[Congressional Record Volume 144, Number 95 (Thursday, July 16, 1998)]
[Senate]
[Pages S8418-S8420]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                        CBO ESTIMATE ON S. 1754

 Mr. JEFFORDS. Mr. President, on June 23, 1998, I filed Report 
105-220 to accompany S. 1754, the Health Professions Education 
Partnerships Act of 1998, a bill to consolidate and reauthorize health 
professions and minority and disadvantaged health education programs, 
and for other purposes. At the time the report was filed, an incorrect 
estimate was filed by the Congressional Budget Office. Since that time, 
the CBO has corrected its estimate. I ask that a complete copy of the 
revised CBO estimate be printed in the Record.
  The estimate follows:

                                                    U.S. Congress,


                                  Congressional Budget Office,

                                    Washington, DC, June 24, 1998.
     Hon. James M. Jeffords,
     Chairman, Committee on Labor and Human Resources, U.S. 
         Senate, Washington, DC.
       Dear Mr. Chairman: The Congressional Budget Office has 
     prepared the enclosed revised cost estimate for S. 1754, 
     Health Professions Education Partnerships Act of 1998.
       This revised estimate supersedes CBO's estimate of May 28, 
     1998, and corrects an error in the assumed subsidy rate for 
     Health Education Assistance Loans.
       If you wish further details on this estimate, we will be 
     pleased to provide them. The CBO staff contact is Cyndi 
     Dudzinski, who can be reached at 226-9010.
           Sincerely,
                                                  June E. O'Neill,
                                                         Director.

[[Page S8419]]

       Enclosure.

               CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

                        (Revised June 24, 1998)

  S. 1754: Health Professions Education Partnerships Act of 1998 (As 
 Ordered Reported by the Senate Committee on Labor and Human Resources 
                           on April 1, 1998)


                                summary

       S. 1754 would reauthorize, amend, and consolidate programs 
     within the Public Health Service Act. These programs provide 
     federal funding through grants and contracts for health 
     professions students, schools, clinics, and demonstration 
     projects. They focus on increasing the diversity and supply 
     of health care providers and the care they provide to 
     shortage areas, ethnic populations, and high-risk population 
     groups. The legislation would authorize appropriations for 
     fiscal years beginning in 1998 and, in most instances, ending 
     in 2002. Assuming appropriation of the authorized amounts, 
     CBO estimates that enacting S. 1754 would result in 
     additional discretionary outlays of $334 million in 1999 and 
     a total of $3.5 billion over the 1998-2003 period.
       Subtitle C would reauthorize the Health Education 
     Assistance Loan (HEAL) program through 2002. This provision 
     would increase direct spending by $1 million in fiscal year 
     1998 and by $21 million during the 1998-2003 period. Because 
     the bill would affect direct spending, pay-as-you-go 
     procedures would apply.
       S. 1754 would waive any state statutes of limitations that 
     govern the repayment of loans by nursing and other medical 
     students. This preemption of state statutory authority would 
     represent a mandate as defined by the Unfunded Mandates 
     Reform Act (UMRA). However, CBO estimates that the mandate 
     would have no impact on the budgets of state, local, or 
     tribal governments. The legislation does not include any 
     private-sector mandates as defined in UMRA.
       This revised estimate supersedes CBO's estimate of May 28, 
     1998, and corrects an error in the assumed subsidy rate for 
     Health Education Assistance Loans.


                ESTIMATED COST TO THE FEDERAL GOVERNMENT

       The estimated budgetary impact of S. 1754 is shown in the 
     following table.

----------------------------------------------------------------------------------------------------------------
                                                            By fiscal year, in millions of dollars--            
                                               -----------------------------------------------------------------
                                                   1998       1999       2000       2001       2002       2003  
----------------------------------------------------------------------------------------------------------------
                                        SPENDING SUBJECT TO APPROPRIATION                                       
                                                                                                                
Spending Under Current Law:                                                                                     
    Budget Authority\1\.......................        828          0          0          0          0          0
    Estimated Outlays.........................        796        522        151         39      (\2\)          0
                                                                                                                
                                         WITH ADJUSTMENTS FOR INFLATION                                         
                                                                                                                
Proposed Changes:                                                                                               
    Authorization Level.......................         24        875        898        922        944         46
    Estimated Outlays.........................          0        334        724        862        924        618
Spending Under S. 1754:                                                                                         
    Authorization Level.......................        852        875        898        922        944         46
    Estimated Outlays.........................        796        856        875        901        924        618
                                                                                                                
                                        WITHOUT ADJUSTMENTS FOR INFLATION                                       
                                                                                                                
Proposed Changes:                                                                                               
    Authorization Level.......................         24        852        852        852        851         40
    Estimated Outlays.........................          0        326        698        813        851        561
Spending Under S. 1754:                                                                                         
    Authorization Level.......................        852        852        852        852        851         40
    Estimated Outlays.........................        796        848        849        852        852        561
                                                                                                                
                                                 DIRECT SPENDING                                                
                                                                                                                
Spending Under Current Law:                                                                                     
    Estimated Budget Authority................          1          0          0          0          0          0
    Estimated Outlays.........................          1          0          0          0          0          0
Proposed Changes:                                                                                               
    Estimated Budget Authority................          1          3          4          5          5          3
    Estimated Outlays.........................          1          3          4          5          5          3
Spending Under S. 1754:                                                                                         
    Estimated Budget Authority................          2          3          4          5          5          3
    Estimated Outlays.........................          2          3          4          5          5          3
----------------------------------------------------------------------------------------------------------------
\1\ The 1998 level is the amount appropriated for the year.                                                     
\2\ Less than $500,000.                                                                                         

       The costs of this legislation fall within budget function 
     550 (health).


                           basis of estimate

       S. 1754 would reauthorize and consolidate several programs 
     within the Public Health Service Act. The initial and final 
     year of the period of authorization would vary across 
     programs. For years in which the bill specifies the amount 
     authorized, CBO assumed that appropriations for each program 
     would be made in the full amount of the authorization. For 
     years in which the bill authorizes appropriation of such sums 
     as may be necessary, CBO assumed that the specific amount 
     appropriated in 1998 or authorized in a subsequent year would 
     be increased by inflation and that the amount authorized 
     would be appropriated.
       With the exception of 1998, CBO assumed that all amounts 
     authorized by S. 1754 would be appropriated by the start of 
     the fiscal year and that outlays would follow the historical 
     spending patterns of the respective agencies. The estimate 
     assumes that amounts authorized for 1998 would be 
     appropriated late in the year and that outlays would begin in 
     1999.

Title I--Health Professions Education and Financial Assistance Programs

       Subtitle A--Health Professionals Education Programs. S. 
     1754 would reauthorize, amend, and consolidate the Health 
     Professions Education Programs administered by the Health 
     Resources and Services Administration (HRSA) and would 
     include funding for behavioral or mental health providers and 
     services under the Programs. It authorizes $237 million in 
     1998 and such sums as necessary for 1999-2002. Assuming 
     appropriation of the authorized amounts CBO estimates 
     Subtitle A would result in additional discretionary outlays 
     of $107 million in 1999 and $985 million over the 1998-2003 
     period.
       Subtitle B--Nursing Workforce Development. S. 1754 would 
     reauthorize, amend, and consolidate the Nursing Workforce 
     Development programs administered by HRSA. It authorizes $65 
     million in 1998 and such sums as necessary over the 1999-2002 
     period. CBO estimates that this subtitle would result in 
     additional discretionary spending of $28 million in 1999 and 
     $269 million over the 1998-2003 period.

                    Subtitle C--Financial Assistance

       Chapter 1--School-Based Revolving Loan Funds. S. 1745 would 
     reauthorize and amend HRSA's school-based revolving loan 
     funds. It authorizes $8 million in annual appropriations for 
     1998 through 2002. CBO estimates this provision would result 
     in additional discretionary outlays of $11 million in 1999 
     and $39 million during the 1998-2003 period.
       Chapter 2--Insured Health Education Assistance Loans to 
     Graduate Students. S. 1754 would reauthorize the HEAL program 
     through 2002. Currently, the program's authorization expires 
     at the end of 1998, and it is only authorized to make loans 
     to students who received their first HEAL loan before 1995. 
     Section 143 of the bill would reauthorize HEAL for five 
     years, starting in 1998. The authorized loan limits would be 
     $350 million in 1998, $375 million in 1999, and $425 million 
     a year for 2000 through 2002. Loans to new borrowers would 
     not be issued after 2000, and no loans would be insured under 
     the program after 2005. CBO assumes that loan disbursements 
     would equal the amount authorized. CBO estimates that the 
     average subsidy rate for these disbursements would be about 1 
     percent. Therefore, this provision would result in $1 million 
     in direct spending in 1998 and a total of $21 million during 
     the 1998-2003 period.
       For lenders who fail to meet certain performance standards, 
     the bill would also reduce federal payments from 100 percent 
     to 98 percent of losses incurred through loan defaults. In 
     addition, the Secretary would have the authority to collect 
     any unpaid balances from the estate of a deceased borrower. 
     Finally, the proposal would grant a deferment to borrowers 
     who furnish health care services to Indians through an Indian 
     Health Service program.

                  Title II--Office of Minority Health

       S. 1754 would reauthorize the Office of Minority Health 
     within the Office of the Assistance Secretary. It would also 
     require the Secretary to establish the Advisory Committee on 
     Minority Health. It would authorize appropriations of $30 
     million for 1998 and such sums as necessary for 1999-2002.
       It would also reauthorize the National Center for Health 
     Statistics (NCHS) within the Centers for Disease Control and 
     Prevention (CDC), providing such sums as necessary for 1999 
     through 2003. In addition, where current law provides a 
     general authorization for NCHS to make grants to entities for 
     data collection and analysis on racial and ethnic

[[Page S8420]]

     populations, S. 1754 would authorize an additional grant 
     program. The funding under this grant program would be used 
     for collecting data specifically on Hispanics and major 
     Hispanic subpopulation groups and on American Indians, and 
     for developing special area population studies on major Asian 
     American and Pacific Islander populations. For this 
     additional grant program, it would authorize $1 million in 
     appropriations for fiscal year 1998 and such sums as 
     necessary for 1999-2002.
       CBO estimates the provisions under Title II would result in 
     additional discretionary outlays of $25 million in 1999 and 
     $242 million during the 1998-2003 period.

 Title III--Selected Initiatives and Title IV--Miscellaneous Provisions

       S. 1754 would amend and reauthorize several other grant 
     programs within HRSA, CDC, the National Institutes of Health, 
     and the Administration on Aging. Except for a few small 
     programs where the bill specifies the authorization for one 
     or more years, Title III and IV would provide such sums as 
     necessary for the entire period of the authorization for 
     these programs. In addition, it would provide a permanent 
     authorization of $0.5 million a year for the Foundation for 
     the National Institutes of Health.
       Assuming appropriation of the authorized amounts, CBO 
     estimates that Titles III and IV would result in additional 
     discretionary spending of $163 million in 1999 and $1.9 
     billion over the 1998-2003 period.


                      pay-as-you-go considerations

       The Balanced Budget and Emergency Deficit Control Act of 
     1985 sets up pay-as-you-go procedures for legislation 
     affecting direct spending or receipts. Because section 143 of 
     the bill would affect direct spending, pay-as-you-go 
     procedures would apply. The impact of this provision on 
     federal outlays is shown in the following table. For the 
     purposes of enforcing pay-as-you-go procedures, only the 
     effects in the current year, the budget year, and the 
     succeeding four years are counted.

                                                            SUMMARY OF PAY-AS-YOU-GO EFFECTS                                                            
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                              By Fiscal Year, in Millions of Dollars--                                  
                                           -------------------------------------------------------------------------------------------------------------
                                               1998       1999       2000       2001       2002       2003       2004       2005       2006       2007  
--------------------------------------------------------------------------------------------------------------------------------------------------------
Change in outlays.........................          1          3          4          5          5          3          2          1          0         0[
Change in receipts........................                                                                                                              
(9)Not applicable                                                                                                                                       
--------------------------------------------------------------------------------------------------------------------------------------------------------

        estimated impact on state, local, and tribal governments

       S. 1754 would waive any state statutes of limitations that 
     govern the repayment of loans to nursing and other medical 
     students. This preemption of state statutory authority would 
     be a mandate as defined by the Unfunded Mandates Reform Act. 
     However, CBO estimates that the mandate would have no impact 
     on the budgets of state, local, or tribal governments.
       The bill would also authorize appropriations for a number 
     of grant programs. State and local governments, as well as 
     other public and private entities, would be eligible to 
     receive funding from these grant programs as long as they 
     meet certain grant conditions. Participation in these 
     programs would be voluntary, and the overall budgetary 
     effects to the participating governments would be favorable.


                 estimated impact on the private sector

       S. 1754 does not include any private sector mandates as 
     defined in the Unfunded Mandates Reform Act.
       Estimate prepared by: Federal Costs: Cyndi Dudzinski (226-
     9010); Impact on State, Local, and Tribal Governments: Leo 
     Lex (225-3220); and Impact on the Private Sector: Julia 
     Matson (226-2674).
       Estimate approved by: Paul N. Van de Water, Assistant 
     Director for Budget Analysis.

                          ____________________