Substance Use Disorder Treatment and Behavioral and Mental Health Workforce Scholarship Program

(a)

In general

Part F of title VII of the Public Health Service Act (42 U.S.C. 295h) is amended by adding at the end the following:

782.

Substance Use Disorder Treatment and Behavioral and Mental Health Workforce Scholarship Program

(a)

Establishment

The Secretary, acting through the Administrator of the Health Resources and Services Administration, (in this section referred to as the Secretary) shall establish the Substance Use Disorder Treatment and Behavioral and Mental Health Workforce Scholarship Program (in this section referred to as the Scholarship Program) to award scholarships to assure an adequate supply of individuals in covered employment.(b)

Eligibility; application; written contract

To be eligible to participate in the Scholarship Program, an individual must—(1)be accepted for enrollment, or be enrolled, as a full-time student—(A)in an accredited (as determined by the Secretary) educational institution in a State; and(B)in a course of study or program, offered by such institution and approved by the Secretary, leading to covered employment;(2)submit an application to participate in the Scholarship Program; and(3)sign and submit to the Secretary, at the time of submittal of such application, a written contract (described in subsection (f)) to accept payment of a scholarship and to serve (in accordance with this section) for the applicable period of obligated service in a mental health professional shortage area.(c)

Review and evaluation of information and forms by prospective applicant

(1)

Contents of application and contract forms

In disseminating application forms and contract forms to individuals desiring to participate in the Scholarship Program, the Secretary shall include with such forms—(A)a fair summary of the rights and liabilities of an individual whose application is approved (and whose contract is accepted) by the Secretary, including in the summary a clear explanation of the damages to which the United States is entitled under subsection (j) in the case of the individual’s breach of the contract; and(B)such other information as may be necessary for the individual to understand the individual’s prospective participation in the Scholarship Program, including a statement of all factors considered in approving applications for participation in the Scholarship Program and in approving specific positions and employers that are eligible for the Scholarship Program.(2)

Clarity; availability

The application form, contract form, and all other information furnished by the Secretary under this section shall be written in a manner calculated to be understood by the average individual applying to participate in the Scholarship Program. The Secretary shall make such application forms, contract forms, and other information available to individuals desiring to participate in the Scholarship Program on a date sufficiently early to ensure that such individuals have adequate time to carefully review and evaluate such forms and information.(3)

Education and assistance

(A)

Distribution of informational materials

The Secretary shall distribute to health professions schools materials providing information on the Scholarship Program and shall encourage the schools to disseminate the materials to the students of the schools.(B)

End of obligated service

(i)

Encouragement to continue service

In the case of any health professional whose period of obligated service under the Scholarship Program is nearing completion, the Secretary shall encourage the individual to remain in a mental health professional shortage area and to continue in covered employment.(ii)

Assistance in transition

During the period in which a health professional is planning and making the transition from obligated service under the Scholarship Program, the Secretary may provide assistance to the professional regarding such transition if the professional is remaining in a mental health professional shortage area and is continuing in covered employment.(d)

Factors considered in providing contracts; priorities

(1)

Factors considered in providing contracts

In providing contracts under the Scholarship Program—(A)the Secretary shall consider the extent of the demonstrated interest of the applicants for the contracts in providing substance use disorder treatment and behavioral and mental health services; and(B)may consider such other factors regarding the applicants as the Secretary determines to be relevant to selecting qualified individuals to participate in such Program.(2)

Priorities

In providing contracts under the Scholarship Program, the Secretary shall give priority—(A)to any application for such a contract submitted by an individual who has characteristics that increase the probability that the individual will continue to serve in a mental health professional shortage area after the period of obligated service pursuant to subsection (f) is completed; and(B)to any application for such a contract submitted by an individual who is from a group or population that is underrepresented in the substance use disorder treatment and behavioral and mental health workforce.(e)

Commencement of participation in Scholarship Program; notice

(1)

Commencement of participation

An individual becomes a participant in the Scholarship Program only upon the Secretary’s approval of the individual’s application submitted under subsection (b)(2) and the Secretary’s acceptance of the contract submitted by the individual under subsection (b)(3).(2)

Notice

The Secretary shall provide written notice to an individual promptly upon the Secretary’s approving, under paragraph (1), of the individual’s participation in the Scholarship Program.(f)

Written contract; contents

The written contract (referred to in this section) between the Secretary and an individual shall contain—(1)an agreement that—(A)subject to paragraph (2), the Secretary agrees to provide the individual with a scholarship (described in subsection (g)) for a period of one or more school years during which the individual is pursuing a course of study described in subsection (b)(1)(B); and(B)subject to paragraph (2), the individual agrees—(i)to accept provision of such a scholarship to the individual;(ii)to maintain enrollment in a course of study described in subsection (b)(1)(B) until the individual completes the course of study;(iii)while enrolled in such course of study, to maintain an acceptable level of academic standing (as determined under regulations of the Secretary by the educational institution offering such course of study); and(iv)to serve for a time period (in this section referred to as the period of obligated service) equal to one year for each school year for which the individual was provided a scholarship under the Scholarship Program, in covered employment in a mental health professional shortage area (designated under section 332);(2)a provision that any financial obligation of the United States arising out of a contract entered into under this section and any obligation of the individual which is conditioned thereon, is contingent upon funds being appropriated for scholarships under this section;(3)a statement of the damages to which the United States is entitled, under subsection (j), for the individual’s breach of the contract; and(4)such other statements of the rights and liabilities of the Secretary and of the individual, not inconsistent with the provisions of this section.(g)

Scholarship provisions; contract with educational institution; increase in monthly stipend

(1)

Scholarship provisions

A scholarship provided to a student for a school year under a written contract under the Scholarship Program shall consist of payment to, or (in accordance with paragraph (2)) on behalf of, the student of the amount (except as provided in section 711) of—(A)the tuition of the student in such school year; and(B)all other reasonable educational expenses, including fees, books, and laboratory expenses, incurred by the student in such school year.(2)

Contract with educational institution

The Secretary may contract with an educational institution, in which a participant in the Scholarship Program is enrolled, for the payment to the educational institution of the amounts of tuition and other reasonable educational expenses described in paragraph (1). Payment to such an educational institution may be made without regard to section 3324 of title 31, United States Code.(h)

Employment ceiling of Department unaffected

Notwithstanding any other provision of law, individuals who have entered into written contracts with the Secretary under this section, while undergoing academic training, shall not be counted against any employment ceiling affecting the Department.(i)

Obligated service

Any individual receiving payments under the Scholarship Program as required by an agreement under this section shall agree to an annual commitment to work full-time in covered employment, with no more than 1 year passing between any 2 years of covered employment, in the United States in—(1)a mental health professional shortage area, as designated under section 332;(2)a county (or a municipality, if not contained within any county) where the mean drug overdose death rate per 100,000 people over the past 3 years for which official data is available from the State, is higher than the most recent available national average overdose death rate per 100,000 people, as reported by the Centers for Disease Control and Prevention; or(3)any facility, program, center, or clinic as determined appropriate by the Secretary for purposes of this section because of a shortage of mental health professionals, including private practices and other medical facilities designated under section 332(a) as having such a shortage.(j)

Breach

(1)

Liquidated damages formula

The Secretary may establish a liquidated damages formula to be used in the event of a breach of an agreement entered into under this section.(2)

Limitation

The failure by an individual to complete the full period of service obligated pursuant to such an agreement, taken alone, shall not constitute a breach of the agreement, so long as the individual completed in good faith the years of service for which payments were made to the individual under this section.(k)

Fund regarding use of amounts recovered for contract breach To replace services lost as result of breach

(1)

Establishment of Fund

There is established in the Treasury of the United States a fund to be known as the Substance Use Disorder Treatment and Behavioral and Mental Health Workforce Scholarship Program Replacement Fund (in this subsection referred to as the Fund). The Fund shall consist of such amounts as may be appropriated under paragraph (2) to the Fund. Amounts appropriated for the Fund shall remain available until expended.(2)

Authorization of Appropriations to Fund

For each fiscal year, there is authorized to be appropriated to the Fund an amount equal to the sum of—(A)the amount collected during the preceding fiscal year by the Federal Government pursuant to the liability of individuals under subsection (j) for the breach of contracts entered into under this section; and(B)the aggregate of the amount of interest accruing during the preceding fiscal year on obligations held in the Fund pursuant to paragraph (4) and the amount of proceeds from the sale or redemption of such obligations during such fiscal year.(3)

Use of Fund

(A)

Payments to certain health facilities

Amounts in the Fund and available pursuant to appropriations Acts may, subject to subparagraph (B), be expended by the Secretary to make payments to any entity that has a need for a health professional to provide substance use disorder treatment and behavioral and mental health services as a result of the breach by an individual of a contract entered into under this section.(B)

Purpose of payments

An entity receiving payments pursuant to subparagraph (A) may expend the payments to recruit and employ a health professional to provide substance use disorder treatment and behavioral and mental health services to patients of the entity, or to enter into a contract with such a professional to provide the services to the patients.(4)

Investment

(A)

In general

The Secretary of the Treasury shall invest such amounts of the Fund as such Secretary determines are not required to meet current withdrawals from the Fund. Such investments may be made only in interest-bearing obligations of the United States. For such purpose, such obligations may be acquired on original issue at the issue price, or by purchase of outstanding obligations at the market price.(B)

Sale of obligations

Any obligation acquired by the Fund may be sold by the Secretary of the Treasury at the market price.(l)

Covered employment defined

In this section, the term covered employment means—(1)full-time employment (including a fellowship) where the primary intent and function of the position is the direct treatment or recovery support of patients with or in recovery from a substance use, behavioral health, or mental health disorder; and(2)may include employment as a physician (with a degree of doctor of medicine or doctor of osteopathy), a psychiatric nurse, a social worker, a marriage and family therapist, a mental health counselor, an addiction counselor, an occupational therapist, a psychologist, a psychiatrist, a child and adolescent psychiatrist, or a neurologist.(m)

Authorization of appropriations

There is authorized to be appropriated to carry out this section $75,000,000 for each of fiscal years 2025 through 2029.

(b)

Exclusion of scholarship from gross income of the recipient

(1)

In general

Section 117(c)(2) of the Internal Revenue Code of 1986 is amended by striking or at the end of subparagraph (B), by striking the period at the end of subparagraph (C) and inserting , or, and by adding at the end the following new subparagraph:

(D)section 782 of the Public Health Service Act.

(2)

Effective date

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