services to medically underserved
populations but with respect to which the Secretary is
unable to make each of the determinations required by
subsection (j)(3).
``(2) Use of funds.--The costs for which a grant may be made
under subparagraph (A) or (B) of paragraph (1) may include the
costs of acquiring and leasing buildings and equipment
(including the costs of amortizing the principal of, and paying
interest on, loans), and the costs of providing training related
to the provision of required primary health services and
additional health services and to the management of health
center programs.
``(3) Construction.--The Secretary may award grants which
may be used to pay the costs associated with expanding and
modernizing existing buildings or constructing new buildings
(including the costs of amortizing the principal of, and paying
the interest on, loans) for projects approved prior to October
1, 1996.
``(4) Limitation.--Not more than two grants may be made
under subparagraph (B) of paragraph (1) for the same entity.
``(5) Amount.--
``(A) In general.--The amount of any grant made in
any fiscal year under paragraph (1) to a health center
shall be determined by the Secretary, but may not exceed
the amount by which the costs of operation of the center
in such fiscal year exceed the total of--
``(i) State, local, and other operational
funding provided to the center; and
``(ii) the fees, premiums, and third-party
reimbursements, which the center may reasonably be
expected to receive for its operations in such
fiscal year.
``(B) Payments.--Payments under grants under
subparagraph (A) or (B) of paragraph (1) shall be made
in advance or by way of reimbursement and in such
installments as the Secretary finds necessary and
adjustments may be made for overpayments or
underpayments.
``(C) Use of nongrant funds.--Nongrant funds
described in clauses (i) and (ii) of subparagraph (A),
including any such funds in excess of those originally
expected, shall be used as permitted under this section,
and may be used for such other purposes as are not
specifically
[[Page 110 STAT. 3634]]
prohibited under this section if such use furthers the
objectives of the project.
``(f) Infant Mortality Grants.--
``(1) In general.--The Secretary may make grants to health
centers for the purpose of assisting such centers in--
``(A) providing comprehensive health care and
support services for the reduction of--
``(i) the incidence of infant mortality; and
``(ii) morbidity among children who are less
than 3 years of age; and
``(B) developing and coordinating service and
referral arrangements between health centers and other
entities for the health management of pregnant women and
children described in subparagraph (A).
``(2) Priority.--In making grants under this subsection the
Secretary shall give priority to health centers providing
services to any medically underserved population among which
there is a substantial incidence of infant mortality or among
which there is a significant increase in the incidence of infant
mortality.
``(3) Requirements.--The Secretary may make a grant under
this subsection only if the health center involved agrees that--
``(A) the center will coordinate the provision of
services under the grant to each of the recipients of
the services;
``(B) such services will be continuous for each such
recipient;
``(C) the center will provide follow-up services for
individuals who are referred by the center for services
described in paragraph (1);
``(D) the grant will be expended to supplement, and
not supplant, the expenditures of the center for primary
health services (including prenatal care) with respect
to the purpose described in this subsection; and
``(E) the center will coordinate the provision of
services with other maternal and child health providers
operating in the catchment area.
``(g) Migratory and Seasonal Agricultural Workers.--
``(1) In general.--The Secretary may award grants for the
purposes described in subsections (c), (e), and (f) for the
planning and delivery of services to a special medically
underserved population comprised of--
``(A) migratory agricultural workers, seasonal
agricultural workers, and members of the families of
such migratory and seasonal agricultural workers who are
within a designated catchment area; and
``(B) individuals who have previously been migratory
agricultural workers but who no longer meet the
requirements of subparagraph (A) of paragraph (3)
because of age or disability and members of the families
of such individuals who are within such catchment area.
``(2) Environmental concerns.--The Secretary may enter into
grants or contracts under this subsection with public and
private entities to--
``(A) assist the States in the implementation and
enforcement of acceptable environmental health
standards, including enforcement of standards for
sanitation in migra
[[Page 110 STAT. 3635]]
tory agricultural worker labor camps, and applicable
Federal and State pesticide control standards; and
``(B) conduct projects and studies to assist the
several States and entities which have received grants
or contracts under this section in the assessment of
problems related to camp and field sanitation, exposure
to unsafe levels of agricultural chemicals including
pesticides, and other environmental health hazards to
which migratory agricultural workers and members of
their families are exposed.
``(3) Definitions.--For purposes of this subsection:
``(A) Migratory agricultural worker.--The term
`migratory agricultural worker' means an individual
whose principal employment is in agriculture on a
seasonal basis, who has been so employed within the last
24 months, and who establishes for the purposes of such
employment a temporary abode.
``(B) Seasonal agricultural worker.--The term
`seasonal agricultural worker' means an individual whose
principal employment is in agriculture on a seasonal
basis and who is not a migratory agricultural worker.
``(C) Agriculture.--The term `agriculture' means
farming in all its branches, including--
``(i) cultivation and tillage of the soil;
``(ii) the production, cultivation, growing,
and harvesting of any commodity grown on, in, or
as an adjunct to or part of a commodity grown in
or on, the land; and
``(iii) any practice (including preparation
and processing for market and delivery to storage
or to market or to carriers for transportation to
market) performed by a farmer or on a farm
incident to or in conjunction with an activity
described in clause (ii).
``(h) Homeless Population.--
``(1) In general.--The Secretary may award grants for the
purposes described in subsections (c), (e), and (f) for the
planning and delivery of services to a special medically
underserved population comprised of homeless individuals,
including grants for innovative programs that provide outreach
and comprehensive primary health services to homeless children
and children at risk of homelessness.
``(2) Required services.--In addition to required primary
health services (as defined in subsection (b)(1)), an entity
that receives a grant under this subsection shall be required to
provide substance abuse services as a condition of such grant.
``(3) Supplement not supplant requirement.--A grant awarded
under this subsection shall be expended to supplement, and not
supplant, the expenditures of the health center and the value of
in kind contributions for the delivery of services to the
population described in paragraph (1).
``(4) Definitions.--For purposes of this section:
``(A) Homeless individual.--The term `homeless
individual' means an individual who lacks housing
(without regard to whether the individual is a member of
a family), including an individual whose primary
residence during the night is a supervised public or
private facility that
[[Page 110 STAT. 3636]]
provides temporary living accommodations and an
individual who is a resident in transitional housing.
``(B) Substance abuse.--The term `substance abuse'
has the same meaning given such term in section 534(4).
``(C) Substance abuse services.--The term `substance
abuse services' includes detoxification and residential
treatment for substance abuse provided in settings other
than hospitals.
``(i) Residents of Public Housing.--
``(1) In general.--The Secretary may award grants for the
purposes described in subsections (c), (e), and (f) for the
planning and delivery of services to a special medically
underserved population comprised of residents of public housing
(such term, for purposes of this subsection, shall have the same
meaning given such term in section 3(b)(1) of the United States
Housing Act of 1937) and individuals living in areas immediately
accessible to such public housing.
``(2) Supplement not supplant.--A grant awarded under this
subsection shall be expended to supplement, and not supplant,
the expenditures of the health center and the value of in kind
contributions for the delivery of services to the population
described in paragraph (1).
``(3) Consultation with residents.--The Secretary may not
make a grant under paragraph (1) unless, with respect to the
residents of the public housing involved, the applicant for the
grant--
``(A) has consulted with the residents in the
preparation of the application for the grant; and
``(B) agrees to provide for ongoing consultation
with the residents regarding the planning and
administration of the program carried out with the
grant.
``(j) Applications.--
``(1) Submission.--No grant may be made under this section
unless an application therefore is submitted to, and approved
by, the Secretary. Such an application shall be submitted in
such form and manner and shall contain such information as the
Secretary shall prescribe.
``(2) Description of need.--An application for a grant under
subparagraph (A) or (B) of subsection (e)(1) for a health center
shall include--
``(A) a description of the need for health services
in the catchment area of the center;
``(B) a demonstration by the applicant that the area
or the population group to be served by the applicant
has a shortage of personal health services; and
``(C) a demonstration that the center will be
located so that it will provide services to the greatest
number of individuals residing in the catchment area or
included in such population group.
Such a demonstration shall be made on the basis of the criteria
prescribed by the Secretary under subsection (b)(3) or on any
other criteria which the Secretary may prescribe to determine if
the area or population group to be served by the applicant has a
shortage of personal health services. In considering an
application for a grant under subparagraph (A) or (B) of
subsection (e)(1), the Secretary may require as a condition to
the approval of such application an assurance that the applicant
[[Page 110 STAT. 3637]]
will provide any health service defined under paragraphs (1) and
(2) of subsection (b) that the Secretary finds is needed to meet
specific health needs of the area to be served by the applicant.
Such a finding shall be made in writing and a copy shall be
provided to the applicant.
``(3) Requirements.--Except as provided in subsection
(e)(1)(B), the Secretary may not approve an application for a
grant under subparagraph (A) or (B) of subsection (e)(1) unless
the Secretary determines that the entity for which the
application is submitted is a health center (within the meaning
of subsection (a)) and that--
``(A) the required primary health services of the
center will be available and accessible in the catchment
area of the center promptly, as appropriate, and in a
manner which assures continuity;
``(B) the center has made and will continue to make
every reasonable effort to establish and maintain
collaborative relationships with other health care
providers in the catchment area of the center;
``(C) the center will have an ongoing quality
improvement system that includes clinical services and
management, and that maintains the confidentiality of
patient records;
``(D) the center will demonstrate its financial
responsibility by the use of such accounting procedures
and other requirements as may be prescribed by the
Secretary;
``(E) the center--
``(i) has or will have a contractual or other
arrangement with the agency of the State, in which
it provides services, which administers or
supervises the administration of a State plan
approved under title XIX of the Social Security
Act for the payment of all or a part of the
center's costs in providing health services to
persons who are eligible for medical assistance
under such a State plan; or
``(ii) has made or will make every reasonable
effort to enter into such an arrangement;
``(F) the center has made or will make and will
continue to make every reasonable effort to collect
appropriate reimbursement for its costs in providing
health services to persons who are entitled to insurance
benefits under title XVIII of the Social Security Act,
to medical assistance under a State plan approved under
title XIX of such Act, or to assistance for medical
expenses under any other public assistance program or
private health insurance program;
``(G) the center--
``(i) has prepared a schedule of fees or
payments for the provision of its services
consistent with locally prevailing rates or
charges and designed to cover its reasonable costs
of operation and has prepared a corresponding
schedule of discounts to be applied to the payment
of such fees or payments, which discounts are
adjusted on the basis of the patient's ability to
pay;
``(ii) has made and will continue to make
every reasonable effort--
[[Page 110 STAT. 3638]]
``(I) to secure from patients
payment for services in accordance with
such schedules; and
``(II) to collect reimbursement for
health services to persons described in
subparagraph (F) on the basis of the
full amount of fees and payments for
such services without application of any
discount; and
``(iii) has submitted to the Secretary such
reports as the Secretary may require to determine
compliance with this subparagraph;
``(H) the center has established a governing board
which except in the case of an entity operated by an
Indian tribe or tribal or Indian organization under the
Indian Self-Determination Act or an urban Indian
organization under the Indian Health Care Improvement
Act (25 U.S.C. 1651 et seq.)--
``(i) is composed of individuals, a majority
of whom are being served by the center and who, as
a group, represent the individuals being served by
the center;
``(ii) meets at least once a month, selects
the services to be provided by the center,
schedules the hours during which such services
will be provided, approves the center's annual
budget, approves the selection of a director for
the center, and, except in the case of a governing
board of a public center (as defined in the second
sentence of this paragraph), establishes general
policies for the center; and
``(iii) in the case of an application for a
second or subsequent grant for a public center,
has approved the application or if the governing
body has not approved the application, the failure
of the governing body to approve the application
was unreasonable;
except that, upon a showing of good cause the Secretary
shall waive, for the length of the project period, all
or part of the requirements of this subparagraph in the
case of a health center that receives a grant pursuant
to subsection (g), (h), (i), or (p);
``(I) the center has developed--
``(i) an overall plan and budget that meets
the requirements of the Secretary; and
``(ii) an effective procedure for compiling
and reporting to the Secretary such statistics and
other information as the Secretary may require
relating to--
``(I) the costs of its operations;
``(II) the patterns of use of its
services;
``(III) the availability,
accessibility, and acceptability of its
services; and
``(IV) such other matters relating
to operations of the applicant as the
Secretary may require;
``(J) the center will review periodically its
catchment area to--
``(i) ensure that the size of such area is
such that the services to be provided through the
center (including any satellite) are available and
accessible to the residents of the area promptly
and as appropriate;
``(ii) ensure that the boundaries of such area
conform, to the extent practicable, to relevant
boundaries
[[Page 110 STAT. 3639]]
of political subdivisions, school districts, and
Federal and State health and social service
programs; and
``(iii) ensure that the boundaries of such
area eliminate, to the extent possible, barriers
to access to the services of the center, including
barriers resulting from the area's physical
characteristics, its residential patterns, its
economic and social grouping, and available
transportation;
``(K) in the case of a center which serves a
population including a substantial proportion of
individuals of limited English-speaking ability, the
center has--
``(i) developed a plan and made arrangements
responsive to the needs of such population for
providing services to the extent practicable in
the language and cultural context most appropriate
to such individuals; and
``(ii) identified an individual on its staff
who is fluent in both that language and in English
and whose responsibilities shall include providing
guidance to such individuals and to appropriate
staff members with respect to cultural
sensitivities and bridging linguistic and cultural
differences; and
``(L) the center, has developed an ongoing referral
relationship with one or more hospitals.
For purposes of subparagraph (H), the term `public center' means
a health center funded (or to be funded) through a grant under
this section to a public agency.
``(4) Approval of new or expanded service applications.--The
Secretary shall approve applications for grants under
subparagraph (A) or (B) of subsection (e)(1) for health centers
which--
``(A) have not received a previous grant under such
subsection; or
``(B) have applied for such a grant to expand their
services;
in such a manner that the ratio of the medically underserved
populations in rural areas which may be expected to use the
services provided by such centers to the medically underserved
populations in urban areas which may be expected to use the
services provided by such centers is not less than two to three
or greater than three to two.
``(k) Technical and Other Assistance.--The Secretary may provide
(either through the Department of Health and Human Services or by grant
or contract) all necessary technical and other nonfinancial assistance
(including fiscal and program management assistance and training in such
management) to any public or private nonprofit entity to assist entities
in developing plans for, or operating as, health centers, and in meeting
the requirements of subsection (j)(2).
``(l) Authorization of Appropriations.--
``(1) In general.--For the purpose of carrying out this
section, in addition to the amounts authorized to be
appropriated under subsection (d), there are authorized to be
appropriated $802,124,000 for fiscal year 1997, and such sums as
may be necessary for each of the fiscal years 1998 through 2001.
``(2) Special provisions.--
[[Page 110 STAT. 3640]]
``(A) Public centers.--The Secretary may not expend
in any fiscal year, for grants under this section to
public centers (as defined in the second sentence of
subsection (j)(3)) the governing boards of which (as
described in subsection (j)(3)(G)(ii)) do not establish
general policies for such centers, an amount which
exceeds 5 percent of the amounts appropriated under this
section for that fiscal year. For purposes of applying
the preceding sentence, the term `public centers' shall
not include health centers that receive grants pursuant
to subsection (h) or (i).
``(B) Distribution of grants.--
``(i) Fiscal year 1997.--For fiscal year 1997,
the Secretary, in awarding grants under this
section shall ensure that the amounts made
available under each of subsections (g), (h), and
(i) in such fiscal year bears the same
relationship to the total amount appropriated for
such fiscal year under paragraph (1) as the
amounts appropriated for fiscal year 1996 under
each of sections 329, 340, and 340A (as such
sections existed one day prior to the date of
enactment of this section) bears to the total
amount appropriated under sections 329, 330, 340,
and 340A (as such sections existed one day prior
to the date of enactment of this section) for such
fiscal year.
``(ii) Fiscal years 1998 and 1999.--For each
of the fiscal years 1998 and 1999, the Secretary,
in awarding grants under this section shall ensure
that the proportion of the amounts made available
under each of subsections (g), (h), and (i) is
equal to the proportion of amounts made available
under each such subsection for the previous fiscal
year, as such amounts relate to the total amounts
appropriated for the previous fiscal year
involved, increased or decreased by not more than
10 percent.
``(3) Funding report.--The Secretary shall annually prepare
and submit to the appropriate committees of Congress a report
concerning the distribution of funds under this section that are
provided to meet the health care needs of medically underserved
populations, including the homeless, residents of public
housing, and migratory and seasonal agricultural workers, and
the appropriateness of the delivery systems involved in
responding to the needs of the particular populations. Such
report shall include an assessment of the relative health care
access needs of the targeted populations and the rationale for
any substantial changes in the distribution of funds.
``(m) Memorandum of Agreement.--In carrying out this section, the
Secretary may enter into a memorandum of agreement with a State. Such
memorandum may include, where appropriate, provisions permitting such
State to--
``(1) analyze the need for primary health services for
medically underserved populations within such State;
``(2) assist in the planning and development of new health
centers;
``(3) review and comment upon annual program plans and
budgets of health centers, including comments upon allocations
of health care resources in the State;
[[Page 110 STAT. 3641]]
``(4) assist health centers in the development of clinical
practices and fiscal and administrative systems through a
technical assistance plan which is responsive to the requests of
health centers; and
``(5) share information and data relevant to the operation
of new and existing health centers.
``(n) Records.--
``(1) In general.--Each entity which receives a grant under
subsection (e) shall establish and maintain such records as the
Secretary shall require.
``(2) Availability.--Each entity which is required to
establish and maintain records under this subsection shall make
such books, documents, papers, and records available to the
Secretary or the Comptroller General of the United States, or
any of their duly authorized representatives, for examination,
copying or mechanical reproduction on or off the premises of
such entity upon a reasonable request therefore. The Secretary
and the Comptroller General of the United States, or any of
their duly authorized representatives, shall have the authority
to conduct such examination, copying, and reproduction.
``(o) Delegation of Authority.--The Secretary may delegate the
authority to administer the programs authorized by this section to any
office, except that the authority to enter into, modify, or issue
approvals with respect to grants or contracts may be delegated only
within the central office of the Health Resources and Services
Administration.
``(p) Special Consideration.--In making grants under this section,
the Secretary shall give special consideration to the unique needs of
sparsely populated rural areas, including giving priority in the
awarding of grants for new health centers under subsections (c) and (e),
and the granting of waivers as appropriate and permitted under
subsections (b)(1)(B)(i) and (j)(3)(G).
``(q) Audits.--
``(1) In general.--Each entity which receives a grant under
this section shall provide for an independent annual financial
audit of any books, accounts, financial records, files, and
other papers and property which relate to the disposition or use
of the funds received under such grant and such other funds
received by or allocated to the project for which such grant was
made. For purposes of assuring accurate, current, and complete
disclosure of the disposition or use of the funds received, each
such audit shall be conducted in accordance with generally
accepted accounting principles. Each audit shall evaluate--
``(A) the entity's implementation of the guidelines
established by the Secretary respecting cost accounting,
``(B) the processes used by the entity to meet the
financial and program reporting requirements of the
Secretary, and
``(C) the billing and collection procedures of the
entity and the relation of the procedures to its fee
schedule and schedule of discounts and to the
availability of health insurance and public programs to
pay for the health services it provides.
A report of each such audit shall be filed with the Secretary at
such time and in such manner as the Secretary may require.
[[Page 110 STAT. 3642]]
``(2) Records.--Each <<NOTE: Regulations.>> entity which
receives a grant under this section shall establish and maintain
such records as the Secretary shall by regulation require to
facilitate the audit required by paragraph (1). The Secretary
may specify by regulation the form and manner in which such
records shall be established and maintained.
``(3) Availability of records.--Each entity which is
required to establish and maintain records or to provide for and
audit under this subsection shall make such books, documents,
papers, and records available to the Secretary or the
Comptroller General of the United States, or any of their duly
authorized representatives, for examination, copying or
mechanical reproduction on or off the premises of such entity
upon a reasonable request therefore. The Secretary and the
Comptroller General of the United States, or any of their duly
authorized representatives, shall have the authority to conduct
such examination, copying, and reproduction.
``(4) Waiver.--The Secretary may, under appropriate
circumstances, waive the application of all or part of the
requirements of this subsection with respect to an entity.''.
SEC. 3. RURAL HEALTH OUTREACH, NETWORK DEVELOPMENT, AND
TELEMEDICINE GRANT PROGRAM.
(a) In General.--Subpart I of part D of title III of the Public
Health Service Act (42 U.S.C. 254b et seq.) (as amended by section 2) is
further amended by adding at the end thereof the following new section:
``SEC. 330A. RURAL <<NOTE: 42 USC 254c.>> HEALTH OUTREACH, NETWORK
DEVELOPMENT, AND TELEMEDICINE GRANT
PROGRAM.
``(a) Administration.--The rural health services outreach
demonstration grant program established under section 301 shall be
administered by the Office of Rural Health Policy (of the Health
Resources and Services Administration), in consultation with State rural
health offices or other appropriate State governmental entities.
``(b) Grants.--Under the program referred to in subsection (a), the
Secretary, acting through the Director of the Office of Rural Health
Policy, may award grants to expand access to, coordinate, restrain the
cost of, and improve the quality of essential health care services,
including preventive and emergency services, through the development of
integrated health care delivery systems or networks in rural areas and
regions.
``(c) Eligible Networks.--
``(1) Outreach networks.--To be eligible to receive a grant
under this section, an entity shall--
``(A) be a rural public or nonprofit private entity
that is or represents a network or potential network
that includes three or more health care providers or
other entities that provide or support the delivery of
health care services; and
``(B) in consultation with the State office of rural
health or other appropriate State entity, prepare and
submit to the Secretary an application, at such time, in
such manner, and containing such information as the
Secretary may require, including--
[[Page 110 STAT. 3643]]
``(i) a description of the activities which
the applicant intends to carry out using amounts
provided under the grant;
``(ii) a plan for continuing the project after
Federal support is ended;
``(iii) a description of the manner in which
the activities funded under the grant will meet
health care needs of underserved rural populations
within the State; and
``(iv) a description of how the local
community or region to be served by the network or
proposed network will be involved in the
development and ongoing operations of the network.
``(2) For-profit entities.--An eligible network may include
for-profit entities so long as the network grantee is a
nonprofit entity.
``(3) Telemedicine networks.--
``(A) In general.--An entity that is a health care
provider and a member of an existing or proposed
telemedicine network, or an entity that is a consortium
of health care providers that are members of an existing
or proposed telemedicine network shall be eligible for a
grant under this section.
``(B) Requirement.--A telemedicine network referred
to in subparagraph (A) shall, at a minimum, be composed
of--
``(i) a multispecialty entity that is located
in an urban or rural area, which can provide 24-
hour a day access to a range of specialty care;
and
``(ii) at least two rural health care
facilities, which may include rural hospitals,
rural physician offices, rural health clinics,
rural community health clinics, and rural nursing
homes.
``(d) Preference.--In awarding grants under this section, the
Secretary shall give preference to applicant networks that include--
``(1) a majority of the health care providers serving in the
area or region to be served by the network;
``(2) any federally qualified health centers, rural health
clinics, and local public health departments serving in the area
or region;
``(3) outpatient mental health providers serving in the area
or region; or
``(4) appropriate social service providers, such as agencies
on aging, school systems, and providers under the women,
infants, and children program, to improve access to and
coordination of health care services.
``(e) Use of Funds.--
``(1) In general.--Amounts provided under grants awarded
under this section shall be used--
``(A) for the planning and development of integrated
self-sustaining health care networks; and
``(B) for the initial provision of services.
``(2) Expenditures in rural areas.--
``(A) In general.--In awarding a grant under this
section, the Secretary shall ensure that not less than
50 percent of the grant award is expended in a rural
area or to provide services to residents of rural areas.
[[Page 110 STAT. 3644]]
``(B) Telemedicine networks.--An entity described in
subsection (c)(3) may not use in excess of--
``(i) 40 percent of the amounts provided under
a grant under this section to carry out activities
under paragraph (3)(A)(iii); and
``(ii) 20 percent of the amounts provided
under a grant under this section to pay for the
indirect costs associated with carrying out the
purposes of such grant.
``(3) Telemedicine networks.--
``(A) In general.--An entity described in subsection
(c)(3), may use amounts provided under a grant under
this section to--
``(i) demonstrate the use of telemedicine in
facilitating the development of rural health care
networks and for improving access to health care
services for rural citizens;
``(ii) provide a baseline of information for a
systematic evaluation of telemedicine systems
serving rural areas;
``(iii) purchase or lease and install
equipment; and
``(iv) operate the telemedicine system and
evaluate the telemedicine system.
``(B) Limitations.--An entity described in
subsection (c)(3), may not use amounts provided under a
grant under this section--
``(i) to build or acquire real property;
``(ii) purchase or install transmission
equipment (such as laying cable or telephone
lines, microwave towers, satellite dishes,
amplifiers, and digital switching equipment); or
``(iii) for construction, except that such
funds may be expended for minor renovations
relating to the installation of equipment;
``(f) Term of Grants.--Funding may not be provided to a network
under this section for in excess of a 3-year period.
``(g) Authorization of Appropriations.--For the purpose of carrying
out this section there are authorized to be appropriated $36,000,000 for
fiscal year 1997, and such sums as may be necessary for each of the
fiscal years 1998 through 2001.''.
(b) Transition.--The <<NOTE: 42 USC 254b note.>> Secretary of Health
and Human Services shall ensure the continued funding of grants made, or
contracts or cooperative agreements entered into, under subpart I of
part D of title III of the Public Health Service Act (42 U.S.C. 254b et
seq.) (as such subpart existed on the day prior to the date of enactment
of this Act), until the expiration of the grant period or the term of
the contract or cooperative agreement. Such funding shall be continued
under the same terms and conditions as were in effect on the date on
which the grant, contract or cooperative agreement was awarded, subject
to the availability of appropriations.
SEC. 4. TECHNICAL AND CONFORMING AMENDMENTS.
(a) In General.--The Public Health Service Act is amended--
(1) in section 224(g)(4) (42 U.S.C. 233(g)(4)), by striking
``under'' and all that follows through the end thereof and
inserting ``under section 330.'';
[[Page 110 STAT. 3645]]
(2) in section 340C(a)(2) (42 U.S.C. 256c) by striking
``under'' and all that follows through the end thereof and
inserting ``with assistance provided under section 330.''; and
(3) by repealing subparts V and VI of part D of title III
(42 U.S.C. 256 et seq.).
(b) Social Security Act.--The Social Security Act is amended--
(1) in clauses (i) and (ii)(I) of section 1861(aa)(4)(A) (42
U.S.C. 1395x(aa)(4)(A) (i) and (ii)(I)) by striking ``section
329, 330, or 340'' and inserting ``section 330 (other than
subsection (h))''; and
(2) in clauses (i) and (ii)(II) of section 1905(l)(2)(B) (42
U.S.C. 1396d(l)(2)(B) (i) and (ii)(II)) by striking ``section
329, 330, 340, or 340A'' and inserting ``section 330''.
(c) References.--Whenever <<NOTE: 42 USC 254b note.>> any reference
is made in any provision of law, regulation, rule, record, or document
to a community health center, migrant health center, public housing
health center, or homeless health center, such reference shall be
considered a reference to a health center.
(d) FTCA Clarification.--For purposes of section 224(k)(3) of the
Public Health Service Act (42 U.S.C. 233(k)(3)), transfers from the fund
described in such section for fiscal year 1996 shall be deemed to have
occurred prior to December 31, 1995.
(e) Additional <<NOTE: 42 USC 254b note.>> Amendments.--After
consultation with the appropriate committees of the Congress, the
Secretary of Health and Human Services shall prepare and submit to the
Congress a legislative proposal in the form of an implementing bill
containing technical and conforming amendments to reflect the changes
made by this Act.
SEC. 5. <<NOTE: 42 USC 233 note.>> EFFECTIVE DATE.
This Act and the amendments made by this Act shall become effective
on October 1, 1997.
Approved October 11, 1996.
LEGISLATIVE HISTORY--S. 1044:
---------------------------------------------------------------------------
SENATE REPORTS: No. 104-186 (Comm. on Labor and Human Resources).
CONGRESSIONAL RECORD, Vol. 142 (1996):
Sept. 20, considered and passed Senate.
Sept. 27, considered and passed House.
<all>