
From the U.S. Code Online via GPO Access
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[Laws in effect as of January 23, 2000]
[Document not affected by Public Laws enacted between
  January 23, 2000 and December 4, 2001]
[CITE: 42USC300e-5]

 
                 TITLE 42--THE PUBLIC HEALTH AND WELFARE
 
                    CHAPTER 6A--PUBLIC HEALTH SERVICE
 
             SUBCHAPTER XI--HEALTH MAINTENANCE ORGANIZATIONS
 
Sec. 300e-5. Application requirements


(a) Submission to and approval by Secretary required for making loans 
        and loan guarantees

    No loan or loan guarantee may be made under this subchapter unless 
an application therefor has been submitted to, and approved by, the 
Secretary.

(b) Application contents

    The Secretary may not approve an application for a loan or loan 
guarantee under this subchapter unless--
        (1) such application meets the requirements of section 300e-7 of 
    this title;
        (2) in the case of an application for assistance under section 
    300e-4 of this title, he determines that the applicant making the 
    application would not be able to complete the project or undertaking 
    for which the application is submitted without the assistance 
    applied for;
        (3) the application contains satisfactory specification of the 
    existing or anticipated (A) population group or groups to be served 
    by the proposed or existing health maintenance organization 
    described in the application, (B) membership of such organization, 
    (C) methods, terms, and periods of the enrollment of members of such 
    organization, (D) estimated costs per member of the health and 
    educational services to be provided by such organization and the 
    nature of such costs, (E) sources of professional services for such 
    organization, and organizational arrangements of such organization 
    for providing health and educational services, (F) organizational 
    arrangements of such organization for an ongoing quality assurance 
    program in conformity with the requirements of section 300e(c) of 
    this title, (G) sources of prepayment and other forms of payment for 
    the services to be provided by such organization, (H) facilities, 
    and additional capital investments and sources of financing 
    therefor, available to such organization to provide the level and 
    scope of services proposed, (I) administrative, managerial, and 
    financial arrangements and capabilities of such organization, (J) 
    role for members in the planning and policymaking for such 
    organization, (K) grievance procedures for members of such 
    organization, and (L) evaluations of the support for and acceptance 
    of such organization by the population to be served, the sources of 
    operating support, and the professional groups to be involved or 
    affected thereby;
        (4) contains or is supported by assurances satisfactory to the 
    Secretary that the applicant making the application will, in 
    accordance with such criteria as the Secretary shall by regulation 
    prescribe, enroll, and maintain an enrollment of the maximum number 
    of members that its available and potential resources (as determined 
    under regulations of the Secretary) will enable it to effectively 
    serve;
        (5) in the case of an application made for a project which 
    previously received a grant, contract, loan, or loan guarantee under 
    this subchapter, such application contains or is supported by 
    assurances satisfactory to the Secretary that the applicant making 
    the application has the financial capability to adequately carry out 
    the purposes of such project and has developed and operated such 
    project in accordance with the requirements of this subchapter and 
    with the plans contained in previous applications for such 
    assistance;
        (6) the application contains such assurances as the Secretary 
    may require respecting the intent and the ability of the applicant 
    to meet the requirements of paragraphs (1) and (2) of section 
    300e(b) of this title respecting the fixing of basic health services 
    payments and supplemental health services payments under a community 
    rating system; and
        (7) the application is submitted in such form and manner, and 
    contains such additional information, as the Secretary shall 
    prescribe in regulations.

An organization making multiple applications for more than one loan or 
loan guarantee under this subchapter, simultaneously or over the course 
of time, shall not be required to submit duplicate or redundant 
information but shall be required to update the specifications (required 
by paragraph (3)) respecting the existing or proposed health maintenance 
organization in such manner and with such frequency as the Secretary may 
by regulation prescribe. In determining, for purposes of paragraph (2), 
whether an applicant would be able to complete a project or undertaking 
without the assistance applied for, the Secretary shall not consider any 
asset of the applicant the obligation of which for such undertaking or 
project would jeopardize the fiscal soundness of the applicant.

(c) Regulations

    The Secretary shall by regulation establish standards and procedures 
for health systems agencies to follow in reviewing and commenting on 
applications for loans and loan guarantees under this subchapter.

(July 1, 1944, ch. 373, title XIII, Sec. 1306, as added Pub. L. 93-222, 
Sec. 2, Dec. 29, 1973, 87 Stat. 925; amended Pub. L. 94-460, title I, 
Secs. 105(a)(3), 117(b)(5), (6), Oct. 8, 1976, 90 Stat. 1948, 1955; Pub. 
L. 95-559, Sec. 12(b), (c), Nov. 1, 1978, 92 Stat. 2140; Pub. L. 99-660, 
title VIII, Secs. 803(b)(1), 805(b), 806, Nov. 14, 1986, 100 Stat. 3799, 
3800.)


                               Amendments

    1986--Subsec. (a). Pub. L. 99-660, Sec. 803(b)(1)(A), substituted 
``loan'' for ``grant, contract, loan,''.
    Subsec. (b). Pub. L. 99-660, Sec. 803(b)(1)(A), substituted ``loan'' 
for ``grant, contract, loan,'' in introductory text and in second 
sentence.
    Subsec. (b)(1). Pub. L. 99-660, Sec. 803(b)(1)(B), struck out ``in 
the case of an application for assistance under section 300e-2 or 300e-3 
of this title, such application meets the application requirements of 
such section and in the case of an application for a loan or loan 
guarantee,'' before ``such application''.
    Subsec. (b)(2). Pub. L. 99-660, Sec. 805(b), struck out reference to 
section 300e-4a.
    Pub. L. 99-660, Sec. 803(b)(1)(C), struck out reference to section 
300e-3.
    Subsec. (b)(5) to (8). Pub. L. 99-660, Sec. 806, redesignated pars. 
(6), (7), and (8) as (5), (6), and (7), respectively, and struck out 
former par. (5) which read as follows: ``each health systems agency 
designated for a health service area which covers (in whole or in part) 
the area to be served by the health maintenance organization for which 
such application is submitted;''.
    Subsec. (c). Pub. L. 99-660, Sec. 803(b)(1)(D), substituted 
``loans'' for ``grants, contracts, loans,''.
    1978--Subsec. (b). Pub. L. 95-559 in par. (2) inserted ``in the case 
of an application for assistance under section 300e-3, 300e-4, or 300e-
4a of this title,'' before ``he determines'' and in provisions following 
par. (8) inserted provision that in determining, for purposes of par. 
(2), whether an applicant would be able to complete a project or 
undertaking without the assistance applied for, the Secretary not 
consider any asset of the applicant the obligation of which for such 
undertaking or project would jeopardize the fiscal soundness of the 
applicant.
    1976--Subsec. (b)(5). Pub. L. 94-460, Sec. 117(b)(5), substituted 
``each health systems agency designated for a health service area which 
covers (in whole or in part) the area to be served by the health 
maintenance organization for which such application is submitted;'' for 
``the section 314(b) areawide health planning agency whose section 
314(b) plan covers (in whole or in part) the area to be served by the 
health maintenance organization for which such application is submitted, 
or if there is no such agency, the section 314(a) State health planning 
agency whose section 314(a) plan covers (in whole or in part) such area, 
has, in accordance with regulations of the Secretary under subsection 
(c) of this section, been provided an opportunity to review the 
application and to submit to the Secretary for his consideration its 
recommendations respecting approval of the application or if under 
applicable State law such an application may not be submitted without 
the approval of the section 314(b) areawide health planning agency or 
the section 314(a) State health planning agency, the required approval 
has been obtained;''.
    Subsec. (b)(7), (8). Pub. L. 94-460, Sec. 105(a)(3), added par. (7) 
and redesignated former par. (7) as (8).
    Subsec. (c). Pub. L. 94-460, Sec. 117(b)(6), substituted ``health 
systems agencies'' for ``section 314(b) areawide health planning 
agencies and section 314(a) State health planning agencies''.


                    Effective Date of 1986 Amendment

    Section 803(c) of Pub. L. 99-660 provided that: ``The amendments 
made by this section [amending this section and sections 300e-6, 300e-8, 
and 300e-16 of this title and repealing sections 300e-2 and 300e-3 of 
this title] do not apply to any grant made or contract entered into 
under title XIII of the Public Health Service Act [this subchapter] 
before October 1, 1985.''
    Section 805(c) of Pub. L. 99-660 provided that: ``The amendments 
made by this section [amending this section and repealing section 300e-
4a of this title] do not apply to any loan or loan guarantee made under 
section 1305A of the Public Health Service Act [former section 300e-4a 
of this title] before October 1, 1985.''
    Amendment by Pub. L. 99-660 effective Oct. 1, 1985, see section 
815(a) of Pub. L. 99-660, set out as an Effective and Termination Dates 
of 1986 Amendment note under section 300e-1 of this title.


                    Effective Date of 1976 Amendment

    Amendment by Pub. L. 94-460 effective Oct. 8, 1976, see section 118 
of Pub. L. 94-460, set out as a note under section 300e of this title.

                  Section Referred to in Other Sections

    This section is referred to in sections 300e-6, 300e-16 of this 
title.
