[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 3840 Introduced in Senate (IS)]
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119th CONGRESS
2d Session
S. 3840
To provide for the designation of areas as Health Investment Zones to
reduce health disparities and improve health outcomes in such areas,
and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
February 11, 2026
Mr. Padilla introduced the following bill; which was read twice and
referred to the Committee on Finance
_______________________________________________________________________
A BILL
To provide for the designation of areas as Health Investment Zones to
reduce health disparities and improve health outcomes in such areas,
and for other purposes.
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 ``Health Investment Zones Act of
2026''.
SEC. 2. DESIGNATION OF HEALTH INVESTMENT ZONES.
(a) Designation.--
(1) In general.--Not later than 2 years after the date of
enactment of this Act, the Secretary shall, pursuant to
applications submitted under subsection (c), designate areas as
Health Investment Zones to reduce health disparities and
improve health outcomes in such areas.
(2) Eligibility of area.--To be designated as a Health
Investment Zone under this section, an area shall--
(A) be a contiguous geographic area; and
(B) have measurable and documented geographic
health disparities and poor health outcomes,
demonstrated by--
(i) average income below 150 percent of the
Federal poverty line (as defined by the Office
of Management and Budget based on the most
recent data available from the Bureau of the
Census);
(ii) a rate of participation in the special
supplemental nutrition program under section 17
of the Child Nutrition Act of 1966 (42 U.S.C.
1786) that is higher than the national average
rate of participation in such program;
(iii) lower life expectancy than the
national average;
(iv) a higher percentage of instances of
low birth weight than the national average; or
(v) designation under section 332 of the
Public Health Service Act (42 U.S.C. 254e) as a
health professional shortage area.
(3) Publication of designee information.--Not later than 1
year after the date on which all areas are designated as Health
Investment Zones under paragraph (1), the Secretary shall
publish on the website of the Department of Health and Human
Services--
(A) the name of each such Health Investment Zone,
together with the names of each coalition partner; and
(B) a description of all areas so designated.
(b) Solicitation of Applications.--Not later than 1 year after the
date of enactment of this Act, the Secretary shall solicit applications
under subsection (c).
(c) Submission of Applications.--
(1) In general.--To seek the designation of an area as a
Health Investment Zone, a community-based nonprofit
organization or local governmental agency, in coalition with
health care providers, hospitals, nonprofit community health
clinics, health centers, social service organizations, and
other related organizations, shall submit an application to the
Secretary.
(2) Applications for grants.--As part of an application
under this subsection, a community-based nonprofit organization
or local governmental agency may include an application for a
grant under section 4(a). Such community-based nonprofit
organization or local governmental agency shall describe how
the use of grant funds would be consistent with the plan
submitted pursuant to subsection (d)(1) and whether such
community-based nonprofit organization or local governmental
agency intends to award subgrants or implement innovative
public health strategies under section 4(b).
(d) Contents.--An application under subsection (c) shall--
(1) include an effective and sustainable plan with respect
to the area proposed for designation--
(A) to reduce health disparities;
(B) to reduce the costs of, or to produce savings
to, the health care system;
(C) to improve health outcomes; and
(D) to utilize one or more of the incentives
established pursuant to section 5, section 51 of the
Internal Revenue Code of 1986 (as amended by section
3(a)), for wages paid to qualified Health Investment
Zone workers (as defined in section 51(d)(16) of such
Code), section 25G of the Internal Revenue Code of 1986
(as added by section 3(b)), or subsection (ee) of
section 1833 of the Social Security Act (42 U.S.C.
1395l) (as amended by section 6) to address health care
provider capacity, improve health services delivery,
effectuate community improvements, or conduct outreach
and education efforts; and
(2) identify specific diseases or indicators of health for
improvement of health outcomes in such area, including at least
1 of the following:
(A) Cardiovascular disease.
(B) Asthma.
(C) Diabetes.
(D) Behavioral health.
(E) Maternal and birth health.
(F) Obesity.
(e) Considerations.--The Secretary--
(1) shall consider geographic diversity, among other
factors, in selecting areas for designation as Health
Investment Zones; and
(2) may conduct outreach efforts to encourage a
geographically diverse pool of applicants, including for
designating Health Investment Zones in rural areas.
(f) Priority.--In selecting areas for designation as Health
Investment Zones, the Secretary shall give higher priority to
applications based on the extent to which an area demonstrates the
following:
(1) Support from, and participation of, key stakeholders in
the area proposed for designation, including residents and
local governments of such area.
(2) A plan for long-term funding and sustainability.
(3) Integration with any applicable State health
improvement process or plan.
(4) A plan for evaluation of the impact of designation of
such area as a Health Investment Zone.
(5) A plan to utilize existing State tax credits, grants,
or other incentives to reduce health disparities and improve
health outcomes in the proposed Health Investment Zone.
(6) Such other factors as the Secretary determines are
appropriate to demonstrate a commitment to reduce health
disparities and improve health outcomes in such area.
(g) Period of Designation.--The designation under this section of
an area as a Health Investment Zone shall be in effect until the date
that is 10 years after the date on which the first such area is so
designated.
SEC. 3. TAX INCENTIVES.
(a) Work Opportunity Credit for Hiring Health Investment Zone
Workers.--
(1) In general.--Section 51(d)(1) of the Internal Revenue
Code of 1986 is amended by striking ``or'' at the end of
subparagraph (I), by striking the period at the end of
subparagraph (J) and inserting ``, or'', and by adding at the
end the following new subparagraph:
``(K) a qualified Health Investment Zone worker, to
the extent that the qualified first-year wages with
respect to such worker are paid for qualified Health
Investment Zone work.''.
(2) Qualified health investment zone worker.--Section 51(d)
of such Code is amended by adding at the end the following new
paragraph:
``(16) Health investment zones.--
``(A) Qualified health investment zone worker.--The
term `qualified Health Investment Zone worker' means
any individual who is certified by the designated local
agency as having (as of the hiring date) a principal
place of employment within a Health Investment Zone.
``(B) Qualified health investment zone work.--The
term `qualified Health Investment Zone work' means
employment by a Health Investment Zone practitioner,
the primary official duties of such employment being to
promote access to healthcare in a Health Investment
Zone.
``(C) Related terms.--For purposes of this
paragraph, the terms `Health Investment Zone' and
`Health Investment Zone practitioner' have the same
meaning given such terms under section 8 of the Health
Investment Zones Act of 2026.''.
(3) Effective date.--The amendments made by this subsection
shall apply to amounts paid or incurred after the date of the
enactment of this Act to individuals who begin work for the
employer after such date.
(b) Credit for Health Investment Zone Workers.--
(1) In general.--Subpart A of part IV of subchapter A of
chapter 1 of the Internal Revenue Code of 1986, as amended by
section 70411 of Public Law 119-21, is amended by inserting
after section 25F the following new section:
``SEC. 25G. CREDIT FOR QUALIFIED HEALTH INVESTMENT ZONE WORKERS.
``(a) Allowance of Credit.--In the case of a qualified Health
Investment Zone worker, there shall be allowed as a credit against the
tax imposed by this chapter for a taxable year an amount equal to 30
percent of wages received for qualified Health Investment Zone work
during such taxable year.
``(b) Definitions.--For purposes of this section--
``(1) Qualified health investment zone worker.--The term
`qualified Health Investment Zone worker' means, with respect
to wages, an individual whose principal place of employment
while earning such wages is within a Health Investment Zone (as
such term is defined in section 8 of the Health Investment
Zones Act of 2026).
``(2) Qualified health investment zone work.--The term
`qualified Health Investment Zone work' has the same meaning
given such term in section 51(d)(16)(B).''.
(2) Clerical amendment.--The table of sections for subpart
A of part IV of subchapter A of chapter 1 of such Code, as
amended by section 70411 of Public Law 119-21, is amended by
inserting after the item relating to section 25F the following
new item:
``Sec. 25G. Credit for qualified Health Investment Zone workers.''.
(3) Effective date.--The amendments made by this subsection
shall apply to wages received after the date of the enactment
of this Act.
SEC. 4. GRANTS.
(a) Authorization.--For each area designated as a Health Investment
Zone, the Secretary may award a grant to the community-based nonprofit
organization or local governmental agency that applied for such
designation to support such applicant and its coalition partners in
reducing health disparities and improving health outcomes in such area.
(b) Use of Funds.--Programs and activities funded through a grant
under this section shall be consistent with the grantee's plan
submitted pursuant to section 2(d)(1) and may include the following:
(1) Subgrants to health care practitioners.--
(A) In general.--For the purpose of improving or
expanding the delivery of health care in the respective
Health Investment Zone, the grantee may award subgrants
to Health Investment Zone practitioners to defray costs
related to innovative strategies listed in paragraph
(2).
(B) Eligibility.--To be eligible to receive a
subgrant pursuant to subparagraph (A), a Health
Investment Zone practitioner shall--
(i) own or lease a health care facility in
the Health Investment Zone; or
(ii) provide health care in such a
facility.
(C) Amount.--The amount of a subgrant under
subparagraph (A) may not exceed the lesser of--
(i) $5,000,000; or
(ii) 50 percent of the costs of the
equipment, or capital or leasehold
improvements.
(2) Innovative strategies.--A grantee (or subgrantee) may
use a grant received under this section (or a subgrant received
under paragraph (1)) to implement innovative public health
strategies in the respective Health Investment Zone, which
strategies may include--
(A) internships and volunteer opportunities for
students who reside in the Health Investment Zone;
(B) funding resources to improve health care
provider capacity to serve non-English speakers;
(C) operation of medical, mental and behavioral
health, and dental mobile clinics;
(D) provision of transportation to and from medical
appointments for patients;
(E) funding resources to improve access to healthy
food, recreation, and high-quality housing;
(F) capital or leasehold improvements to a health
care facility in the respective Health Investment Zone;
and
(G) medical or dental equipment to be used in such
a facility.
SEC. 5. STUDENT LOAN REPAYMENT PROGRAM.
(a) In General.--The Secretary shall carry out a loan repayment
program under which the Secretary enters into agreements with eligible
Health Investment Zone practitioners to make payments on the principal
and interest of the eligible educational loans of such practitioners
for each year such practitioners agree to provide health care services
in a Health Investment Zone.
(b) Limitations.--In entering into loan repayment agreements under
this section, the Secretary may not agree to--
(1) make payments for more than 10 years with respect to a
practitioner; or
(2) pay more than $10,000 per year, or more than a total of
$100,000, with respect to a practitioner.
(c) Relationship to Other Benefits.--
(1) Counting of payments.--A payment made to, or on behalf
of, an eligible Health Investment Zone practitioner under this
section shall be considered a qualifying payment counted toward
any total number of required payments for forgiveness or
cancellation on an otherwise applicable student loan plan or
program under the Higher Education Act of 1965 or the Public
Health Service Act, such as under subsection (m) or (q) of
section 455 or section 493C of the Higher Education Act of 1965
(20 U.S.C. 1087e; 1098e).
(2) No double payments.--No borrower may, for the same
service, receive a payment for an eligible educational loan
under--
(A) this section; and
(B) another federally supported loan program that
provides a payment to, or on behalf of, that borrower.
(3) No reimbursement.--An eligible Health Investment Zone
practitioner shall not receive a payment or reimbursement under
this section for an eligible educational loan that has been
forgiven, cancelled, or repaid.
(d) Definitions.--In this section:
(1) Eligible educational loan.--The term ``eligible
educational loan'' means any federally funded or guaranteed
student loan, as determined appropriate by the Secretary, in
consultation with the Secretary of Education.
(2) Eligible health investment zone practitioner.--The term
``eligible Health Investment Zone practitioner'' means a Health
Investment Zone practitioner who--
(A) agrees to provide full-time health care
services in a Health Investment Zone for a specified
period that is not less than 1 year; and
(B) has 1 or more eligible educational loans.
SEC. 6. INCENTIVE PAYMENTS FOR MEDICARE PART B ITEMS AND SERVICES
FURNISHED IN HEALTH INVESTMENT ZONES.
Section 1833 of the Social Security Act (42 U.S.C. 1395l) is
amended by adding at the end the following new subsection:
``(ee) Incentive Payments for Items and Services Furnished in
Health Investment Zones.--
``(1) In general.--In the case of items and services
furnished under this part in an area that is designated as a
Health Investment Zone under section 2(a)(1) of the Health
Investment Zones Act of 2026, in addition to the amount of
payment that would otherwise be made for such items and
services under this part, there also shall be paid (on a
monthly or quarterly basis)--
``(A) an amount equal to 10 percent of the payment
amount for the item or service under this part;
``(B) for such an item or service furnished at a
freestanding physician office or clinic (as defined in
paragraph (2)) or a Federally qualified health center
(as defined in section 1861(aa)(3)), in addition to any
applicable additional payment amount under this
paragraph, an amount equal to 5 percent of the payment
amount for the item or service under this part; and
``(C) for an annual wellness visit (HCPCS codes
G0438-G0439), diabetes self-management training (CPT
codes 98960-98962), chronic care management (CPT codes
99487-99491), and a preventative screening such as a
mammography or colorectal cancer screening, in addition
to any applicable additional payment amount under this
paragraph, an amount equal to 10 percent of the payment
amount for such item or service under this part.
``(2) Definition of freestanding physician office or
clinic.--In this subsection, the term `freestanding physician
office or clinic' means a clinic that--
``(A) bills by place of service code 11 (office) or
22 (independent clinic) in the physician fee schedule
under section 1848; and
``(B) is not directly or indirectly owned or
controlled by a hospital system enrolled in the
Medicare Provider Enrollment, Chain, and Ownership
System (commonly referred to as `PECOS').
``(3) Coordination with other payments.--The amount of the
additional payment for an item or a service under this
subsection and subsection (m) shall be determined without
regard to any additional payment for the item or service under
subsection (m) and this subsection, respectively. The amount of
the additional payment for an item or a service under this
subsection and subsection (z) shall be determined without
regard to any additional payment for the item or service under
subsection (z) and this subsection, respectively.''.
SEC. 7. REPORTING.
(a) In General.--Not later than the day that is 10 years after the
first Health Investment Zone is designated, the Secretary shall submit
to Congress a report on the implementation of this Act (and the
amendments made by this Act) and the results thereof.
(b) Contents.--Each report under subsection (a) shall--
(1) specify the number and types of incentives provided
pursuant to this Act in each Health Investment Zone; and
(2) include evidence of the extent to which the incentives
utilized by each Health Investment Zone have--
(A) succeeded--
(i) in attracting health care practitioners
to practice in Health Investment Zones;
(ii) in reducing health disparities and
improving health outcomes in Health Investment
Zones; and
(iii) in reducing health costs and hospital
admissions and readmissions in Health
Investment Zones; and
(B) impacted access to primary care services and
utilization of emergency room services.
SEC. 8. DEFINITIONS.
In this Act:
(1) The term ``Health Investment Zone'' means an area
designated under section 2 as a Health Investment Zone.
(2) The term ``Health Investment Zone practitioner'' means
a health care practitioner who--
(A) is licensed or certified in accordance with
applicable State law to treat patients in the
applicable Health Investment Zone;
(B) provides--
(i) primary care, which may include
obstetrics, gynecological services, pediatric
services, or geriatric services;
(ii) behavioral health services, which may
include mental health or substance use disorder
services; or
(iii) dental services; and
(C) is a participating provider of services or
supplier under the Medicare program under title XVIII
of the Social Security Act (42 U.S.C. 1395 et seq.) or
a participating provider under a State plan under title
XIX of such Act (42 U.S.C. 1396 et seq.).
(3) The term ``Secretary'' means the Secretary of Health
and Human Services.
SEC. 9. AUTHORIZATION OF APPROPRIATIONS.
To carry out this Act, there is authorized to be appropriated such
sums as may be necessary for the period beginning on the date of
enactment of this Act and ending on the last day of the 10-year period
that begins on the date on which the first Health Investment Zone is
designated.
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