
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 23, 2000]
[Document not affected by Public Laws enacted between
  January 23, 2000 and December 4, 2001]
[CITE: 42USC254g]

 
                 TITLE 42--THE PUBLIC HEALTH AND WELFARE
 
                    CHAPTER 6A--PUBLIC HEALTH SERVICE
 
                SUBCHAPTER II--GENERAL POWERS AND DUTIES
 
                       Part D--Primary Health Care
 
            subpart ii--national health service corps program
 
Sec. 254g. Cost sharing


(a) Charges for services; collection of payments; payment to United 
        States; calculation of payments; annual report

    The Secretary shall require, as a condition to the approval of an 
application under section 254f of this title for the assignment of a 
member of the Corps, that the entity which submitted the application 
enter into an agreement for a specific assignment period (not to exceed 
4 years) with the Secretary under which--
        (1) the entity shall be responsible for charging, in accordance 
    with subsection (d) of this section, for health services provided by 
    Corps members assigned to the entity;
        (2) the entity shall take such action as may be reasonable for 
    the collection of payments for such health services, including, if a 
    Federal agency, an agency of a State or local government, or other 
    third party would be responsible for all or part of the cost of such 
    health services if it had not been provided by Corps members under 
    this subpart, the collection, on a fee-for-service or other basis, 
    from such agency or third party, the portion of such cost for which 
    it would be so responsible (and in determining the amount of such 
    cost which such agency or third party would be responsible, the 
    health services provided by Corps members shall be considered as 
    being provided by private practitioners);
        (3) the entity, if not a small health center, shall pay to the 
    United States, as prescribed by the Secretary in each calendar 
    quarter (or other period as may be specified in the agreement) 
    during which any Corps member is assigned to such entity, the sum 
    of--
            (A) an amount calculated by the Secretary to reflect the 
        average salary (including amounts paid in accordance with 
        section 254d(d) of this title) and allowances of comparable 
        Corps members for a calendar quarter (or other period);
            (B) that portion of an amount calculated by the Secretary to 
        reflect the average amount paid under the Scholarship Program or 
        the Loan Repayment Program to or on behalf of comparable Corps 
        members that bears the same ratio to the calculated amount as 
        the number of days of service provided by the member during that 
        quarter (or other period) bears to the number of days in his 
        period of obligated service under the Scholarship Program or the 
        Loan Repayment Program; and
            (C) if such entity received a loan under section 254h(c) of 
        this title or a grant under section 254f(d)(2) \1\ of this 
        title, an amount which bears the same ratio to the amount of 
        such loan or grant as the number of days in such quarter (or 
        other period) during which any Corps members were assigned to 
        the entity bears to the number of days in the assignment period 
        after such entity received such loan or grant;
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    \1\ See References in Text note below.

        (4) the entity, if a small health center, shall pay to the 
    United States, in each calendar quarter (or other period as may be 
    specified in the agreement) during which any Corps member is 
    assigned to such entity, an amount determined by the Secretary in 
    accordance with subsection (f) of this section; and
        (5) the entity shall prepare and submit to the Secretary an 
    annual report, in such form and manner, as the Secretary may 
    require.

(b) Waiver of payment; use of funds

    (1) The Secretary may waive in whole or in part, on a prospective or 
retrospective basis, the application of the requirement of subsection 
(a)(3) of this section for an entity which is not a small health center 
if he determines that the entity is financially unable to meet such 
requirement or if he determines that compliance with such requirement 
would unreasonably limit the ability of the entity to provide for the 
adequate support of the provision of health services by Corps members.
    (2) The Secretary may waive in whole or in part, on a prospective or 
retrospective basis, the application of the requirement of subsection 
(a)(3) of this section for any entity which is not a small health center 
and which is located in a health professional shortage area in which a 
significant percentage of the individuals are elderly, living in 
poverty, or have other characteristics which indicate an inability to 
repay, in whole or in part, the amounts required in subsection (a)(3) of 
this section.
    (3) In the event that the Secretary grants a waiver under paragraph 
(1) or (2), and does not, pursuant to paragraph (5), require payment by 
the entity in the amount described in subsection (f)(1) of this section, 
the entity shall be required to use the total amount of funds collected 
by such entity in accordance with subsection (a)(2) of this section for 
the improvement of the capability of such entity to deliver health 
services to the individuals in, or served by, the health professional 
shortage area.
    (4) In determining whether to grant a waiver under paragraph (1) or 
(2), the Secretary shall not discriminate against a public entity.
    (5)(A) If the Secretary determines that an entity which is not a 
small health center is eligible for a waiver under paragraph (1) or (2), 
the Secretary may waive the application of subsection (a)(3) of this 
section for such entity and require such entity to make payment in an 
amount equal to the amount described in subsection (f)(1) of this 
section that would be payable by such entity if such entity were a small 
health center.
    (B) The Secretary may waive in whole or in part, on a prospective or 
retrospective basis, the application of the requirement of subparagraph 
(A) for any entity if the Secretary determines that the entity is 
financially unable to meet such requirement or that compliance with such 
requirement would unreasonably limit the ability of the entity to 
provide for the adequate support of the provision of health services by 
Corps members. Funds which would be paid to the United States but for a 
waiver under this subparagraph shall be used by an entity to--
        (i) expand or improve its provision of health services;
        (ii) increase the number of individuals served;
        (iii) renovate or modernize facilities for its provision of 
    health services;
        (iv) improve the administration of its health service programs; 
    or
        (v) to establish a financial reserve to assure its ability to 
    continue providing health services.

(c) Excess funds

    The excess (if any) of the amount of funds collected by an entity 
which is not a small health center in accordance with subsection (a)(2) 
of this section over the amount paid to the United States in accordance 
with subsection (a)(3) of this section or subsection (b)(5)(A) of this 
section shall be used by the entity to expand and improve the provision 
of health services to the individuals in the health professional 
shortage area for which the entity submitted an application or to 
recruit and retain health manpower to provide health services for such 
individuals.

(d) Charge for services; reduced rate; no charge

    Any person who receives health services provided by a Corps member 
under this subpart shall be charged for such services on a fee-for-
service or other basis, at a rate approved by the Secretary, pursuant to 
regulations. Such rate shall be computed in such a way as to permit the 
recovery of the value of such services, except that if such person is 
determined under regulations of the Secretary to be unable to pay such 
charge, the Secretary shall provide for the furnishing of such services 
at a reduced rate or without charge.

(e) Deposit of funds in Treasury as miscellaneous receipts; 
        appropriations unaffected

    Funds received by the Secretary under an agreement entered into 
under this section shall be deposited in the Treasury as miscellaneous 
receipts and shall be disregarded in determining the amounts of 
appropriations to be requested and the amounts to be made available from 
appropriations made under section 254k of this title to carry out 
sections 254d through 254h and section 254j of this title.

(f) Small health centers

    (1) An entity which is a small health center shall pay to the United 
States, as prescribed by the Secretary in each calendar quarter (or 
other period as may be specified in the agreement) during which any 
Corps member is assigned to such entity, an amount equal to the amount 
(prorated for a calendar quarter or other period) by which the revenues 
that the center may reasonably expect to receive during an annual period 
for the provision of health services exceeds the costs that the center 
may reasonably expect to incur in the provision of such services, except 
that the amount that an entity shall pay to the United States under this 
paragraph shall not exceed the amount such entity would pay to the 
United States under paragraph (3) of subsection (a) of this section if 
such paragraph applied to such entity.
    (2)(A) To determine for purposes of paragraph (1) the revenues and 
costs which an entity that is a small health center may reasonably be 
expected to receive and incur in an annual period for the provision of 
health services, the entity shall submit to the Secretary before the 
beginning of such period a proposed budget which--
        (i) describes the primary and supplemental health services (as 
    defined in section 254c \2\ of this title) which are needed by the 
    area the entity serves in such period; and
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    \2\ See References in Text note below.
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        (ii) states the revenues and costs which the entity expects to 
    receive and incur in providing such health services in such period.

    (B) From the submission under subparagraph (A) and other information 
available to the Secretary, the Secretary shall determine--
        (i) the primary and supplemental health services (as defined in 
    section 254c \2\ of this title) needed in the area the entity 
    serves;
        (ii) the fees, premiums, third party reimbursements, and other 
    revenues the entity making the submission may reasonably expect to 
    receive from the provision of such services; and
        (iii) the costs which the entity may reasonably expect to incur 
    in providing such services.

The revenues and costs determined by the Secretary shall be the revenues 
and costs used in making the determination under paragraph (1).
    (C)(i) A determination under subparagraph (B) regarding the revenues 
and costs of an entity in an annual period shall be made by the 
Secretary utilizing criteria specific to the entity and shall be made 
without regard to whether the entity is making progress toward 
collecting sufficient revenues to provide an adequate level of primary 
health services without the assignment of Corps members.
    (ii) In making a determination referred to in clause (i)--
        (I) the Secretary may consider whether the proposed budget 
    submitted under subparagraph (A) provides a reasonable estimate 
    regarding the revenues and costs of the entity; and
        (II) may not consider the reasonableness of the amount of 
    revenues collected, or the amount of costs incurred by the entity, 
    except to the extent necessary to ensure that the entity is 
    operating in good faith and is operating efficiently with respect to 
    fiscal matters within the control of the entity.

    (iii) A determination of whether an entity is eligible for a waiver 
under paragraph (3) shall be made by the Secretary without regard to the 
revenues and costs determined by the Secretary under subparagraph (B).
    (iv) A determination of whether an entity is a small health center 
shall be made by the Secretary without regard to the revenues and costs 
determined by the Secretary under subparagraph (B).
    (3) The Secretary may waive in whole or in part, on a prospective or 
retrospective basis, the application of paragraph (1) for an entity 
which is a small health center if the Secretary determines that the 
entity needs all or part of the amounts otherwise payable under such 
paragraph to--
        (A) expand or improve its provision of health services;
        (B) increase the number of individuals served;
        (C) renovate or modernize facilities for its provision of health 
    services;
        (D) improve the administration of its health service programs; 
    or
        (E) establish a financial reserve to assure its ability to 
    continue providing health services.

    (4) The excess (if any) of the amount of funds collected by an 
entity which is a small health center in accordance with subsection 
(a)(2) of this section over the amount paid to the United States in 
accordance with paragraph (1) of this subsection shall be used by the 
center for the purposes set out in subparagraphs (A) through (E) of 
paragraph (3) of this subsection or to recruit and retain health 
manpower to provide health services to the individuals in the health 
professional shortage area for which the entity submitted an 
application.
    (5) For purposes of this section, the term ``small health center'' 
means an entity other than--
        (A) a hospital (or part of a hospital);
        (B) a public entity; or
        (C) an entity that is receiving a grant under section 254b \2\ 
    of this title or section 254c \2\ of this title, except that such 
    term includes an entity whose grant is less than the total of the 
    amounts, calculated on an annual basis, specified in subparagraphs 
    (A) and (B) of subsection (a)(3) of this section.

(July 1, 1944, ch. 373, title III, Sec. 334, as added Pub. L. 94-484, 
title IV, Sec. 407(b)(3), Oct. 12, 1976, 90 Stat. 2274; amended Pub. L. 
97-35, title XXVII, Sec. 2704, Aug. 13, 1981, 95 Stat. 906; Pub. L. 98-
194, Sec. 3, Dec. 1, 1983, 97 Stat. 1345; Pub. L. 100-177, title II, 
Sec. 202(c), Dec. 1, 1987, 101 Stat. 996; Pub. L. 101-597, title I, 
Sec. 105, title IV, Sec. 401(b)[(a)], Nov. 16, 1990, 104 Stat. 3018, 
3035.)

                       References in Text

    Section 254f(d) of this title, referred to in subsec. (a)(3)(C), was 
redesignated section 254f(b) of this title by Pub. L. 101-597, title I, 
Sec. 103(b)(2), Nov. 16, 1990, 104 Stat. 3015.
    Sections 254b and 254c of this title, referred to in subsec. 
(f)(2)(A)(i), (B)(i), (5)(C), were in the original references to 
sections 329 and 330, meaning sections 329 and 330 of act July 1, 1944, 
which were omitted in the general amendment of subpart I (Sec. 254b et 
seq.) of this part by Pub. L. 104-299, Sec. 2, Oct. 11, 1996, 110 Stat. 
3626. Sections 2 and 3(a) of Pub. L. 104-299 enacted new sections 330 
and 330A of act July 1, 1944, which are classified, respectively, to 
sections 254b and 254c of this title.


                               Amendments

    1990--Subsecs. (b)(2), (3), (c). Pub. L. 101-597, Sec. 401(b)[(a)], 
substituted reference to health professional shortage area for reference 
to health manpower shortage area.
    Subsec. (f)(2)(C). Pub. L. 101-597, Sec. 105, added subpar. (C).
    Subsec. (f)(4). Pub. L. 101-597, Sec. 401(b)[(a)], substituted 
reference to health professional shortage area for reference to health 
manpower shortage area.
    1987--Subsec. (a)(3)(B). Pub. L. 100-177 inserted ``or the Loan 
Repayment Program'' after ``amount paid under the Scholarship Program'' 
and substituted ``service under the Scholarship Program or the Loan 
Repayment Program'' for ``service under the Program''.
    1983--Subsec. (a)(3). Pub. L. 98-194, Sec. 3(a)(1)(A), inserted ``, 
if not a small health center,'' after ``the entity'' in provisions 
preceding subpar. (A).
    Subsec. (a)(4), (5). Pub. L. 98-194, Sec. 3(a)(1), (C), (D), added 
par. (4) and redesignated former par. (4) as (5).
    Subsec. (b)(1). Pub. L. 98-194, Sec. 3(b)(1), (2), inserted ``, on a 
prospective or retrospective basis,'' after ``in whole or in part'', and 
``which is not a small health center'' after ``for an entity''.
    Subsec. (b)(2). Pub. L. 98-194, Sec. 3(b)(3), (4), inserted ``, on a 
prospective or retrospective basis,'' after ``in whole or in part'', and 
``is not a small health center and which'' after ``for any entity 
which''.
    Subsec. (b)(3). Pub. L. 98-194, Sec. 3(b)(5), inserted ``and does 
not, pursuant to paragraph (5), require payment by the entity in the 
amount described in subsection (f)(1) of this section,'' after 
``paragraph (1) or (2),''.
    Subsec. (b)(5). Pub. L. 98-194, Sec. 3(b)(6), added par. (5).
    Subsec. (c). Pub. L. 98-194, Sec. 3(c), inserted ``which is not a 
small health center'' after ``an entity'', and ``or subsection (b)(5)(A) 
of this section'' before ``shall be used by the entity''.
    Subsec. (f). Pub. L. 98-194, Sec. 3(d), added subsec. (f).
    1981--Subsec. (a). Pub. L. 97-35, Sec. 2704(a)(1)-(3), in 
introductory provisions inserted reference to assignment of member of 
Corps, and in par. (3) revised method and criteria for calculation of 
sums.
    Subsec. (b)(4). Pub. L. 97-35, Sec. 2704(a)(4), added par. (4).
    Subsec. (e). Pub. L. 97-35, Sec. 2704(b), substituted reference to 
sections 254d to 254h, and 254j of this title, for reference to this 
subpart.


                    Effective Date of 1983 Amendment

    Section 4 of Pub. L. 98-194 provided that: ``The amendments made by 
section 3 [amending this section] shall apply with respect to agreements 
entered into under section 334 of the Public Health Service Act [this 
section] after the date of the enactment of this Act [Dec. 1, 1983], 
but, to the extent feasible, the Secretary of Health and Human Services 
shall revise agreements entered into under such section 334 before such 
date to reflect the amendments made by section 3.''


                         Congressional Findings

    Section 2 of Pub. L. 98-194 provided that: ``Congress finds and 
declares that--
        ``(1) rural health clinics are an important part of America's 
    health care delivery system;
        ``(2) National Health Service Corps personnel assigned to rural 
    health clinics located in health manpower shortage areas have 
    provided valuable and needed staffing help for such clinics;
        ``(3) rural health clinics receiving assistance from National 
    Health Service Corps personnel should be expected to reimburse the 
    Federal Government for a reasonable share of the costs of such 
    personnel; and
        ``(4) the criteria which should be applied to reimbursement by 
    such clinics for use of such personnel should be a fair and 
    equitable one which reflects the needs of such clinics and the 
    populations served by such clinics, as well as the value of the 
    services rendered by such personnel.''

                  Section Referred to in Other Sections

    This section is referred to in sections 254f, 254i, 254k, 254l, 
254l-1, 254m, 11709 of this title.
