Short title

This Act may be cited as the

Improving Physician Access in Teaching Hospitals (PATH) Act of 2011

Distribution of additional residency slots

Section 1886(h) of the Social Security Act (42 U.S.C. 1395ww(h)) is amended— (1)in paragraph (7)(E), by inserting paragraph (9), after paragraph (8),; and (2)by adding at the end the following:

(9)

Distribution of additional residency positions

(A)

Reductions in limit based on unused positions

(i)

In general

Except as provided in clause (ii), if a hospital's resident level (as defined in paragraph (7)(C)(i)) for each of the 5 most recent cost reporting periods (ending before the date of the enactment of this paragraph) of the hospital for which a cost report has been settled (or, if not, submitted subject to audit) as determined by the Secretary is less than the otherwise applicable resident limit (as defined in paragraph (8)(H)(iii)), effective for portions of cost reporting periods occurring on or after the paragraph (9) effective date (as defined in subparagraph (E)), the otherwise applicable resident limit shall be reduced by the difference between such otherwise applicable resident limit and the highest such reference resident level for any of such 5 cost reporting periods. (ii)

Exception

Clause (i) shall not apply to— (I)a hospital located in a rural area with fewer than 250 beds; or (II)a hospital that has had in effect a voluntary residency reduction plan under paragraph (6) or pursuant to section 402 of Public Law 90–248. (B)

Requirements for additional residency slots

(i)

In general

The Secretary shall increase the otherwise applicable resident limit for hospitals that submit an application under this subparagraph by such number as the Secretary may approve for portions of cost reporting periods occurring on or after the paragraph (9) effective date. The aggregate number of increases in the otherwise applicable resident limit under this subparagraph shall be equal to the sum of— (I)the aggregate reduction in such limits attributable to subparagraph (A) (as estimated by the Secretary); and (II)1,000 for portions of cost reporting periods occurring during the 12-month period beginning on the paragraph (9) effective date, 1,000 additional positions for portions of cost reporting periods occurring during the 12-month period beginning 1 year after such effective date, 1,000 additional positions for portion of cost reporting period occurring during the 12-month period beginning 2 years after such effective date, and such number of additional positions for portions of the 2 subsequent cost reporting periods as the Secretary may determine necessary to support residency training programs in specialities that exceed 3 years. (ii)

Consideration in redistribution

In determining for which hospitals the increase in the otherwise applicable resident limit is provided under this subparagraph, the Secretary shall take into account— (I)data provided by the Health Resources and Services Administration as a national standard to exhibit a specific demand in the health care workforce, as well as the Administration’s projected demand and supply for physicians in the specialty of medicine involved; and (II)the demonstrated likelihood of the hospital filling positions made available under this paragraph within the first 3 cost reporting periods beginning on or after the paragraph (9) effective date.

The Secretary shall give special consideration for up to 25 additional positions in the case of a hospital that demonstrates the likelihood of filing such positions during the first cost reporting period beginning on or after such effective date.

(iii)

Limitation

In no case shall the number of additional positions made available to a hospital under this paragraph exceed 25 in the first cost reporting period or 75 for all cost reporting periods. (C)

Priority for additional positions resulting from hospital closures

With respect to additional positions described in subparagraph (B)(i)(I) which are derived from a reduction in limits under subparagraph (A) for a hospital that closed (in this subparagraph referred to as a closed hospital), the Secretary shall distribute the increase to hospitals in the following priority order: (i)First, to other hospitals for the program or programs under which the hospital had a cooperative arrangement with the closed hospital under which residents in the graduate medical education program of the closed hospital also rotated through the other hospital. (ii)Second, to other hospitals that are members of the same affiliated group of hospitals as the closed hospital. (iii)Third, to other hospitals that are located in the same or contiguous core-based statistical area as the closed hospital. (D)

Preference

After applying subparagraph (C) and the special consideration under subparagraph (B), in determining for which hospitals the increase in the otherwise applicable resident limit is provided under subparagraph (B), the Secretary shall give preference to hospitals— (i)that submit an application for new residents in primary care and geriatric medicine and in other specialties as determined to be in demand under subparagraph (B)(ii)(I); and (ii)that emphasize training in community health centers and other community-based or hospital-sponsored clinics, and private physicians’ offices, including physician groups. (E)

Paragraph (9) effective date defined

In this paragraph, the term paragraph (9) effective date means July 1 of the year that begins after the date of the enactment of this paragraph. (F)

Affiliation

The provisions of this paragraph shall be applied to hospitals which are members of the same affiliated group (as defined by the Secretary under paragraph (4)(H)(ii)) and the reference resident level for each such hospital with respect to the cost reporting period that results in the smallest difference between the reference resident level and the otherwise applicable resident limit.

Expanding primary care bonus to certain underserved specialties

(a)

In general

Section 1833(x)(2)(A) of the Social Security Act (42 U.S.C. 1395l(x)(2)(A)) is amended— (1)in clause (i)— (A)by striking or at the end of subclause (I); (B)by striking and at the end of subclause (II) and inserting or; and (C)by adding at the end the following new subclause:

(III)is a physician (as described in section 1861(r)(1)) who is in an underserved specialty, such as psychiatry or neurology, as specified by the Secretary, or other specialty identified by the Secretary to be in demand; and

; and

(2)in clause (ii), by inserting after (ii) the following: in the case of an individual described in subclause (I) or (II) of clause (i),. (b)

Effective date

The amendments made by subsection (a) shall apply to payments for items and services furnished on or after January 1, 2012.

Small physician practice residency credit

(a)

In general

Subpart D of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 (relating to business related credits) is amended by adding at the end the following new section:

45S.

Small physician practice residency credit

(a)

In general

For purposes of section 38, the amount of the small physician practice residency credit determined under this section for any taxable year with respect to a qualified small physician practice is the sum of the following: (1)

Overall amount

The per resident dollar amount multiplied by the number of qualified teaching hospital residents who provide services to, and are trained by, such practice during the taxable year and who are in their first, second, or third post-graduate year of medical residency. (2)

Bonus

The sum of— (A)50 percent of the per resident dollar amount multiplied by the number of such residents who are in their first post-graduate year of medical residency during the taxable year; and (B)25 percent of the per resident dollar amount multiplied by the average number of such residents who are not counted under subparagraph (A) and are in their second post-graduate year during the taxable year. (b)

Qualified small physician practice

For purposes of this section, the term qualified small physician practice means any trade or business of providing physicians’ services (as defined in section 1861(q) of the Social Security Act), which may be a community health center, that is owned and operated by a doctor of medicine or osteopathy if fewer than 50 individuals are employed in such trade or business (including new training sites) and the trade or business includes as part of the practice the training of doctors of medicine or osteopathy in a rotation covering at least 6 months in the taxable year. All persons treated as a single employer under subsection (a) or (b) or section 52 or subsection (m) or (o) of section 414 shall be treated as a single trade or business for purposes of the preceding sentence. (c)

Qualified teaching hospital residents

For purposes of this section, the term qualified teaching hospital resident means any resident (within the meaning of subparagraph (I) of section 1886(h)(5) of the Social Security Act) in an approved medical residency training program (as defined in subparagraph (A) of such section) which provides services to the qualified small physician practice (while utilizing the technologies and supplies of such practice) for a period not less than— (1)4 weeks in the case of a primary care resident (as defined in subparagraph (H) of such section); or (2)2 weeks in the case of any other resident. (d)

Per resident dollar amount

For purposes of this section, the term per resident dollar amount means, in the case of a qualified small physician practice that includes as part of the practice the training of doctors of medicine or osteopathy in a rotation covering— (1)at least 6 months but less than 9 months in the taxable year, $2,500; or (2)at least 9 months in the taxable year, $3,000. (e)

Residents not taken into account more than once

A qualified teaching hospital resident shall be taken into account under subsection (a) for the taxable in which the period described in subsection (c) ends and shall not be so taken into account for any other taxable year.

(b)

Credit allowed as part of general business credit

Section 38(b) of such Code (defining current year business credit) is amended by striking plus at the end of paragraph (35), by striking the period at the end of paragraph (36) and inserting , plus, and by adding at the end the following new paragraph:

(37)the small physician practice residency credit determined under section 45S(a).

(c)

Conforming amendment

The table of sections for subpart D of part IV of subchapter A of chapter 1 of such Code is amended by adding at the end the following new item:

Sec. 45S. Small physician practice residency credit.

(d)

Effective date

The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.