[Senate Report 110-274]
[From the U.S. Government Publishing Office]



                                                       Calendar No. 548
110th Congress                                                   Report
                                 SENATE
 2d Session                                                     110-274

======================================================================



 
                   HEALTH CARE SAFETY NET ACT OF 2007


                                _______
                                

                 March 12, 2008.--Ordered to be printed

                                _______
                                

   Mr. Kennedy, from the Committee on Health, Education, Labor, and 
                   Pensions, submitted the following

                              R E P O R T

                         [To accompany S. 901]

    The Committee on Health, Education, Labor, and Pensions, to 
which was referred the bill (S. 901) to amend the Public Health 
Service Act to provide additional authorizations of 
appropriations for the health centers program under section 330 
of such Act, having considered the same, reports favorably 
thereon with an amendment in the nature of a substitute and an 
amendment to the title and recommends that the bill (as 
amended) do pass.

                                CONTENTS

                                                                   Page
  I. Purpose and need for legislation.................................1
 II. Summary.........................................................14
III. History of legislation and votes in committee...................14
 IV. Explanation of bill and committee views.........................15
  V. Cost estimate...................................................21
 VI. Regulatory impact statement.....................................23
VII. Application of law to the legislative branch....................23
VIII.Section-by-section analysis.....................................23

 IX. Changes in existing law.........................................25

                  I. Purpose and Need for Legislation

    The Health Care Safety Net Act of 2007 reauthorizes and 
strengthens three programs which together provide a safety net 
that helps millions of Americans each year access needed health 
care services. In doing so, the committee is acting to 
maintain, improve, and increase its support for these programs, 
which enable safety net providers located in rural and urban 
areas throughout this country to offer health care services to 
millions of underserved and uninsured people. The programs 
included in this act are:
     The Health Centers program, established under 
Title III, Section 330 of the Public Health Service Act; 
supports the provision of health care and related services to 
the medically underserved--meaning those individuals living in 
rural or urban communities that are federally-designated as 
medically underserved, or whose populations are members of a 
federally-designated medically underserved population.
     The National Health Service Corps, authorized 
under Title III, Sections 331 through 338L of the Public Health 
Service Act; assists in the delivery of health services in 
health professional shortage areas by providing access to 
scholarships and loan repayments to eligible clinicians.
     Rural Health Programs, located in Title III, 
Sections 330A, 330I, 330J, and 330K of the Public Health 
Service Act; assist with the provision of coordinated care in 
rural areas. These programs include the Rural Health Care 
Services Outreach, Rural Health Network Development, Small 
Health Care Provider Quality Improvement, Telehealth Network, 
Telehealth Resource Centers, Rural Emergency Medical Service 
Training and Equipment Assistance, and Mental Health Service 
Delivered Via Telehealth.

                       THE HEALTH CENTERS PROGRAM

Introduction

    The Committee has a long history of supporting the work of 
safety net providers in urban and rural areas who dedicate 
their efforts to providing care for those individuals who would 
otherwise not have access to a regular source of health care. 
At a time when 47 million Americans are without health 
insurance and over 56 million lack adequate access to a primary 
care physician due to an actual physician shortage in their 
communities, existing safety net providers continue to grapple 
with increasing demands for care from the uninsured and 
underinsured populations in this country. Thousands of 
communities across the country today continue to experience 
shortages of accessible, cost-effective, preventive and primary 
health care services especially for individuals who are unable 
to pay for such care.

History of Health Centers Program

    In response to the large number of individuals living in 
medically underserved areas, as well as the growing number of 
special populations lacking access to preventive and primary 
health care services, in 1965, Congress created the Health 
Centers program, formally authorizing it in 1975. For more than 
40 years, the Health Centers program has effectively and 
efficiently assured access to cost-effective, high quality, 
preventive and primary care services, thereby improving the 
health status of the Nation's underserved and vulnerable 
populations. This program was designed to empower communities 
to address local health access challenges and to improve the 
health status of their underserved and vulnerable populations. 
Health centers do this by building community-based primary care 
capacity and by offering case management, home visitation, 
outreach, and other enabling services to increase utilization 
by vulnerable populations and improve the effectiveness of the 
preventive and primary care they offer. Health centers serve as 
a prototype for effective public-private partnerships, 
demonstrating their ability to meet pressing local health needs 
while being held accountable for meeting national performance 
standards. The care provided at health centers contributes to 
success of the program in reducing avoidable hospitalizations, 
lowering emergency room use, and lessening the need for 
specialty care, thus saving billions for taxpayers and 
society.\1\
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    \1\National Association of Community Health Centers and The Robert 
Graham Center. Access Denied: A Look at America's Medically 
Disenfranchised. March 2007. www.nachc.com/research-data.cfm. NACHC and 
Association of Community Affiliated Plans, The Impact of Health Centers 
and Community-Affiliated Health Plans on Emergency Department Use, 
April 2007. www.nachc.com/research-data.cfm. National Association of 
Community Health Centers, The Robert Graham Center, and Capital Link. 
Access Granted: The Primary Care Payoff. August 2007. www.nachc.com/
research-reports.cfm.
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Core requirements of the Health Centers Program

    The Health Centers program's core elements found in Section 
330 of the Public Health Service Act, as established by 
Congress, and last reauthorized in 2002 as part of the Health 
Care Safety Net Amendments Act, Public Law (P.L.) 107-251 
stipulate that each Federally-supported health center must:
          1. Be located in, and serve, a community that is 
        federally-designated as ``medically underserved,'' thus 
        ensuring the proper targeting of Federal resources to 
        areas of greatest need;
          2. Make its services available to all residents of 
        the community, without regard for ability (or 
        inability) to pay for such services, and make those 
        services affordable by discounting the health center's 
        charges in accordance with family income for otherwise 
        uncompensated care provided to low-income families;
          3. Provide comprehensive primary health care 
        services, including preventive care (such as regular 
        check-ups and pap smears), care for acute and chronic 
        illnesses and injuries, services to improve both the 
        accessibility of care (such as transportation and 
        translation services) and the effectiveness of care 
        (such as health/nutrition education), and patient case 
        management;
          4. Be governed by a board of directors, a majority of 
        whose members are active, registered patients of the 
        health center, thus ensuring that the center is 
        responsive to the health care needs of the community it 
        serves.
    Health centers must also meet strict operational, clinical 
and financial standards, as well as reporting and performance 
requirements.

Types of health centers

    During the 1996 reauthorization of the Health Centers 
program (Health Centers Consolidation Act of 1996, P.L. 104-
299), the committee consolidated four separately targeted 
health center authorities under a single authority, while 
maintaining distinct resources to serve vulnerable 
subpopulations of migrant and seasonal farm workers and their 
families, homeless individuals, and residents of public 
housing. The program currently serves over 17 million medically 
underserved people in more than 6,300 service delivery sites in 
every State and territory.\2\
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    \2\NACHC, 2008 based on Bureau of Primary Health Care, HRSA, DHHS, 
2006 Uniform Data System (UDS). It includes patients of federally-
funded health centers, non-federally funded health centers (health 
center ``look-alikes''), and expected patient growth for 2007-2008.
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    1. Community Health Centers--Community Health Centers were 
first funded by Congress in the mid-1960s as neighborhood 
health centers. By the early 1970s, approximately 100 
neighborhood health centers had been established under the 
Economic Opportunity Act. These centers were designed to 
provide accessible, personal health services to low-income 
families. Community and consumer participation in the 
organization and ongoing governance of the centers remain 
central elements of the program. Each center is required to 
have a governing board, a majority of whose members are 
comprised of consumers of the center's services.
    With the phase-out of the Office of Economic Opportunity in 
the early 1970s, the centers supported under this authority 
were transferred to the Public Health Service Act. While 
services were directed to the poor and near poor, the centers 
also provided access to a broader population who could pay all 
or part of the cost of their health care. The Community Health 
Center program, as authorized under Section 330 of the Public 
Health Service Act, was established in 1975 by Public Law 
(P.L.) 94-63.
    2. Migrant Health Center--The Migrant Health Center program 
was established by Congress in 1962 under the Migrant Health 
Act, P.L. 87-692, and was reauthorized in 1975 by P.L. 94-63. 
Migrant Health Centers were created to provide a broad array of 
medical and support services to farmworkers and their families. 
In addition to primary and preventive health care, many of 
these centers provide transportation, translation, outreach, 
dental, pharmacy, and environmental health services. In 2002, 
P.L. 107-251 clarified the eligibility of certain farmworkers 
to receive health center services at section 330-funded health 
centers. The 2002 reauthorization also called for the 
Department of Health and Human Services to conduct a study of 
the barriers to enrollment in and the possible solutions to the 
challenges faced by farmworkers under Medicaid and the State 
Children's Health Insurance Program. In 2006, a network of 140 
migrant health centers provided services to over 800,000 
migrant and seasonal farmworkers and their families in more 
than 1,052 delivery sites.\3\
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    \3\NACHC, 2008 based on Bureau of Primary Health Care, HRSA, DHHS, 
2006 Uniform Data System (UDS).
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    3. Health Care for the Homeless--The Health Care for the 
Homeless program was established by Congress to provide 
comprehensive, high quality, case-managed, preventive and 
primary health care services, including substance abuse 
services and mental health referrals, for homeless individuals 
at locations accessible to them. With the enactment of P.L. 
107-251, Congress clarified the eligibility of homeless youth 
and formerly homeless persons to receive section 330-funded 
services during the first 12 months following their transition 
to permanent housing, in order to ensure that the program 
remained appropriately targeted to the most vulnerable 
populations.
    The Health Care for the Homeless program has played (and 
continues to play) a pivotal role in stimulating local 
collaboration and coordination of health and social services. A 
total of 184 organizations, including community health centers, 
public health departments, and other community-based health 
service providers, currently provide care to approximately 
828,000 sick and underserved homeless people annually.
    4. Health Services for Residents of Public Housing--The 
Health Services for Residents of Public Housing program was 
established by Congress under the Disadvantaged Minority Health 
Improvement Act of 1990. This legislation focused on the 
disparity in health status of minority populations and placed 
emphasis on the development of comprehensive delivery models 
that address the special health problems which affect families 
residing in public housing complexes--especially targeting 
pregnant women and children. Services are provided at public 
housing complexes or at sites either adjacent to or immediately 
accessible to these complexes. In 2006, 37 organizations 
received funding under the program, and provided comprehensive, 
high quality, case-managed, family-based preventive and primary 
health care services to approximately 70,000 public housing 
residents.

Expansion of Health Centers Program

    In 2000, Congress launched a historic plan--the Resolution 
to Expand Access to Community Health Centers (REACH) 
Initiative--which pledged to double access to community health 
centers in medically underserved areas over 5 years. With this 
initiative came an unprecedented $150 million increase in 
Federal funding for health centers, and the Health Centers 
program entered into a period of unparalleled growth. In 2001, 
the Bush administration joined this historic initiative, 
pledging to continue to expand the capacity of health centers 
to provide care.\4\
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    \4\Administration FY 2001 Budget Overview.
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    Wide bipartisan support in Congress has supported these 
goals and has ensured the necessary funding increases to expand 
the program, while supporting the infrastructure of existing 
centers. At the start of the President's Expansion Initiative 
in 2001, 10 million patients were served by the Health Centers 
Program. By 2006, new and expanded access points created access 
to care for more than 16 million people who were served at 
6,000 service delivery sites in every State and territory. 
Additionally, support from the President and Congress have 
allowed several existing health centers to expand the services 
they offer beyond primary medical and preventive care. Service 
expansions have assisted health centers in providing mental 
health, dental, pharmaceutical and optometric services.

Success of the Health Centers Program

    Since the reauthorization in 2002, the Health Centers 
program has continued to develop and implement a significant 
number of highly successful, innovative, preventive, and 
primary health care delivery approaches in our Nation's most 
needy inner cities and rural areas.
    Health centers are effective in increasing access to health 
care services in needy communities. In 2006, more than 16 
million patients were served at health centers--representing a 
32.7 percent increase over the 11.3 million persons served in 
2002. Of those 16 million patients, over 6 million patients or 
40 percent of all health center patients were uninsured--a 34 
percent increase over the 4.4 million uninsured individuals 
served by centers in 2002. Further, in 2006, 23.3 percent of 
those uninsured individuals were children. Three million health 
center patients are enrollees in managed care systems. Health 
centers serve 1 in 7 uninsured persons, 1 in 9 Medicaid 
beneficiaries, and 1 in 4 low-income individuals in the United 
States today.\5\
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    \5\NACHC, 2008 based on Bureau of Primary Health Care, HRSA, DHHS, 
2006 Uniform Data System (UDS).
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    Furthermore, health centers are effective at improving 
health outcomes, increasing access to preventive services, 
improving the management of chronic diseases, mitigating health 
disparities, and reducing avoidable hospitalizations.\6\ The 
rates of infants born at low birth weights are lower at health 
centers than nationally, even though health center patients are 
more at risk. Women of low socio-economic status seeking care 
at health centers experience lower rates of low birth weight 
compared to all low-social economic status mothers (7.5 percent 
vs. 8.2 percent).\7\ This trend holds for each racial/ethnic 
group, which is particularly noteworthy for African-American 
women who are especially at higher risk for adverse pregnancy 
outcomes. Given that two-thirds of health center patients 
belong to a minority group with an increased risk for low birth 
weight infants, this particular statistic demonstrates the 
competent care that health centers provide.
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    \6\Starfield B and Shi L. ``The Medical Home, Access to Care, and 
Insurance: A Review of Evidence.'' May 2004 Pediatrics 113(5):1493-8. 
Hadley J and Cunningham P. ``Availability of Safety Net Providers and 
Access to Care of Uninsured Persons.'' October 2004 Health Services 
Research 39(5):1527-1546. O'Malley AS, et al. ``Health Center Trends, 
1994-2001: What Do They Portend for the Federal Growth Initiative?'' 
March/April 2005 Health Affairs 24(2):465-472. Shi L. Regan J, Politzer 
RM, Luo J. ``Community Health Centers and Racial/Ethnic Disparities in 
Healthy Life.'' 2001 International Journal of Health Services 
31(3):567-582. Forrest CB and Whelan EM ``Primary care safety-net 
delivery sites in the United States: A comparison of community health 
centers, hospital outpatient departments, and physicians' offices.'' 
2000 JAMA 284(16):2077-2083. O'Malley et al, 2005.
    \7\Shi, L. Steven, G.D., Wulu, J.T., Politzer, R. M., & Xu, J. 
America's health centers: Reducing Racial and Ethnic Disparities in 
Perinatal Care and Birth Outcomes. 2004. Health Services Research, 39 
(6, Part 1), 1881-1901.
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    According to a 2002 Health Resources and Services 
Administration (HRSA) Community Health Center User survey, 
women who receive their care at health centers are more likely 
to receive a pap test than if they were to receive care 
elsewhere. This increased access to necessary preventive health 
services also is evident for women who are Hispanic and 
African-American. Furthermore, health centers have been shown 
to effectively mitigate health disparities. According to a 
report by the George Washington University, as health centers 
serve more of a State's low-income population, key State level 
disparities in communities of color decline.
    Health centers provide care to millions of Americans 
suffering from chronic diseases. In 2006, Health Centers 
treated more than 927,000 patients with diabetes, 237,500 
patients with heart disease, almost 1,461,000 patients with 
high blood pressure, and nearly 461,000 patients with 
asthma.\8\ In fact, fully one quarter of all health center 
patient visits are related to a chronic illness.
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    \8\NACHC, 2008 based on Bureau of Primary Health Care, HRSA, DHHS, 
2006 Uniform Data System (UDS).
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    Studies comparing health center patients and non-health 
center patients demonstrate that health centers provide 
services at a lower cost per ambulatory visit, while lowering 
the rate of hospital inpatient days, and lower total costs of 
care (including decreased inpatient care costs).\9\ Recently, 
the Health Centers program was recognized by the Office of 
Management and Budget as one of the most effective and 
efficiently run programs in the Department of Health and Human 
Services.
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    \9\McRae T. and Stampfly R. ``An Evaluation of the Cost 
Effectiveness of Federally Qualified Health Centers (FQHCs) Operating 
in Michigan.'' October 2006 Institute for Health Care Studies at 
Michigan State University. www.mpca.net. Falik M, Needleman J, Herbert 
R, et al. ``Comparative Effectiveness of Health Centers as Regular 
Source of Care.'' January-March 2006 Journal of Ambulatory Care 
Management 29(1):24-35.
    Garg A, Probst JC, Sease T, Samuels ME. ``Potentially Preventable 
Care: Ambulatory Care-Sensitive Pediatric Hospitalizations in South 
Carolina in 1998.'' September 2003 Southern Medical Journal 96(9):850-
8. Epstein AJ. ``The Role of Public Clinics in Preventable 
Hospitalizations among Vulnerable Populations.'' 2001 Health Services 
Research 32(2):405-420.
    Falik M, et al. ``Ambulatory Care Sensitive Hospitalizations and 
Emergency Visits: Experiences of Medicaid Patients Using Federally 
Qualified Health Centers.'' 2001 Medical Care 39(6):551-56. Stuart ME, 
et al. Improving Medicaid Pediatric Care. Spring 1995 Journal of Public 
Health Management Practice 1(2):31-38.
    Starfield B, et al. Costs vs. Quality in Different Types of Primary 
Care Settings, 28 December 1994 Journal of the American Medical 
Association 272(24):1903-1908.
    Duggar BC, et al. Utilization and Costs to Medicaid of AFDC 
Recipients in New York Served and Not Served by Community Health 
Centers. Center for Health Policy Studies, 1994.
    Duggar BC, et al. Health Services Utilization and Costs to Medicaid 
of AFDC Recipients in California Served and Not Served by Community 
Health Centers. Center for Health Policy Studies, 1994.
    Braddock D, et al. Using Medicaid Fee-For-Service Data to Develop 
Health Center Policy. Washington Association of Community Health 
Centers and Group Health Cooperative of Puget Sound, 1994.
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    As testament to health centers' ongoing commitment to the 
delivery of high-quality health services, nearly 85 percent of 
health centers have participated in one or more of HRSA's 
Health Disparities Collaboratives, initiatives which focus on 
improving health outcomes for chronic conditions among 
medically-vulnerable populations, particularly minorities. The 
Collaboratives are designed to enhance the skills of clinical 
staff, strengthen the process of care through the development 
of extensive patient registries that improve clinicians' 
ability to monitor and manage the health of individual 
patients, and effectively educate patients on self-management 
of their conditions. Health center patients with chronic 
disease are enrolled in electronic registries for diabetes, 
cardiovascular disease, asthma, depression, prevention, cancer, 
and HIV. Eventually, every health center may be participating 
in at least one Collaborative.\10\
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    \10\Chin MH, et al. ``Improving Diabetes Care in Midwest Community 
Health Centers With the Health Disparities Collaborative.'' January 
2004 Diabetes Care 27(1):2-8.
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    A study of 19 Midwestern health centers participating in 
the Diabetes Collaboratives demonstrated improved measures of 
diabetes-related health outcomes and quality (e.g., HbA1c 
measurement, eye examination referral, foot examination, and 
lipid assessment). The authors concluded that in just 1 year, 
the model employed by the Collaboratives improved diabetes care 
at the health centers.\11\ As a result of the success of the 
Collaboratives, the Institute of Medicine (IOM) commended 
health centers for providing chronic care management that is 
``at least as good as, and in many cases superior to, the 
overall health system in terms of better quality and lower 
costs,'' and recommended health centers as models for reforming 
the delivery of primary health care.\12\ The General 
Accountability Office (GAO) has recently recognized the 
Collaboratives as a promising Federal program targeting health 
disparities that should be expanded.
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    \11\Chin MH, et al. ``Improving Diabetes Care in Midwest Community 
Health Centers With the Health Disparities Collaborative.'' January 
2004 Diabetes Care 27(1):2-8.
    \12\Institute of Medicine (IOM). Coverage Matters: Insurance and 
Health Care. National Academy of Sciences Press, 2001.
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    The committee recognizes that the Health Centers program 
has been successful because of the ability of the centers to 
offer integrated, high quality, prevention-oriented, case-
managed, and family-focused primary and preventive care 
services that result in appropriate and cost-effective use of 
ambulatory, specialty, and inpatient services by other 
providers. Health centers offer primary care for people of all 
life cycles, and a range of health and other social services is 
available on-site or through referrals.
    This broad range of services includes health promotion, 
disease prevention, screening, educational, outreach, and case 
management services--services that are often missing from the 
traditional delivery of medical care, but which are 
particularly needed by high-risk populations with multiple 
health problems and facing significant barriers to access to 
care. Congress broadened this range of health center services 
in P.L. 107-251 by increasing the types of additional health 
services for which grant funding may be provided with the 
inclusion of behavioral and mental health services, public 
health services, and recuperative care services as optional 
services that health centers can choose to provide. 
Additionally, the 2002 reauthorization revised the definition 
of ``environmental health services'' to permit health centers 
to offer the detection and alleviation of chemical and 
pesticide exposures, the promotion of indoor and outdoor air 
quality, and the detection and remediation of lead exposures.
    More than 11,887 primary care physicians, nurse 
practitioners, physician assistants, and certified nurse 
midwives create the core clinical staff of health centers 
nationally. Further, health centers are home to 2,626 dentists 
and hygienists, as well as 1,559 psychiatrists and other mental 
health providers. Health centers also have been assisted 
greatly in attracting and retaining quality providers through 
the National Health Service Corps. Health centers have also 
been actively involved with academic medical centers in 
providing community-based training of physicians, nurses, and 
other health professionals.
    In addition, the Health Center program has enabled 
underserved communities to design and develop their own local 
solutions to their problems of medical underservice. By 
supporting the development and operation of health centers at 
the community level, the health centers program has assured 
that centers are community-responsive and accessible. Community 
members and patients play an active role in centers' 
decisionmaking and planning. By working with local communities 
and State organizations to plan, develop, and determine 
priorities for the allocation of resources, the Health Center 
program has successfully funded new and expanded programs and 
services in those communities that are most in need. Community 
Health Centers attract private-pay and privately insured 
individuals and families, in addition to individuals who are 
uninsured or covered by Medicaid.
    Several studies over the years have reported favorably on 
the quality and cost-effectiveness of the care offered by 
health centers. These studies cite evidence of health centers' 
clinical quality and patient satisfaction measures which 
compared favorably to national standards.\13\ Studies 
demonstrate that patients in underserved areas served by health 
centers had 5.8 fewer hospitalizations per 1,000 people over 3 
years than those in areas not served by health centers. 
According to the National Association of Community Health 
Centers, medical expenses for health center patients are 41 
percent lower compared to patients seen elsewhere. As a result, 
they save the health care system between $9.9 and $17.6 billion 
a year.\14\
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    \13\Shin P, Markus A, and Rosenbaum S. Measuring Health Centers 
against Standard Indicators of High Quality Performance: Early Results 
from a Multi-Site Demonstration Project. Interim Report. Prepared for 
the United Health Foundation, August 2006. www.gwumc.edu/sphhs/
healthpolicy/chsrp/downloads/
United_Health_Foundation_report_082106.pdf.
    \14\NACHC, 2008 ``Access Granted: The Primary Care Payoff''.
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Continued need for health centers

    While the Health Centers Program has made historic gains in 
providing increased access to and availability of health care 
services in medically-underserved communities and populations, 
major challenges still persist. Lack of access to affordable 
and readily available primary and preventive care remains a 
pervasive problem throughout the United States. Millions of 
Americans experience financial barriers to getting care. Today, 
47 million Americans are uninsured, and that number continues 
to rise. At the same time that Americans are becoming uninsured 
in larger numbers, the amount of charity care that physicians 
provide has been decreasing. According to the Center for 
Studying Health Systems Change, the percentage of physicians 
providing any free or reduced cost care decreased from 76.3 
percent in 1996 to 68.2 percent in 2004. Additionally, other 
Americans experience barriers to care due to geography or 
system capacity. Currently, over 62 million people live in 
places designated as Health Professions Shortage Areas,\15\ and 
56 million Americans are considered ``medically 
disenfranchised'' because they live in areas with insufficient 
numbers of primary care physicians.\16\ Other Americans face 
transportation, cultural or language barriers to care, and 
racial, and ethnic, and geographic disparities in access to and 
quality of care continue.
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    \15\HRSA, data as of September 30, 2007.
    \16\National Association of Community Health Centers and The Robert 
Graham Center. Access Denied: A Look at America's Medically 
Disenfranchised. March 2007. www.nachc.com/research-data.cfm.
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    Despite the success of the President's expansion program, 
only 6 million uninsured people are reached by health centers, 
accounting for only 13 percent of the Nation's uninsured. Fewer 
than half of all approvable applications for new or expanded 
health center sites received funding from 2002-2006, 
demonstrating a demand for continued expansion. Many 
underserved communities continue to lack adequate resources to 
submit a competitive application, and in some cases to even 
coordinate and complete the current application. For these 
reasons, the committee authorized significant funding increases 
for this important program.

Health Centers Programs in a changing health care environment

    Health centers have done an excellent job of adapting to 
the changing health care environment. In 1996, the committee 
permitted the use of grant funds to support the establishment 
of managed care networks and plans. Health centers across the 
country have taken steps to form networks with other local 
providers and develop the financial, legal, and business acumen 
necessary to function effectively in managed care. Almost 
three-fourths of all health centers are participating in 
managed care as subcontracting providers to managed care 
plans--serving 3 million managed care enrollees.
    As the market continues to change, health centers are 
joining with each other and with other local providers to form 
integrated service delivery networks to coordinate and improve 
their purchasing power and/or to better organize the continuum 
of care, especially for uninsured populations. Through 
networks, health centers are able to leverage their talents and 
resources to improve health outcomes, cut administrative costs, 
reduce health disparities, and employ health information 
technology and electronic medical records. These networks 
include practice management networks designed to improve 
quality through shared expertise (such as centralized 
pharmaceutical or laboratory services, clinical outcomes 
management, or joint management/administrative services); to 
lower costs through shared services (such as unified financial 
or management information systems, or joint purchasing of 
services or supplies); to improve access and availability of 
health care services provided by the health centers 
participating in the network; and/or to improve the health 
status of communities by establishing community-based programs 
such as vaccine and wellness initiatives.
    Today, nearly 200 health centers are involved in 
approximately 20 local and regional operational networks across 
a majority of States, each designed to lower costs and improve 
care. In the 2002 Health Care Safety Net Amendments, Congress 
authorized the use of up to 2 percent of Section 330 
appropriations for the funding of health center networks.
    Since the last reauthorization of the Health Centers 
program, Health Information Technology (HIT) has emerged as a 
valuable resource for all health care providers. In order to 
better coordinate care and improve patient outcomes and 
quality, health care providers and medical institutions 
throughout the health system have adopted HIT and Electronic 
Medical Records (EMR). Use of HIT and EMR reduces medical 
errors, allows for greater coordination of care, improves the 
quality of care delivered, and saves money at the individual 
and systemic level. While a majority of health centers (60 
percent) plan on implementing an Electronic Health Records 
(EHR) system in the near future, currently 13 percent of health 
centers have a fully operational EHR system. Lack of capital 
resources is overwhelmingly named as the biggest obstacle to 
adoption. By integrating health information technology into 
operations, health centers will connect more effectively with 
the entire health care system, and can continue to lead the way 
toward an improved system of care.

                     NATIONAL HEALTH SERVICE CORPS

Introduction

    The National Health Service Corps (NHSC), authorized under 
Title III of the Public Health Service Act, plays a critical 
role in providing care for medically underserved populations by 
placing clinicians in urban and rural communities with severe 
shortages of health care providers. The NHSC is comprised of 
scholarship and loan repayment programs that provide education 
assistance to health professions students in return for a 
period of obligated service in a shortage area.

Background and need for Program

    Nationwide, there is a shortage of primary care providers, 
and this problem is exacerbated in rural and certain urban 
areas. The availability of primary care physicians has 
deteriorated in recent years. In fact, the number of primary 
care physicians per capita has changed very little, while the 
number of specialists has been rapidly growing--accounting for 
more than three-quarters of the growth in per capita physicians 
from 1980 to 1999. At the same time, it is estimated that the 
demand for primary care providers will increase 38 percent from 
2000 to 2020. The lack of primary care physicians is expected 
to be compounded by a rapidly rising elderly population. The 
number of people ages 65 and older is expected to grow 54 
percent between 2000 and 2010, while the number over the age of 
85 will grow 43 percent over the same time.\17\ This 
combination of factors will lead to a growing shortage of 
primary care providers, estimated by the Council on Graduate 
Medical Education to be a shortage of at least 90,000 full time 
physicians by 2020.\18\ Communities that are already 
experiencing shortages are especially likely to be hard hit. 
Additionally, low income individuals will bear a significant 
burden, because studies suggest that fewer physicians are 
willing to treat Medicaid and uninsured patients. Therefore, 
investment in the NHSC program, which helps to get providers in 
these medically underserved communities, is needed.
---------------------------------------------------------------------------
    \17\American College of Physicians. The Impending Collapse of 
Primary Care Medicine and Its Implications for the State of the 
Nation's Health Care. January 30, 2006. http://www.acponline.org/hpp/
statehc06_1.pdf.
    \18\Council on Graduate Medical Education (January 2005). Sixteenth 
Report: Physician Workforce Policy Guidelines for the United States, 
2000-2020. http://www.cogme.gov/16.pdf.
---------------------------------------------------------------------------
    While NHSC assignees are successful in providing health 
care services to nearly 5 million Americans each year, there is 
still a great need for investment in the program. This is 
demonstrated by the fact that there are more qualified 
applicants to the NHSC program than awards available to be 
made. In 2006 there were approximately 1,800 applicants to the 
program, but only sufficient funding to award approximately 800 
awards. Additionally, the number of vacancies posted on the 
NHSC Job Opportunity List far exceeds the number of NHSC 
awardees. As of October 2007, there were 4,888 vacancies posted 
on the Job Opportunity List, with 55 percent (2,704) of these 
in health centers.

History and description of program

    The National Health Service Corps (NHSC) program was 
originally enacted by the Emergency Health Personnel Act of 
1970 to respond to the geographic misdistribution of primary 
care health professionals. In 1972, Congress created the 
Scholarship programs to allow health professions students to 
receive support for their educational costs in return for 
service in a designated area. In return for each year of 
scholarship support they receive, students agree to provide 
services for 1 year, with a 2-year minimum service obligation. 
In 1987, Congress enacted the NHSC Loan Repayment program, 
under which the Federal Government agrees to repay both 
governmental and commercial loan obligations incurred by health 
professionals for their education in exchange for service in a 
designated area. In that same year, Congress established a 
State Loan Repayment program. Under this program, if a State 
establishes a loan repayment program similar to the NHSC Loan 
Repayment program, the Department could fund up to 75 percent 
of the total costs through a grant to the State.
    In 1990, Congress reauthorized the NHSC, extending the 
program for 10 years with the enactment of the National Health 
Service Corps Revitalization Amendments of 1990 (P.L. 101-597). 
In reauthorizing the NHSC, Congress made several changes to the 
program, including a strict prioritization of areas of greatest 
shortages for placement of new assignees; requirements to 
include individual assignees' characteristics in making 
placements; improved incentives for recruitment and retention 
of health professionals; increased utilization of nurse 
practitioners, physician assistants, and nurse midwives; and 
renaming of Health Manpower Shortage Areas (HMSAs) to Health 
Professions Shortage Areas (HPSAs). The NHSC was last 
reauthorized in 2002, and this authorization expired on 
September 30, 2006.
    While the NHSC program has proven successful in addressing 
health professional shortages in many areas, funding 
limitations have restricted the program's ability to meet its 
primary goal. After reauthorization of the NHSC in 2002, 
funding for the program increased to $171 million in fiscal 
year 2003, $169.9 million in fiscal year 2004, and $131.4 
million in fiscal year 2005, before returning to the fiscal 
year 2001 level of $125 million in fiscal year 2006 and fiscal 
year 2007.
    According to HRSA, in 2006, 4,109 clinicians were 
practicing in underserved areas through the National Health 
Service Corps. Of these, 2,051 clinicians worked in grant 
supported health centers, while the remaining 2,058 clinicians 
worked in ``free standing'' sites which include rural health 
centers, public health departments, community mental health 
centers, private and group practices, Indian Health Service 
sites (tribal and Federal), State and Federal prisons, and 
Immigration and Customs Enforcement sites. NHSC funding is 
available to a variety of clinicians, including physicians 
(including psychiatrists), dentists, dental hygienists, nurse 
practitioners, physician assistants, nurse midwives, and mental 
and behavioral health professionals. Throughout its history, 
NHSC awards have also been made to other types of providers 
such as optometrists, chiropractors, and pharmacists. The 
committee notes that in many cases, the provision of some 
health care services may not have been possible without the 
presence of an NHSC assignee. Nevertheless, the committee also 
notes that partly due to a lack of adequate funding, the NHSC 
has a limited capacity to meet the needs of people living in 
primary care, mental, or dental HPSAs.

Relationship between health centers and rural health clinics and the 
        NHSC

    There is synergy between the NHSC program and the community 
health centers program and rural health clinics because both 
entities frequently utilize NHSC providers to staff their 
facilities. However, despite the investment already being made 
in placing providers in these entities, there is still a 
shortage of providers in these, as well as other settings. In 
light of the national shortage of primary care providers, the 
committee strongly believes that we must act to reauthorize and 
improve the NHSC program to help meet the need for physicians 
caring for underserved populations. Our increased investment in 
community health centers since 2001 should be matched by 
additional authorizations for the NHSC as well.

                       RURAL HEALTH CARE PROGRAMS

    In section 330A(j) of the PHSA, the committee reauthorizes 
Rural Health Care Services Outreach, Rural Health Network 
Development, and Small Health Care Provider Quality Improvement 
Grant Programs. The programs in section 330A(j) specifically 
consider the diversity of rural America and have provided rural 
communities with flexible mechanisms of receiving Federal funds 
for specific health care needs. The five grant programs under 
this authority support collaborative models to deliver basic 
health care services to the 54 million Americans living in 
rural areas.
    The Rural Health Care Services Outreach Program supports 
projects that demonstrate creative or effective models of 
outreach and service delivery in rural communities that lack 
essential health care services. The emphasis is on community 
involvement in the development and ongoing operation of the 
program, requiring the grantee to form a consortium with at 
least two additional partners. Through consortia of schools, 
churches, emergency medical service providers, local 
universities, private practitioners and the like, rural 
communities have managed to provide many services including 
hospice care, health check-ups for children and prenatal care 
to women in remote areas. The population served by the grants 
has historically been across the spectrum of care, with a 
majority of grants focusing on the non-Medicare population. The 
Department of Health and Human Services estimates these funds 
have brought care that would not otherwise have been available 
to at least 2 million rural citizens across the country. In the 
past 3 years, this program has funded many projects, including 
a grant to rural New Hampshire enabling implementation of a 
chronic disease management program for individuals with 
diabetes and congestive heart failure; a grant to rural 
Louisiana targeting at-risk and obese preteens; and a program 
in rural Kansas providing dental services targeted to children 
and pregnant women. The general program line includes support 
for grants to the eight States in the Mississippi Delta for 
network and rural health infrastructure development, and a 
cooperative agreement supporting targeted activities focusing 
on frontier extended stay clinics.
    The Small Health Care Provider Quality Improvement 
provision, a subset of the Rural Health Outreach Grant Program, 
was added to this authority when the program was re-authorized 
by the Safety Net Amendments of 2002. The programs were 
initially funded in 2006. These grants help small health care 
providers focus on specific interventions to improve health 
care quality in specific chronic disease areas. Fifteen grants 
were awarded in fiscal year 2007 with a focus on diabetes, and 
there are plans for up to 60 grants in fiscal year 2008 
targeting cardiovascular disease. These grant programs provide 
an opportunity for grantees to improve quality and enhance 
small rural health care providers in delivering care to rural 
communities.
    The Rural Health Network Development grant program allows 
grants to fund the integration of health services provided by 
rural communities. This integration helps to overcome the 
fragmentation of health care services in rural areas, improves 
the coordination of those services, and achieves economies of 
scale. The grants focus on integrating clinical, information, 
administrative and financial systems across members. This 
integration enables rural communities to strengthen the 
infrastructure of health delivery.
    In authorizing the continuation of these programs, the 
committee recognizes the great importance of these flexible 
grants in enabling smaller, rural communities to provide health 
services to a population of about 3.2 million that is 
frequently underserved, have higher rates of poverty and 
unemployment, are older, and have a poorer health status.

                              II. Summary

    The purpose of the Health Care Safety Net Act of 2007 is to 
amend the Public Health Service Act to provide additional 
authorizations of appropriations for fiscal year 2008 through 
fiscal year 2012 for Health Centers, the National Health 
Service Corps, and Rural Health Programs, to meet the health 
care needs of medically underserved populations.

                        COMMUNITY HEALTH CENTERS

    The legislation increases authorization levels for the 
health centers program, and also authorizes several studies 
including:
    1. A school based health center study conducted by the 
Comptroller General of the United States.
    2. A health care quality study conducted by the Agency for 
Healthcare Research and Quality.
    3. A study on an integrated health systems model for the 
delivery of care to medically underserved population conducted 
by the Comptroller General of the United States.

                     NATIONAL HEALTH SERVICE CORPS

    The National Health Service Corps is amended by increasing 
the authorization levels for fiscal year 2008 through fiscal 
year 2012. Additionally, the bill strikes language that placed 
a 6-year time limit on automatic Health Professional Shortage 
Area (HPSA) facility designations that were extended to 
Federally Qualified Health Centers (FQHCs) and Rural Health 
Clinics (RHCs). The NHSC is also amended to provide increased 
emphasis on professional development and training for Corps 
members.

                       RURAL HEALTHCARE PROGRAMS

    The authorization level for rural health care programs is 
increased to $45 million for fiscal years 2008 through 2012.

           III. History of Legislation and Votes in Committee

    The Community Health Centers, National Health Service 
Corps, and rural health programs were last reauthorized in the 
107th Congress with the Health Care Safety Net Amendments of 
2001 (S. 1533). This bill was passed by the House and Senate, 
and became Public Law No. 107-251 on October 26, 2002.
    During the 109th Congress, Senator Hatch and 63 cosponsors 
introduced, S. 3771, The Health Centers Renewal Act of 2006. 
This bill amended the Public Health Service Act to include 
increased authorization of appropriations for the Community 
Health Centers program. The bill was read twice and referred to 
the committee. On September 20, 2006, the committee ordered the 
bill to be reported without amendment favorably to the full 
Senate. On September 25, 2006, Senator Enzi reported the bill 
with an amendment in the nature of a substitute, without 
written report. The bill was placed on the Senate Legislative 
Calendar under General Orders (Calendar no. 638). No further 
action was taken on this bill during the 109th Congress.
    The bill was reintroduced in the 110th Congress as S. 901, 
the Health Centers Renewal Act of 2007 by Senator Kennedy on 
March 15, 2007. The bill, which had 17 original cosponsors, and 
68 total cosponsors, amended the Public Health Service Act to 
include increased authorization of appropriations for the 
Community Health Centers program for fiscal years 2008 through 
2012. The bill was combined with S. 941 introduced by Senator 
Sanders. On November 14, 2007 the committee considered and 
unanimously approved a manager's amendment to S. 901, and the 
committee approved the bill, as amended, by voice vote. The 
bill was placed on the Senate Legislative Calendar under 
General Orders (Calendar no. 548) on December 18, 2007.

              IV. Explanation of Bill and Committee Views

    The committee recognizes that the health centers, NHSC, and 
rural grants programs have made a significant contribution to 
the health of medically needy populations. The committee bill 
reauthorizes the programs, and increases the authorization 
levels for 5 years, beginning in fiscal year 2008.

                        COMMUNITY HEALTH CENTERS

Explanation of bill

    The legislation increases the authorization levels for the 
community health centers program as follows:
          $2,213,020,000 in fiscal year 2008;
          $2,451,394,400 in fiscal year 2009;
          $2,757,818,700 in fiscal year 2010;
          $3,116,335,131 in fiscal year 2011; and
          $3,537,040,374 in fiscal year 2012.
    Additionally, the legislation authorizes several studies as 
follows:
    1. A study on school-based health centers to be conducted 
by the Comptroller General of the United States. The study 
would determine the impact of Federal funding on the operation 
of school-based health centers, costs savings to other 
programs, the impact on the Federal budget and the health of 
students by providing funds, and the impact of access to health 
care from school-based health centers in rural or underserved 
areas.
    2. A health care quality study to be conducted by HRSA. 
HRSA would produce a report that describes the agency's efforts 
to expand and accelerate quality improvement activities in 
health centers.
    3. A study on the integrated health systems model for the 
delivery of health care services to medically underserved 
populations. The GAO shall conduct a study on integrated health 
systems models at not more than 10 sites.
    Forty-seven million Americans continue to lack health 
insurance and the number of uninsured continues to rise. Many 
private, nonprofit safety net providers have a historical 
mission of serving the poor and vulnerable and many of these 
providers established neighborhood clinics as a way to improve 
access to primary and preventive care, and to offer the 
uninsured a cost-effective alternative to the hospital 
emergency room for their primary care needs. In this study, the 
Comptroller General of the United States would be required to 
report back to Congress on the role of integrated health care 
systems in providing access to primary and preventive care to 
the medically underserved, as well as access to specialty and 
hospital care. For purposes of this study, an integrated health 
system is defined as a private nonprofit health system that has 
a demonstrated capacity and commitment to provide a full range 
of primary, specialty, and hospital care in both inpatient and 
outpatient settings and is organized to provide such care in a 
coordinated fashion. The Comptroller General should include in 
its report any economies of scale that are beneficial to a 
clinic because of its affiliation with a parent provider, 
current sources of its funding, patient mix based on income and 
insurance status, payer reimbursement rates in comparison to 
other providers, the number of patients served by the clinic, 
and whether these clinics improve specialty and hospital access 
for poor and vulnerable populations.
    Such study shall include an assessment of providers in a 
wide variety of settings, including inner city, frontier areas, 
and a major rural teaching hospital defined as a hospital that 
is located in a rural area (as defined in Section 1886(d)(2)(D) 
of the Social Security Act) that is engaged in approved 
graduate medical education residency programs in medicine, 
osteopathy, dentistry, or podiatry, and sponsors accredited 
residency and fellowship programs, including active programs in 
medicine, surgery, obstetrics/gynecology, pediatrics, family 
practice, and psychiatry. One nurse managed health clinic 
should also be included and would be defined as an integrated 
health system for purposes of this study (the term ``nurse-
managed health clinic'' means nurse-practice arrangement, 
managed by advanced practice nurses, that provides care for 
underserved and vulnerable populations and is associated with a 
school, college or department of nursing and/or an independent 
non-profit health or social services agency). Finally, clinics 
operated by large non-profit organizations with a historical 
commitment to providing primary and preventive care for the 
medically underserved should also be included.

 Committee views

             Importance of health centers' base grant adjustments
     Considerable investment in new community health centers 
and in expansion of services at existing CHCs has occurred 
during the past 5 years with strong leadership by the Executive 
and Congressional branches of the government. The committee 
supports the addition of new health centers and expansion of 
existing ones, and supports consideration of base grant 
adjustments for health centers that meet Program Expectation 
guidelines. Most CHCs operate on narrow margins, and there are 
ongoing requirements to keep up with rising costs for 
providers, facilities, technology, and energy in order to 
sustain current service levels. Health centers also face 
increasing numbers of uninsured and under-insured individuals 
as employer-based insurance shrinks. The committee notes that 
Congress has routinely allocated annual increased funding for 
existing centers to offset the rising cost of health care and 
to meet the demands for care for the uninsured populations 
served by the centers. The committee encourages HRSA to develop 
criteria and allocate funding that will allow health centers to 
receive an annual grant adjustment that adequately addresses 
rising costs, growing patient populations, and other pressing 
concerns as they arise.
             Value and importance of expanded technical assistance
     The committee believes that the health centers program has 
been successful in large part because of attention to 
continuous quality improvement to all facets of health center 
operations. The committee recognizes the valuable information, 
training and technical assistance activities performed by 
national, State and regional organizations that represent the 
recipients of service grants under the health centers program. 
These organizations have provided a full range of tools for 
health center staff, including training programs regarding 
financial management, clinical practice guidelines, regulatory 
and legal requirements, board governance, corporate compliance, 
program planning and proposal writing, and strategic business 
planning. In order to ensure the sustained and successful 
operation and expansion of the health centers program, the 
committee expects the collaborative technical assistance 
program, and the funding provided in support of it, to be 
continued and expanded.
             Proportional funding allocation
     The committee continues the statutory funding allocation 
requirement for the Community Health, Migrant, Homeless, and 
Public Housing sub authorities under section 330. The committee 
restored this funding allocation requirement in P.L. 107-251, 
enacted in 2002. The committee notes that when the four 
separate health center programs were consolidated under a 
single section 330 authority in 1996, the law included a 
requirement for allocating funds appropriated under section 330 
for each of the sub authorities in accordance with the 
proportion of total funding they each received in Fiscal Year 
1996. The committee recognizes that despite the expiration of 
this statutory funding allocation requirement in 1998, the 
Secretary has continued to adhere to the proportional 
allocation methodology in distributing overall health centers 
program funding among the four health center programs sub 
authorities, thus enabling health center programs to provide 
needed services to vulnerable, hard to reach ``special 
populations'' such as homeless individuals, residents of public 
housing projects, and migrant and seasonal farmworkers. These 
programs should be continued and expanded in accordance with 
the funding allocation methodology in the statute. The 
committee commends the Secretary for continuing to allocate the 
same percentage each fiscal year as was allocated the previous 
years. The committee encourages HRSA to expand and enhance the 
provision of technical assistance to promote high quality 
applications for funding to serve special populations as well 
as sparsely populated communities.
            Importance of health center owned and controlled networks
     Health centers currently collaborate with each other and 
with other community providers, in many different forms of 
networks and partnerships designed to improve operational 
quality, efficiency, and effectiveness. These collaborations 
include managed care, integrated service, and practice 
management networks, which are designed to improve quality of 
care through shared expertise (such as shared electronic 
medical records systems, centralized pharmaceutical or 
laboratory services, clinical outcomes management, and/or joint 
management/ administrative services), to lower costs through 
shared services (such as unified financial or Management 
Information systems, or joint purchasing of services or 
supplies), or to improve access and availability of health care 
services. Today, nearly 200 health centers are involved in 
approximately 20 local and regional operational networks across 
a majority of States, each designed to lower costs and improve 
care. These networks have played a central role in the 
adoption, integration and maintenance of Health Information 
Technology (HIT), including Electronic Health Records (EHR) at 
and among health centers nationwide. Most of these networks, 
once developed, need ongoing operational support to continue 
and further enhance their benefits. The committee supports the 
continued use of these public-private partnerships to assist 
with the provision of health care services, and encourages the 
Secretary to continue allocating a portion of an increase in 
appropriated funds towards this purpose.
            Expanding access through the Health Centers program
     The committee supports continued efforts to expand the 
Health Centers program into medically underserved communities 
and populations with high poverty and no current access to a 
health center. The committee commends States that have made 
commitments to expanding access to Community Health Centers to 
all underserved areas throughout their States, and believes 
that these States should be given serious consideration when 
expansion opportunities are made available.

                      NATIONAL HEALTH SERVICE CORPS

     The committee recognizes the importance of reauthorizing 
the National Health Service Corps program to demonstrate our 
commitment to addressing the need to locate providers in 
medically underserved areas. The legislation increases the 
authorization level for the NHSC program as follows:
          $131,500,000 in fiscal year 2008;
          $143,335,000 in fiscal year 2009;
          $156,235,150 in fiscal year 2010;
          $170,296,310 in fiscal year 2011; and
          $185,622,980 in fiscal year 2012.

Automatic HPSA designation for community health centers and rural 
        health clinics

     The committee revised the NHSC placement criteria during 
the last reauthorization in 2002. The amended statute extended 
Automatic HPSA facility status to health centers and rural 
health clinics, thus making them eligible for placement of NHSC 
personnel, in order to reduce bureaucratic barriers to allow 
coordinated use of Federal resources in meeting the health care 
needs of areas that lack sufficient providers and services. 
That action recognized that the NHSC, health centers, and rural 
health clinics programs are intended to address similar goals: 
to meet the primary care needs of underserved populations.
     The committee is striking language that placed a 6-year 
time limit on automatic Health Professional Shortage Area 
(HPSA) facility designations that were extended to Federally 
Qualified Health Centers (FQHCs) and Rural Health Clinics 
(RHCs). It is the committee's intent that FQHCs and RHCs 
automatic HPSA designation continue. The committee notes that 
all FQHCs must by law be located in medically underserved areas 
as determined by the Secretary, and that both FQHCs and RHCs 
must compete with all applicants to obtain NHSC placements. 
Therefore, the committee has concluded that the 6-year limit is 
unnecessary. The committee also notes concern about the current 
HPSA scoring process and its effect on certain medically 
underserved communities.

 Inclusion of other health care providers

     Currently various types of primary care providers are 
funded through the NHSC scholarship and loan repayment 
programs. The committee recognizes that the intent of the NHSC 
program, as stated in statute, is to assure an adequate supply 
of primary care providers such as physicians, dentists, 
behavioral and mental health professionals, certified nurse 
midwives, certified nurse practitioners, and physicians 
assistants, and if needed by the Corps, other health 
professionals. The committee understands that these other 
practitioners provide first contact care for basic health 
services that are needed by most or all of the population. For 
the purposes of the Act, Section 338B National Health Service 
Corps Loan Repayment Program, the term ``other health 
professionals'' is intended to include optometrists, 
pharmacists, chiropractors, and physical therapists.

 Frontier areas

     The health care challenges facing rural America are 
magnified in the Nation's frontier. Frontier communities often 
do not have adequate access to health care providers. Their 
populations must travel for an excessive time or across a great 
distance to see a doctor, dentist, or counselor. Even when 
frontier communities have local access to health care, they are 
frequently underserved. Moreover, frontier communities may fail 
to be designated as HPSA because the population-to-provider 
ratio used can overestimate a frontier population's access to 
health care. There are two reasons for this problem. First, 
frontier communities are sparsely populated. Low population 
communities can exceed the 3000-to-1 threshold with a single 
health provider. Second, the population-to-provider ratio 
ignores the extra strain that geographic isolation imposes on 
health care providers. For example, a frontier area with a 
population of 4,000 may be served by only a few healthcare 
providers. With the nearest hospital an hour long drive or more 
away, these few providers may need to work long hours every day 
of the week to provide critical emergency care in addition to 
basic health care.
     The committee recommends that HRSA consider the challenges 
faced by frontier areas in the HPSA scoring process. The 
committee also encourages HRSA to consider incorporating other 
factors into the HPSA scoring process, such as the travel time 
and/or distance frontier residents have to travel to reach the 
nearest health care center. Consideration of these factors may 
more accurately reflect a frontier community's true access to 
health care.

Professional development

     The Public Health Service Act is amended in two places to 
include an increased emphasis on professional development and 
training for Corps members. Section 333 amends the assignment 
of Health Professional Shortage Areas to include language 
indicating that the entity demonstrate a willingness to support 
or facilitate mentorship, professional development, and 
training opportunities for Corps members. Section 336, 
subsection d is amended to include a section on professional 
development and training.
     More than 3,000 Health Professional Shortage Areas have 
been designated in our country, and approximately 56 million 
people live in communities without access to health care. The 
National Health Service Corps program was developed to help 
assign Federal personnel to these shortage areas. It was later 
expanded to provide scholarships to health professionals who 
then provided service to underserved communities. Currently, 
there are more than 4,000 health care professionals serving 
with the National Health Service Corps and providing care to 
communities that lack adequate access to primary care. However, 
there is still enormous unmet need in the program, with more 
sites that request health professionals than there are 
enrollees in the program.
     Part of this shortage is due to the lack of funding for 
the program; part of this shortage is due to changes in the 
number of health professionals choosing careers in primary 
care. From 1995 to 2005, the number of medical school graduates 
entering family medicine training programs dropped by double 
digits.\19\ In addition, there are shortages of faculty needed 
to train other primary care providers, like nurse 
practitioners. As a result, the National Health Service Corps 
is facing competition for an increasingly limited pool of 
health professionals.
---------------------------------------------------------------------------
    \19\Journal of the American Medical Association Sept 7, 2005; Vol 
294, No 9.
---------------------------------------------------------------------------
     While the National Health Service Corps provides 
scholarships and loan repayment opportunities, in this 
reauthorization, the committee sought to increase the 
incentives to help with recruitment and retention of primary 
care providers. The reauthorization contains language to expand 
the types of professional development opportunities available 
to enrollees, including expanding the professional and support 
networks among enrollees, and encouraging increased use of 
distance learning opportunities. In addition, the 
reauthorization requires entities seeking NHSC enrollees to 
demonstrate willingness to support professional development and 
training opportunities. With this expansion, the committee 
believes that NHSC members will have added benefits that may 
help to increase recruitment and retention.

                            V. Cost Estimate

                                     U.S. Congress,
                               Congressional Budget Office,
                                    Washington, DC, March 11, 2008.
Hon. Edward M. Kennedy, Chairman,
Committee on Health, Education, Labor, and Pensions,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for S. 901, the Health Care 
Safety Net Act of 2007.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Lara 
Robillard.
            Sincerely,
                                         Robert A. Sunshine
                                   (For Peter R. Orszag, Director).
    Enclosure.

S. 901--Health Care Safety Net Act of 2007

    Summary: S. 901 would amend the Public Health Service Act 
to authorize programs that provide funding for community health 
centers, the National Health Service Corps, and certain rural 
health programs administered by the Health Resources and 
Services Administration.
    The bill would authorize the appropriation of $2.4 billion 
for 2008 and $15.1 billion over the 2008-2012 period. However, 
$2.2 billion has already been appropriated for those activities 
for 2008. Thus, S. 901 would authorize the appropriation of an 
additional $0.2 billion for fiscal year 2008 and $12.9 billion 
over the 2008-2012 period.
    CBO estimates that implementing the bill would cost $94 
million in 2008, $1.5 billion in 2009, and $12.5 billion over 
the 2008-2013 period, assuming the appropriation of the 
authorized amounts. S. 901 would not affect direct spending or 
revenues.
    S. 901 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA) 
and would impose no costs on state, local, or tribal 
governments.
    Estimated cost to the Federal Government: The estimated 
budgetary impact of S. 901 is shown in the following table. The 
costs of this legislation fall within budget function 550 
(health).

----------------------------------------------------------------------------------------------------------------
                                                                     By fiscal year, in millions of dollars--
                                                                 -----------------------------------------------
                                                                   2008    2009    2010    2011    2012    2013
----------------------------------------------------------------------------------------------------------------
                                        SPENDING SUBJECT TO APPROPRIATION

Spending Under Current Law:
    Community Health Centers:
        Budget Authority........................................   2,022       0       0       0       0       0
        Estimated Outlays.......................................   2,035     989     231       0       0       0
    National Health Service Corps:
        Budget Authority........................................     123       0       0       0       0       0
        Estimated Outlays.......................................     122      62      10       0       0       0
    Rural Health Outreach Grants:
        Budget Authority........................................      48       0       0       0       0       0
        Estimated Outlays.......................................      47      20       2       0       0       0
    Total:
        Budget Authority........................................   2,193       0       0       0       0       0
        Estimated Outlays.......................................   2,204   1,071     243       0       0       0
Proposed Changes:
    Community Health Centers:
        Authorization Level.....................................     191   2,451   2,758   3,116   3,537       0
        Estimated Outlays.......................................      90   1,383   2,505   2,883   3,266   1,579
    National Health Service Corps:
        Authorization Level.....................................       8     143     156     170     186       0
        Estimated Outlays.......................................       4      79     144     160     175      83
    Rural Health Outreach Grants:
        Authorization Level.....................................       0      45      45      45      45       0
        Estimated Outlays.......................................       0      24      43      44      44      20
    Total Changes:
        Authorization Level.....................................     199   2,639   2,959   3,331   3,768       0
        Estimated Outlays.......................................      94   1,486   2,692   3,087   3,485   1,682
Estimated Spending Under S. 901:
    Community Health Centers:
        Authorization Level.....................................   2,213   2,451   2,758   3,116   3,537       0
        Estimated Outlays.......................................   2,125   2,372   2,736   2,883   3,266   1,579
    National Health Service Corps:
        Authorization Level.....................................     131     143     156     170     186       0
        Estimated Outlays.......................................     126     141     154     160     175      83
    Rural Health Outreach Grants:
        Authorization Level.....................................      48      45      45      45      45       0
        Estimated Outlays.......................................      47      44      45      44      44      20
    Total Spending:
        Authorization Level.....................................   2,392   2,639   2,959   3,331   3,768       0
        Estimated Outlays.......................................   2,298   2,557   2,935   3,087   3,485  1,682
----------------------------------------------------------------------------------------------------------------
Note: Components may not add to totals because of rounding.

    Basis of estimate: S. 901 would authorize three programs 
that provide funding for health programs in rural and medically 
underserved areas. In total, the bill would authorize the 
appropriation of $2.4 billion for 2008 and $15.1 billion over 
the 2008-2012 period. The Omnibus Appropriations Act (Public 
Law 110-161) appropriated $2.2 billion in 2008 for those 
activities. Thus, S. 901 would authorize the appropriation of 
an additional $199 million for fiscal year 2008 and $12.9 
billion over the 2008-2012 period.
    Based on historical patterns of spending for those 
programs, and assuming the appropriation of the authorized 
amounts, CBO estimates that implementing the bill would cost 
$94 million in 2008, $1.5 billion in 2009, and $12.5 billion 
over the 2008-2013 period.
    Community health centers are community-based and patient-
directed organizations that serve populations with limited 
access to primary health care services. S. 901 would authorize 
the appropriation of $2.2 billion for 2008 (an increase of $191 
million over the current appropriation), and $11.9 billion over 
the 2009-2012 period. Assuming the appropriation of the 
additional funds for 2008 in the spring, and the appropriation 
of the authorized amounts in subsequent years, CBO estimates 
that spending for the community health center program from the 
funds authorized by this bill would total $90 million in 2008 
and $11.7 billion over the 2008-2013 period.
    The National Health Service Corps operates loan repayment 
and scholarship programs for clinicians who provide primary 
care services in medically underserved areas. S. 901 would 
authorize the appropriation of $132 million for 2008 (an 
increase of $8 million over the current appropriation), and 
$655 million over the 2009-2012 period. Assuming the 
appropriation of the additional funds for 2008 in the spring, 
and the appropriation of the authorized amounts in subsequent 
years, CBO estimates that spending for the National Health 
Service Corps program from the funds authorized by this bill 
would total $4 million in 2008 and $645 million over the 2008-
2013 period.
    The rural health care services outreach, network and 
quality improvement program provides grants for activities to 
increase access to primary health care services in rural areas; 
help rural health care providers develop community-based, 
integrated systems of care; and improve the quality of health 
care for certain chronic diseases. The bill would authorize the 
appropriation of $45 million a year for fiscal years 2008 
through 2012. The amount authorized for 2008 is less than the 
$48 million appropriated for 2008. Therefore, the estimate 
assumes that enacting S. 901 would have no effect on funding 
for 2008. Assuming the appropriation of the amounts authorized 
for fiscal years 2009 through 2012, CBO estimates that spending 
for rural health outreach grants from the funds authorized by 
this bill would total $175 million over the 2008-2013 period.
    Intergovernmental and private-sector impact: S. 901 
contains no intergovernmental or private-sector mandates as 
defined in UMRA. Funds authorized in the bill would benefit 
local governments that participate in community and rural 
health programs.
    Estimate prepared by: Federal Costs: Lara Robillard; Impact 
on State, Local, and Tribal Governments: Lisa Ramirez-Branum; 
Impact on the Private Sector: Patrick Bernhardt.
    Estimate approved by: Keith J. Fontenot, Deputy Assistant 
Director for Health and Human Resources, Budget Analysis 
Division.

                    VI. Regulatory Impact Statement

    The committee has determined that there is no legislative 
impact.

           VII. Application of Law to the Legislative Branch

    The committee has determined that there will be minimal 
increases in the regulatory burden imposed by this bill.

                   VIII. Section-by-Section Analysis


Section 1. Short title

    Section 1 provides the short title of the bill, the 
``Health Care Safety Net Act of 2007.''

Section 2. Community Health Centers Program of the Public Health 
        Service Act

    Section 2 part (a) amends section 330(r) of the Public 
Health Service Act to increase the authorization levels for the 
Health Centers Program for Fiscal Year 2008-2012.
    Part (b) includes several studies relating to community 
health centers.
    Subsection 1 includes definitions of the terms ``community 
health center'' and ``medically underserved.''
    Subsection 2 describes a school based health center study 
to be conducted by the Comptroller General of the United 
States. No later than 2 years after the enactment of the act, 
the GAO shall study the economic costs and benefits of school 
based health centers and the impact on the health of students 
served by these centers. The study would analyze the impact of 
Federal funding on the operation of school based health 
centers, any cost savings to other Federal programs derived 
from providing services in these centers, the potential impact 
on the Federal budget and the health of students, and the 
impact on access to health care in rural or underserved areas.
    Subsection 3 describes a health care quality study to be 
conducted by the Agency for Healthcare Research and Quality 
(AHRQ). This study would describe AHRQ's efforts to expand and 
accelerate quality improvement activities in community health 
centers, including Federal efforts towards improved healthcare 
quality, identification of effective models for quality 
improvement, and efforts to determine how effective quality 
improvement models may be adapted for implementation by CHCs 
with varying characteristics such as size, budget, staffing 
etc. This section also directs the Administrator of HRSA to 
establish a formal mechanism for the ongoing dissemination of 
agency initiatives, best practices, and other information that 
may assist health care quality improvement efforts.
    Subsection 4 describes a study to be conducted by the GAO 
on an integrated health systems model for the delivery of 
health care services to medically underserved populations. This 
study, to be conducted at not more than 10 sites, would examine 
health care delivery models sponsored by public or nonprofit 
entities that integrate primary, specialty, and acute care and 
serve medically underserved populations in rural or urban 
areas. The report would evaluate the model's ability to expand 
access to primary and preventive services for medically 
underserved populations, improve care coordination and health 
care outcomes, while also assessing the challenges in providing 
care to medically underserved populations, and the advantages 
and disadvantages of such health care delivery models compared 
to other such models.

Section 3. National Health Service Corps

    Section 3 part (a) amends section 331 through 338G of the 
Public Health Service Act to increase the authorization levels 
for the National Health Service Corps program for Fiscal Years 
2008-2012.
    Part (b) amends section 332(a)(1) of the Public Health 
Service Act to strike language that limited the automatic 
Health Professions Shortage Area designation for Community 
Health Centers and rural health programs to 6 years. The 
automatic HPSA designation will continue indefinitely.
    Part (c) amends section 333(a)(1)(D)(ii) of the Public 
Health Service Act on the assignment of personnel to HPSAs to 
include a new requirement that a site seeking a NHSC assignee 
must demonstrate a willingness to support mentorship, 
professional development, and training opportunities for Corps 
members.
    Part (d) amends subsection (d) of section 336 of the Public 
Health Service Act to include a new section on professional 
development and training. This new language requires the 
Secretary to assist Corps members in establishing and 
maintaining professional relationships and development 
opportunities. In providing this assistance, the Secretary 
shall focus on establishing relationships with hospitals, 
academic medical centers, health professions schools, area 
health education centers, health education and training 
centers, and border health education and training centers. The 
Secretary shall also assist Corps members in obtaining faculty 
appointments at health professions schools.

Section 4. Reauthorization of Rural Health Care Programs

    Section 4 amends section 330A(j) of the Public Health 
Service Act by increasing the authorization level for rural 
health care programs to $45 million for fiscal years 2008 
through 2012.

                      IX. Changes in Existing Law

    In compliance with rule XXVI paragraph 12 of the Standing 
Rules of the Senate, the following provides a print of the 
statute or the part or section thereof to be amended or 
replaced (existing law proposed to be omitted is enclosed in 
black brackets, new matter is printed in italic, existing law 
in which no change is proposed is shown in roman):

PUBLIC HEALTH SERVICE ACT

           *       *       *       *       *       *       *



SEC. 330. [254B] HEALTH CENTERS.

    (a) Definition of Health Center.--
          (1) In general.-- * * *

           *       *       *       *       *       *       *

    (r) Authorization of Appropriations.--
          [(1) In general.--For the purpose of carrying out 
        this section, in addition to the amounts authorized to 
        be appropriated under subsection (d), there are 
        authorized to be appropriated $1,340,000,000 for fiscal 
        year 2002 and such sums as may be necessary for each of 
        the fiscal years 2003 through 2006.]
          (1) In general.--For the purpose of carrying out this 
        section, in addition to the amounts authorized to be 
        appropriated under subsection (d), there are authorized 
        to be appropriated--
                  (A) $2,213,020,000 for fiscal year 2008;
                  (B) $2,451,394,400 for fiscal year 2009;
                  (C) $2,757,818,700 for fiscal year 2010;
                  (D) $3,116,335,131 for fiscal year 2011; and
                  (E) $3,537,040,374 for fiscal year 2012.

           *       *       *       *       *       *       *


SEC. 330A. [254C] RURAL HEALTH CARE SERVICES OUTREACH, RURAL HEALTH 
                    NETWORK DEVELOPMENT, AND SMALL HEALTH CARE PROVIDER 
                    QUALITY IMPROVEMENT GRANT PROGRAMS.

    (a) Purpose.--* * *

           *       *       *       *       *       *       *

    (j) Authorization of Appropriations.--There are authorized 
to be appropriated to carry out this section [$40,000,000 for 
fiscal year 2002, and such sums as may be necessary for each of 
fiscal years 2003 through 2006.] $45,000,000, for each of 
fiscal years 2008 through 2012.

           *       *       *       *       *       *       *

    Sec. 332. [254e] (a)(1) For purposes of this subpart the 
term ``health professional shortage area'' means (A) an area in 
an urban or rural area (which need not conform to the 
geographic boundaries of a political subdivision and which is a 
rational area for the delivery of health services) which the 
Secretary determines has a health manpower shortage, (B) a 
population group which the Secretary determines has such a 
shortage, or (C) a public or nonprofit private medical facility 
or other public facility which the Secretary determines has 
such a shortage. All Federally qualified health centers and 
rural health clinics, as defined in section 1861(aa) of the 
Social Security Act (42 U.S.C. 1395x(aa)), that meet the 
requirements of section 334 shall be automatically designated 
as having such a shortage. [Not earlier than 6 years after such 
date of designation, and every 6 years thereafter, each such 
center or clinic shall demonstrate that the center or clinic 
meets the applicable requirements of the Federal regulations 
regarding the definition of a health professional shortage area 
for purposes of this section.] The Secretary shall not remove 
an area from the areas determined to be health professional 
shortage areas under subparagraph (A) of the preceding sentence 
until the Secretary has afforded interested persons and groups 
in such area an opportunity to provide data and information in 
support of the designation as a health professional shortage 
area or a population group described in subparagraph (B) of 
such sentence or a facility described in subparagraph (C) of 
such sentence, and has made a determination on the basis of the 
data and information submitted by such persons and groups and 
other data and information available to the Secretary.

           *       *       *       *       *       *       *

    Sec. 333. [254f] (a)(1) * * *
          (A) * * *

           *       *       *       *       *       *       *

          (D) * * *
                  (I) * * *

           *       *       *       *       *       *       *

                  (IV) the area has made unsuccessful efforts 
                to secure health manpower for the area; [and]
                  (V) there is a reasonable prospect of sound 
                fiscal management, including efficient 
                collection of fee-for-service, third-party, and 
                other appropriate funds, by the entity with 
                respect to Corps members assigned to such 
                entity[.]; and
                  (VI) the entity demonstrates willingness to 
                support or facilitate mentorship, professional 
                development, and training opportunities for 
                Corps members.

           *       *       *       *       *       *       *


SEC. 336. [254H-1] FACILITATION OF EFFECTIVE PROVISION OF CORPS 
                    SERVICES.

    (a) Consideration of Individual Characteristics of Members 
in Making Assignments.--* * *

           *       *       *       *       *       *       *

    [(d) Assistance in Establishing Local Professional 
Relationships.--The Secretary shall assist Corps members in 
establishing appropriate professional relationships between the 
Corps member involved and the health professions community of 
the geographic area with respect to which the member is 
assigned, including such relationships with hospitals, with 
health professions schools, with area health education centers 
under section 781, with health education and training centers 
under such section, and with border health education and 
training centers under such section. Such assistance shall 
include assistance in obtaining faculty appointments at health 
professions schools.]
    (d) Professional Development and Training.--
          (1) In general.--The Secretary shall assist Corps 
        members in establishing and maintaining professional 
        relationships and development opportunities, including 
        by--
                  (A) establishing appropriate professional 
                relationships between the Corps member involved 
                and the health professions community of the 
                geographic area with respect to which the 
                member is assigned;
                  (B) establishing professional development, 
                training, and mentorship linkages between the 
                Corps member involved and the larger health 
                professions community, including through 
                distance learning, direct mentorship, and 
                development and implementation of training 
                modules designed to meet the educational needs 
                of offsite Corps members;
                  (C) establishing professional networks among 
                Corps members; or
                  (D) engaging in other professional 
                development, mentorship, and training 
                activities for Corps members, at the discretion 
                of the Secretary.
          (2) Assistance in establishing professional 
        relationships.--In providing such assistance under 
        paragraph (1), the Secretary shall focus on 
        establishing relationships with hospitals, with 
        academic medical centers and health professions 
        schools, with area health education centers under 
        section 751, with health education and training centers 
        under section 752, and with border health education and 
        training centers under such section 752. Such 
        assistance shall include assistance in obtaining 
        faculty appointments at health professions schools.
          (3) Supplement not supplant.--Such efforts under this 
        subsection shall supplement, not supplant, non-
        government efforts by professional health provider 
        societies to establish and maintain professional 
        relationships and development opportunities.
    Sec. 338. [254k] (a) For the purpose of carrying out this 
subpart, there are authorized to be appropriated such sums as 
may be necessary for each of the fiscal years [2002 through 
2006] 2008 through 2012.

           *       *       *       *       *       *       *


SEC. 338H. [254Q] AUTHORIZATION OF APPROPRIATIONS.

    (a) Authorization of Appropriations.--For the purposes of 
carrying out this subpart, there are authorized to be 
[appropriated $146,250,000 for fiscal year 2002, and such sums 
as may be necessary for each of fiscal years 2003 through 
2006.] appropriated--
          (1) for fiscal year 2008, $131,500,000;
          (2) for fiscal year 2009, $143,335,000;
          (3) for fiscal year 2010, $156,235,150;
          (4) for fiscal year 2011, $170,296,310; and
          (5) for fiscal year 2012, $185,622,980.

           *       *       *       *       *       *       *

    Amend the title so as to read: A bill to amend the Public 
Health Service Act to reauthorize the Community Health Centers 
program, the National Health Service Corps, and rural health 
care programs.

                                  
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