[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[S. 1806 Referred in House (RFH)]

  2d Session
                                S. 1806


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            October 7, 2002

            Referred to the Committee on Energy and Commerce

_______________________________________________________________________

                                 AN ACT


 
     To amend the Public Health Service Act with respect to health 
        professions programs regarding the practice of pharmacy.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Pharmacy Education Aid Act of 
2002''.

SEC. 2. FINDINGS.

    Congress makes the following findings:
            (1) Pharmacists are an important link in our Nation's 
        health care system. A critical shortage of pharmacists is 
        threatening the ability of pharmacies to continue to provide 
        important prescription related services.
            (2) In the landmark report entitled ``To Err is Human: 
        Building a Safer Health System'', the Institute of Medicine 
        reported that medication errors can be partially attributed to 
        factors that are indicative of a shortage of pharmacists (such 
        as too many customers, numerous distractions, and staff 
        shortages).
            (3) Congress acknowledged in the Healthcare Research and 
        Quality Act of 1999 (Public Law 106-129) a growing demand for 
        pharmacists by requiring the Secretary of Health and Human 
        Services to conduct a study to determine whether there is a 
        shortage of pharmacists in the United States and, if so, to 
        what extent.
            (4) As a result of Congress' concern about how a shortage 
        of pharmacists would impact the public health, the Secretary of 
        Health and Human Services published a report entitled ``The 
        Pharmacist Workforce: A Study in Supply and Demand for 
        Pharmacists'' in December of 2000.
            (5) ``The Pharmacist Workforce: A Study in Supply and 
        Demand for Pharmacists'' found that ``While the overall supply 
        of pharmacists has increased in the past decade, there has been 
        an unprecedented demand for pharmacists and for pharmaceutical 
        care services, which has not been met by the currently 
        available supply'' and that the ``evidence clearly indicates 
        the emergence of a shortage of pharmacists over the past two 
        years''.
            (6) The same study also found that ``The factors causing 
        the current shortage are of a nature not likely to abate in the 
        near future without fundamental changes in pharmacy practice 
        and education.'' The study projects that the number of 
        prescriptions filled by community pharmacists will increase by 
        20 percent by 2004. In contrast, the number of community 
        pharmacists is expected to increase by only 6 percent by 2005.
            (7) The demand for pharmacists will increase as 
        prescription drug use continues to grow.

SEC. 3. HEALTH PROFESSIONS PROGRAM RELATED TO THE PRACTICE OF PHARMACY.

    (a) In General.--Part E of title VII of the Public Health Service 
Act (42 U.S.C. 294n et seq.) is amended by adding at the end the 
following:

              ``Subpart 3--Pharmacy Workforce Development

``SEC. 781. LOAN REPAYMENT PROGRAM.

    ``(a) In General.--In the case of any individual--
            ``(1) who has received a baccalaureate degree in pharmacy 
        or a Doctor of Pharmacy degree from an accredited program; and
            ``(2) who obtained an educational loan for pharmacy 
        education costs;
the Secretary may enter into an agreement with such individual who 
agrees to serve as a full-time pharmacist for a period of not less than 
2 years at a health care facility with a critical shortage of 
pharmacists, to make payments in accordance with subsection (b), for 
and on behalf of that individual, on the principal of and interest on 
any loan of that individual described in paragraph (2) which is 
outstanding on the date the individual begins such service.
    ``(b) Manner of Payments.--
            ``(1) In general.--The payments described in subsection (a) 
        may consist of payment, in accordance with paragraph (2), on 
        behalf of the individual of the principal, interest, and 
        related expenses on government and commercial loans received by 
        the individual regarding the undergraduate or graduate 
        education of the individual (or both), which loans were made 
        for--
                    ``(A) tuition expenses;
                    ``(B) all other reasonable educational expenses, 
                including fees, books, and laboratory expenses, 
                incurred by the individual; or
                    ``(C) reasonable living expenses as determined by 
                the Secretary.
            ``(2) Payments for years served.--
                    ``(A) In general.--For each year of obligated 
                service that an individual contracts to serve under 
                subsection (a)(3) the Secretary may pay up to $35,000 
                on behalf of the individual for loans described in 
                paragraph (1). In making a determination of the amount 
                to pay for a year of such service by an individual, the 
                Secretary shall consider the extent to which each such 
                determination--
                            ``(i) affects the ability of the Secretary 
                        to maximize the number of agreements that may 
                        be provided under this section from the amounts 
                        appropriated for such agreements;
                            ``(ii) provides an incentive to serve in 
                        areas with the greatest shortages of 
                        pharmacists; and
                            ``(iii) provides an incentive with respect 
                        to the pharmacist involved remaining in the 
                        area and continuing to provide pharmacy 
                        services after the completion of the period of 
                        obligated service under agreement.
                    ``(B) Repayment schedule.--Any arrangement made by 
                the Secretary for the making of loan repayments in 
                accordance with this subsection shall provide that any 
                repayments for a year of obligated service shall be 
                made not later than the end of the fiscal year in which 
                the individual completes such year of service.
            ``(3) Tax liability.--For the purpose of providing 
        reimbursements for tax liability resulting from payments under 
        paragraph (2) on behalf of an individual--
                    ``(A) the Secretary shall, in addition to such 
                payments, make payments to the individual in an amount 
                equal to 39 percent of the total amount of loan 
                repayments made for the taxable year involved; and
                    ``(B) may make such additional payments as the 
                Secretary determines to be appropriate with respect to 
                such purpose.
            ``(4) Payment schedule.--The Secretary may enter into an 
        agreement with the holder of any loan for which payments are 
        made under this section to establish a schedule for the making 
        of such payments.
    ``(c) Preferences.--In entering into agreements under subsection 
(a), the Secretary shall give preference to qualified applicants with 
the greatest financial need.
    ``(d) Reports.--
            ``(1) Annual report.--Not later than 18 months after the 
        date of enactment of the Pharmacy Education Aid Act, and 
        annually thereafter, the Secretary shall prepare and submit to 
        Congress a report describing the program carried out under this 
        section, including statements regarding--
                    ``(A) the number of enrollees, loan repayments, and 
                recipients;
                    ``(B) the number of graduates;
                    ``(C) the amount of loan repayments made;
                    ``(D) which educational institution the recipients 
                attended;
                    ``(E) the number and placement location of the loan 
                repayment recipients at health care facilities with a 
                critical shortage of pharmacists;
                    ``(F) the default rate and actions required;
                    ``(G) the amount of outstanding default funds of 
                the loan repayment program;
                    ``(H) to the extent that it can be determined, the 
                reason for the default;
                    ``(I) the demographics of the individuals 
                participating in the loan repayment program; and
                    ``(J) an evaluation of the overall costs and 
                benefits of the program.
            ``(2) 5-year report.--Not later than 5 years after the date 
        of enactment of the Pharmacy Education Aid Act, the Secretary 
        shall prepare and submit to Congress a report on how the 
        program carried out under this section interacts with other 
        Federal loan repayment programs for pharmacists and determining 
        the relative effectiveness of such programs in increasing 
        pharmacists practicing in areas with a critical shortage or 
        pharmacists.
    ``(e) Breach of Agreement.--
            ``(1) In general.--In the case of any program under this 
        section under which an individual makes an agreement to provide 
        health services for a period of time in accordance with such 
        program in consideration of receiving an award of Federal funds 
        regarding education as a pharmacists (including an award for 
        the repayment of loans), the following applies if the agreement 
        provides that this subsection is applicable:
                    ``(A) In the case of a program under this section 
                that makes an award of Federal funds for attending an 
                accredited program of pharmacy (in this section 
                referred to as a `pharmacy program'), the individual is 
                liable to the Federal Government for the amount of such 
                award (including amounts provided for expenses related 
                to such attendance), and for interest on such amount at 
                the maximum legal prevailing rate, if the individual--
                            ``(i) fails to maintain an acceptable level 
                        of academic standing in the pharmacy program 
                        (as indicated by the program in accordance with 
                        requirements established by the Secretary);
                            ``(ii) is dismissed from the pharmacy 
                        program for disciplinary reasons; or
                            ``(iii) voluntarily terminates the pharmacy 
                        program.
                    ``(B) The individual is liable to the Federal 
                Government for the amount of such award (including 
                amounts provided for expenses related to such 
                attendance), and for interest on such amount at the 
                maximum legal prevailing rate, if the individual fails 
                to provide health services in accordance with the 
                program under this section for the period of time 
                applicable under the program.
            ``(2) Waiver or suspension of liability.--In the case of an 
        individual or health facility making an agreement for purposes 
        of paragraph (1), the Secretary shall provide for the waiver or 
        suspension of liability under such subsection if compliance by 
        the individual or the health facility, as the case may be, with 
        the agreements involved is impossible, or would involve extreme 
        hardship to the individual or facility, and if enforcement of 
        the agreements with respect to the individual or facility would 
        be unconscionable.
            ``(3) Date certain for recovery.--Subject to paragraph (2), 
        any amount that the Federal Government is entitled to recover 
        under paragraph (1) shall be paid to the United States not 
        later than the expiration of the 3-year period beginning on the 
        date the United States becomes so entitled.
            ``(4) Availability.--Amounts recovered under paragraph (1) 
        with respect to a program under this section shall be available 
        for the purposes of such program, and shall remain available 
        for such purposes until expended.
    ``(f) Definition.--In this section, the term `health care facility' 
means an Indian Health Service health center, a Native Hawaiian health 
center, a hospital, a pharmacy, a Federal qualified health center, a 
rural health clinic, a nursing home, a home health agency, a hospice 
program, a public health clinic, a State or local department of public 
health, a skilled nursing facility, an ambulatory surgical center, or 
any other facility determined appropriate by the Secretary.
    ``(g) Authorization of Appropriations.--For the purpose of payments 
under agreements entered into under subsection (a), there are 
authorized to be appropriated such sums as may be necessary for each of 
fiscal years 2003 through 2007.

``SEC. 782. PHARMACIST FACULTY LOAN PROGRAM.

    ``(a) Establishment.--The Secretary, acting through the 
Administrator of the Health Resources and Services Administration, may 
enter into an agreement with any school of pharmacy for the 
establishment and operation of a student loan fund in accordance with 
this section, to increase the number of qualified pharmacy faculty.
    ``(b) Agreements.--Each agreement entered into under subsection (a) 
shall--
            ``(1) provide for the establishment of a student loan fund 
        by the school involved;
            ``(2) provide for deposit in the fund of--
                    ``(A) the Federal capital contributions to the 
                fund;
                    ``(B) an amount equal to not less than one-ninth of 
                such Federal capital contributions, contributed by such 
                school;
                    ``(C) collections of principal and interest on 
                loans made from the fund; and
                    ``(D) any other earnings of the fund;
            ``(3) provide that the fund will be used only for loans to 
        students of the school in accordance with subsection (c) and 
        for costs of collection of such loans and interest thereon;
            ``(4) provide that loans may be made from such fund only to 
        students pursuing a full-time course of study or, at the 
        discretion of the Secretary, a part-time course of study; and
            ``(5) contain such other provisions as are necessary to 
        protect the financial interests of the United States.
    ``(c) Loan Provisions.--Loans from any student loan fund 
established by a school pursuant to an agreement under subsection (a) 
shall be made to an individual on such terms and conditions as the 
school may determine, except that--
            ``(1) such terms and conditions are subject to any 
        conditions, limitations, and requirements prescribed by the 
        Secretary;
            ``(2) in the case of any individual, the total of the loans 
        for any academic year made by schools of pharmacy from loan 
        funds established pursuant to agreements under subsection (a) 
        may not exceed $30,000, plus any amount determined by the 
        Secretary on an annual basis to reflect inflation;
            ``(3) an amount up to 85 percent of any such loan (plus 
        interest thereon) shall be canceled by the school as follows:
                    ``(A) upon completion by the individual of each of 
                the first, second, and third year of full-time 
                employment, required by the loan agreement entered into 
                under this subsection, as a faculty member in a school 
                of pharmacy, the school shall cancel 20 percent of the 
                principle of, and the interest on, the amount of such 
                loan unpaid on the first day of such employment; and
                    ``(B) upon completion by the individual of the 
                fourth year of full-time employment, required by the 
                loan agreement entered into under this subsection, as a 
                faculty member in a school of pharmacy, the school 
                shall cancel 25 percent of the principle of, and the 
                interest on, the amount of such loan unpaid on the 
                first day of such employment;
            ``(4) such a loan may be used to pay the cost of tuition, 
        fees, books, laboratory expenses, and other reasonable 
        education expenses;
            ``(5) such a loan shall be repayable in equal or graduated 
        periodic installments (with the right of the borrower to 
        accelerate repayment) over the 10-year period that begins 9 
        months after the individual ceases to pursue a course of study 
        at a school of pharmacy; and
            ``(6) such a loan shall--
                    ``(A) beginning on the date that is 3 months after 
                the individual ceases to pursue a course of study at a 
                school of pharmacy, bear interest on the unpaid balance 
                of the loan at the rate of 3 percent per annum; or
                    ``(B) subject to subsection (e), if the school of 
                pharmacy determines that the individual will not 
                complete such course of study or serve as a faculty 
                member as required under the loan agreement under this 
                subsection, bear interest on the unpaid balance of the 
                loan at the prevailing market rate.
    ``(d) Payment of Proportionate Share.--Where all or any part of a 
loan, or interest, is canceled under this section, the Secretary shall 
pay to the school an amount equal to the school's proportionate share 
of the canceled portion, as determined by the Secretary.
    ``(e) Review by Secretary.--At the request of the individual 
involved, the Secretary may review any determination by a school of 
pharmacy under subsection (c)(6)(B).
    ``(f) Information Technology.--The Secretary may make awards of 
grants or contracts to qualifying schools of pharmacy for the purpose 
of assisting such schools in acquiring and installing computer-based 
systems to provide pharmaceutical education. Education provided through 
such systems may be graduate education, professional education, or 
continuing education. The computer-based systems may be designed to 
provide on-site education, or education at remote sites (commonly 
referred to as distance learning), or both.
    ``(g) Requirement Regarding Education in Practice of Pharmacy.--
With respect to the school of pharmacy involved, the Secretary shall 
ensure that programs and activities carried out with Federal funds 
provided under this section have the goal of educating students to 
become licensed pharmacists, or the goal of providing for faculty to 
recruit, retain, and educate students to become licensed pharmacists.
    ``(h) Definitions.--For purposes of this section:
            ``(1) School of pharmacy.--the term `school of pharmacy' 
        means a college or school of pharmacy (as defined in section 
        799B) that, in providing clinical experience for students, 
        requires that the students serve in a clinical rotation in 
        which pharmacist services (as defined in section 331(a)(3)(E)) 
        are provided at or for--
                    ``(A) a medical facility that serves a substantial 
                number of individuals who reside in or are members of a 
                medically underserved community (as so defined);
                    ``(B) an entity described in any of subparagraphs 
                (A) through (L) of section 340B(a)(4) (relating to the 
                definition of covered entity);
                    ``(C) a health care facility of the Department of 
                Veterans Affairs or of any of the Armed Forces of the 
                United States;
                    ``(D) a health care facility of the Bureau of 
                Prisons;
                    ``(E) a health care facility operated by, or with 
                funds received from, the Indian Health Service; or
                    ``(F) a disproportionate share hospital under 
                section 1923 of the Social Security Act.
            ``(2) Pharmacist services.--The term `pharmacist services' 
        includes drug therapy management services furnished by a 
        pharmacist, individually or on behalf of a pharmacy provider, 
        and such services and supplies furnished incident to the 
        pharmacist's drug therapy management services, that the 
        pharmacist is legally authorized to perform (in the State in 
        which the individual performs such services) in accordance with 
        State law (or the State regulatory mechanism provided for by 
        State law).
    ``(i) Authorization of Appropriations.--For the purpose of carrying 
out this section, there are authorized to be appropriated such sums as 
may be necessary for each of the fiscal years 2003 through 2007.''.

            Passed the Senate October 3, 2002.

            Attest:

                                                  JERI THOMSON,

                                                             Secretary.