THE GENERAL ASSEMBLY OF PENNSYLVANIA

SENATE BILL

INTRODUCED BY ERICKSON, TARTAGLIONE, YAW, RAFFERTY, BROWNE, PILEGGI, TOMLINSON, M. WHITE, SCARNATI, BAKER, D. WHITE, BRUBAKER, WAUGH AND GREENLEAF, JANUARY 26, 2011

REFERRED TO EDUCATION, JANUARY 26, 2011  

AN ACT

Establishing the Physician Retention Loan Forgiveness Program in

the Pennsylvania Higher Education Assistance Agency;

providing for powers and duties of the Pennsylvania Higher

Education Assistance Agency; and making an appropriation.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1.  Short title.

This act shall be known and may be cited as the Physician

Retention Loan Forgiveness Act.

Section 2.  Purpose.

The purpose of this act is to improve patient access to

health care by assisting the Commonwealth with recruitment and

retention of physicians.

Section 3.  Definitions.

The following words and phrases when used in this act shall

have the meanings given to them in this section unless the

context clearly indicates otherwise:

"Agency."  The Pennsylvania Higher Education Assistance

Agency.

"Health care facility."  As defined in section 103 of the act

of July 19, 1979 (P.L.130, No.48), known as the Health Care

Facilities Act.

"Medically underserved area."  An area of this Commonwealth

that is reported by the Department of Health as medically

underserved.

"Physician."  A medical doctor, doctor of osteopathy or

dentist.

"Primary care health professional shortage area."  An area of

this Commonwealth that is reported by the Department of Health

as having a shortage of primary care health professionals.

"Program."  The Physician Retention Loan Forgiveness Program

established by this act.

Section 4.  Program.

(a)  Establishment.--The Physician Retention Loan Forgiveness

Program is established in the agency.

(b)  Applications.--The agency shall promulgate guidelines

for the selection of candidates to the program based upon the

following criteria:

(1)  Demonstrated need.

(2)  Willingness to continue practicing as a physician in

this Commonwealth after completing the program.

(c)  Eligibility.--A program applicant must be:

(1)  A citizen of the United States.

(2)  Licensed to practice medicine in this Commonwealth.

(d)  Selection.--The agency shall give preference to

physicians in the following order:

(1)  Commonwealth physicians completing training in this

Commonwealth who agree to practice medicine in a medically

underserved area or in a primary care health professional

shortage area.

(2)  Commonwealth physicians completing training in this

Commonwealth.

(3)  Commonwealth natives completing out-of-State

training who agree to practice in a medically underserved

area or a primary care health professional shortage area.

(4)  Out-of-State applicants completing training in this

Commonwealth who agree to practice in a medically underserved

area or a primary care health professional shortage area.

(e)  Verification.--The agency shall monitor and verify a

physician's fulfillment of all requirements under this act.

Section 5.  Amount of loan forgiveness.

(a)  Physicians practicing full time.--A physician accepted

into the program practicing full time may be reimbursed an

amount up to 100% of the total loan for physician training or no

more than $75,000, whichever is less, based upon the following

repayment assistance schedule:

(1)  First year of service, 10%.

(2)  Second year of service, 15%.

(3)  Third year of service, 15%.

(4)  Fourth year of service, 15%.

(5)  Fifth year of service, 15%.

(6)  Sixth year of service, 15%.

(7)  Seventh year of service, 15%.

(b)  Physicians practicing part time.--A physician accepted

into the program practicing part time may be reimbursed an

amount directly proportional to the number of hours worked of

the total loan for physician training or no more than $75,000,

whichever is less, based upon the following repayment assistance

schedule:

(1)  First year of service, 10%.

(2)  Second year of service, 15%.

(3)  Third year of service, 15%.

(4)  Fourth year of service, 15%.

(5)  Fifth year of service, 15%.

(6)  Sixth year of service, 15%.

(7)  Seventh year of service, 15%.

Section 6.  Contract.

(a)  General rule.--Physicians receiving loan forgiveness

shall enter into a contract with the agency. The contract shall

include, but not be limited to, the following terms and

conditions:

(1)  The physician shall agree to practice not fewer than

ten full consecutive years in a licensed health care facility

in this Commonwealth immediately following completion of

training pursuant to the schedule provided in section 5.

(2)  The physician shall agree not to discriminate

against patients based on the ability to pay.

(3)  The physician shall permit the agency to monitor

compliance with the work requirement.

(4)  The agency shall certify compliance of the physician

receiving a loan forgiveness award for years subsequent to

the initial year of the loan.

(5)  The contract shall be renewable on an annual basis

upon certification by the agency that the physician has

complied with the terms of the contract.

(6)  The contract shall terminate if the physician dies,

is not able to perform the duties of a physician or is not

able to maintain the physician's license to practice medicine

due to physical or mental disability.

(7)  If the physician's license to practice is suspended

or revoked, the agency shall have the authority to terminate

the physician's participation in the program and demand

repayment of all loan forgiveness payments rendered to date.

(8)  A physician who fails to begin or complete the

obligations contracted for shall reimburse the Commonwealth

all amounts received under this act and interest thereon as

determined by the agency. Both the physician and the agency

shall make every effort to resolve conflicts in order to

prevent a breach of contract.

(b)  Contract enforcement.--The agency shall have the

authority to seek garnishment of wages for the collection of

damages provided for in subsection (a)(8).

Section 7.  Disqualification.

Any person who knowingly or intentionally procures, obtains

or aids another to procure or obtain loan forgiveness under this

act through fraudulent means shall be disqualified from

participation and shall be liable to the agency for an amount

equal to three times the amount obtained.

Section 8.  Tax consequences.

Loan forgiveness payments received by a physician shall not

be considered taxable income for purposes of Article III of the

act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code

of 1971.

Section 9.  Regulations.

The agency shall adopt regulations and procedures necessary

to carry out the purposes of this act.

Section 10.  Funding.

Loan forgiveness payments shall be made to the extent that

funds are appropriated to the Physician Retention Loan

Forgiveness Program by the General Assembly.

Section 11.  Appropriation.

The sum of $10,000,000 shall be appropriated annually to

carry out the purposes of this act.

Section 30.  Effective date.

This act shall take effect in 90 days.