Final Methodology for Implementation of the Statutory General Funding Preference for Selected Grant Programs Under Titles VII and VIII of the Public Health Service Act for Fiscal Year 1994

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Health Resources and Services Administration

Final Methodology for Implementation of the Statutory General

Funding Preference for Selected Grant Programs Under Titles VII and

VIII of the Public Health Service Act for Fiscal Year 1994

SUMMARY: The Health Professions Education Extension Amendments of 1992

and the Nurse Education and Practice Improvement Amendments of 1992

(Pub. L. 102-408, dated October 13, 1992) authorize a general funding

preference (sections 791(a) and 860(e)(1)) for selected grant programs

in titles VII and VIII of the Public Health Service (PHS) Act. For the

purpose of making grant and cooperative agreement awards, funding

preference is defined as the funding of a specific category or group of

approved applications ahead of other categories or groups of approved

applications in a discretionary program, or favorable adjustment of the

formula which determines the grant award in a formula grant program.

This statutory general preference was implemented in Fiscal Year

(FY) 1993 following publication of a proposed Federal Register notice

(57 FR 60212, dated December 18, 1992) which announced the

implementation methodology for FY 1993. Following public comment,

modifications were made in the proposed methodology and a final notice

was published in the Federal Register (58 FR 9570, dated February 22,

1993). In addition, input was elicited from constituency groups

affected by this preference provision. The proposed methodology for FY

1994 implementation of the general funding preference was published in

the Federal Register (58 FR 40659, dated July 29, 1993). This notice

will describe the public comments received and will include the final

methodology for implementation of this statutory funding preference for

FY 1994.

EFFECTIVE DATE: The methodology for implementing the statutory general

funding preference which is described in this notice is for use in FY

1994 grant cycles for the programs which are subject to this funding

preference.

SUPPLEMENTARY INFORMATION: Sections 791(a) and 860(e)(1) of the PHS Act

include a general funding preference for selected grant programs under

titles VII and VIII. Grant programs which are subject to this funding

preference are:

Departments of Family Medicine (section 747(b)),

Grants for Predoctoral Training in Family Medicine (section 747(a)),

Grants for Graduate Training in Family Medicine (section 747(a)),

Grants for Faculty Development in Family Medicine (section 747(a)),

Grants for Predoctoral Training in General Internal Medicine and/or

General Pediatrics (section 748),\1\

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\1\No competitive cycle planned for FY 1994.

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Grants for Residency Training in General Internal Medicine and/or

General Pediatrics (section 748),

Grants for Faculty Development in General Internal Medicine and/or

General Pediatrics (section 748),

Residency Training and Advanced Education in the General Practice of

Dentistry (section 749),\1\

Grants for Physician Assistant Training Program (section 750),

Grants for Physician Assistant Faculty Development (section 750),\2\

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\2\Program currently in development.

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Podiatric Primary Care Residency Training (section 751),\1\

Grants for Preventive Medicine Residency Training (section 763),\1\

Allied Health Traineeships (section 766),\1\

Allied Health Project Grants (section 767),

Advanced Nurse Education (section 821),

Nurse Practitioner and Nurse-Midwifery Programs (section 822)

Professional Nurse Traineeships (section 830),

Nurse Anesthetist Education Programs (section 831(a)),

Nurse Anesthetist Traineeships (section 831(a)), and

Grants for Nurse Anesthetist Faculty Fellowships (section 831(b)).

Statutory General Funding Preference Provision

Under sections 791(a) and 860(e)(1) of the Act, with respect to the

above listed grant programs, preference will be given to any qualified

applicant that--

(A) has a high rate for placing graduates in practice settings

having the principal focus of serving residents of medically

underserved communities; or

(B) during the 2-year period preceding the fiscal year for which

such an award is sought, has achieved a significant increase in the

rate of placing graduates in such settings.

When program applications are peer reviewed, preference will be given

only for applications ranked above the 20th percentile of applications

that have been recommended for approval by the appropriate peer review

group. In several formula grant programs affected by this preference,

the applications are not required to be submitted to a peer review

group.

Statutory Definition of ``Graduate''

Under sections 791(c) and 860(e)(3), ``graduate'' is defined as an

individual who has successfully completed all training (and residency

requirements) necessary for full certification in the health profession

selected by the individual.

Methodology for Implementation

In the proposed notice, the public was invited to comment on the

proposed changes in the definitions of ``high rate,'' ``significant

increase in the rate,'' and ``medically underserved communities'' and

on the implementation specifics for new programs and small programs.

HRSA received 2 comments prior to the end of the comment period.

Comments regarding each of the proposed areas will be discussed.

Comments on implementation aspects that were not specifically proposed

for public comment are not addressed in this notice.

Proposed Definitions of ``High Rate'' and ``Significant Increase in the

Rate''

The proposed definition of ``high rate'' is a minimum percent of

graduates in academic year 1991-92 or academic year 1992-93, whichever

is greater, who spend at least 50 percent of their worktime in clinical

practice in the specified settings. The minimum percent for ``high

rate'' for each program was to be identified in the Federal Register

announcement for that program and in the program materials. The

following statements are proposed amplifications of the basic ``high

rate'' definition. For undergraduate medical education programs

academic years 1988-89 and 1989-90 were proposed. Preventive medicine,

public health, dental public health, and public health nurse graduates

were proposed to be counted if they identify a primary work affiliation

at one of the qualified work sites. Graduates who are providing care in

a medically underserved community as a part of a fellowship or other

educational experience were to be counted.

The proposed definition of ``significant increase in the rate'' is

that, between academic years 1991-92 and 1992-93, the rate of placing

graduates in the specified settings has increased by a minimum percent

and that not less than 15 percent of graduates from the most recent

year are working in these settings. The minimum percent for

``significant increase in the rate'' for each program was to be

identified in the Federal Register announcement for that program and in

the program materials.

One comment received from a professional association suggested that

the percentage rates published for grant programs which benefitted

their constituency should be lower. We believe that the percentage

rates are appropriate. The rates for FY 1994 are similar to the rates

used in FY 1993. In FY 1993, only 40% of grant applicants for programs

affected by this preference did not apply for the preference. Of those

applicants who did apply, 90% met the criteria and did receive

preference in funding.

Proposed Implementation Specifics for New Programs

To allow new programs to compete equitably in FY 1994, criteria for

the general funding preference were proposed which applied only to new

programs. It was proposed that a new program be defined as any program

which has graduated less than three classes. After a program has

graduated three classes, that program will be able to provide the

information necessary for the general funding preference as defined in

the law and will no longer be considered a new program.

It was proposed that a new program would qualify for the general

funding preference if four or more of the following criteria were met:

1. The mission statement of the program identifies a specific

purpose of preparing health professionals to serve underserved

populations.

2. The curriculum includes content which will help to prepare

practitioners to serve underserved populations.

3. Substantial clinical training experience is required in

medically underserved communities.

4. A minimum of 20 percent of the faculty spend at least 50 percent

of their time providing/supervising care in medically underserved

communities.

5. The entire program or a substantial portion of the program is

physically located in a medically underserved community.

6. Student assistance, which is linked to service in medically

underserved communities following graduation, is available to the

students in the program.

7. The program provides a placement mechanism for deploying

graduates to medically underserved communities.

One respondent suggested that (1) ``substantial clinical training

experience'' in criteria #3 should be defined; (2) the word ``faculty''

in criteria #4 is unclear; (3) criteria #5 should be deleted because

``the physical location of a program does not determine the practice

type;'' and (4) criteria #6 should be deleted because student

assistance does not apply to grants for residency programs. Since this

preference applies to a wide variety of programs, a single definition

of ``substantial clinical training experience'' or ``faculty'' could

not be applied generally. Individual grant programs may develop

specific definitions if this becomes necessary. Such definitions would

be included in program application materials. We believe that programs

located in medically underserved communities will provide an

opportunity for students to develop skills needed to provide care to

underserved populations. We do not plan to delete criterion #5. Since

student assistance is relevant to many of the programs which are

subject to the general preference, we do not plan to delete criterion

#6. New residency programs can qualify for the preference based on any

combination of four other criteria.

In addition, it was proposed that new programs could also qualify

for the general funding preference by providing assurance that a

minimum percent of their prospective graduates have signed commitments

to practice in medically underserved communities after graduation

contingent upon receiving some type of student assistance. This minimum

percent was to be equal to the minimum percentage for ``high rate.''

One respondent suggested that ``a non-binding agreement is a poor

indicator of the actual outcome regarding practice in a medically

underserved community.'' In FY 1993 no programs qualified for the

general preference based on signed commitments. This option was

included to provide every fair opportunity for new programs to qualify

for the preference. However, if we find that no programs qualify for

the general preference based on signed commitments in FY 1994, we will

consider deleting this mechanism to qualify for the preference for FY

1995.

Proposed Implementation Specifics for Small Programs

For FY 1994, it was proposed that the program materials for grant

programs whose applicants typically have less than 10 graduates per

year would request data for the preceding three years which will be

aggregated to determine whether or not the ``high rate'' has been

achieved. There were no comments which specifically disagreed with this

implementation strategy.

Statutory Definition of ``Medically Underserved Community''

Section 799(6) of the PHS Act defines ``medically underserved

community'' as an urban or rural area or population that--

(A) is eligible for designation under section 332 as a health

professional shortage area;

(B) is eligible to be served by a migrant health center under

section 329, a community health center under section 330, a grantee

under section 340 (relating to homeless individuals), or a grantee

under section 340A (relating to residents of public housing); or

(C) has a shortage of personal health services, as determined under

criteria issued by the Secretary under section 1861(aa)(2) of the

Social Security Act (relating to rural health clinics).

For implementation of the general funding preference in FY 1994, it

was proposed that service in a ``medically underserved community''

would include service in the following work settings:

Community Health Centers (section 330)

Migrant Health Centers (section 329)

Health Care for the Homeless Grantees (section 340)

Public Housing Primary Care Grantees (section 340A)

Rural Health Clinics, federally designated (section 1861(aa)(2) of the

Social Security Act)

National Health Service Corps sites, freestanding (section 333)

Indian Health Service Sites (Public Law 93-638 for tribally operated

sites and Public Law 94-437 for IHS operated sites)

Federally Qualified Health Centers (section 1905(a) and (l) of the

Social Security Act)

Primary Medical Care Health Professional Shortage Areas (HPSAs)

(facilities and geographic) (designated under section 332) For primary

care physicians and other health personnel except dentists and nurses

Dental HPSAs (facilities and geographic) (designated under section 332)

For dentists only

Nurse Shortage Areas (old section 836, currently section 846) For

nurses only

State or Local Health Departments (Regardless of sponsor--for example,

local health departments who are funded by the State would qualify.)

Ambulatory practice sites designated by State Governors as serving

medically underserved communities

Several concerns were included in the comments related to the

definition of ``medically underserved community.'' Many of the issues

identified related to the need for a more comprehensive list of

practice settings. For example, it was suggested that the list should

include (1) practices and/or facilities in which 50 percent or more of

the patients served are Medicaid recipients and (2) practice settings

located adjacent to medically underserved communities but serving the

underserved population. These practice settings are outside the scope

of the current statutory definition of medically underserved community.

One respondent objected to favoring applicants whose graduates are

practicing in Federally-subsidized settings while discriminating

against those applicants whose graduates are serving where special

designations have not been sought or Federal assistance utilized.

Because the statutory definition of medically underserved community is

based on Federal designations, this bias may be unavoidable. However,

an attempt has been made to make the list as comprehensive as possible,

within the confines of the law.

There was one suggestion to ``provide an opportunity for preference

to be claimed and secured based on affirmation or documentation that

graduates' practice settings are located in communities or serve

populations which meet specified eligibility criteria for HPSA or MUA/

MUP designation.'' There were also several questions related to

practice settings included on the list. For example, one letter stated

``many state and local government health department work settings

clearly do not have service to underserved communities as the principal

focus.''

While most of the suggestions made by the respondents are options

that have been considered previously, these suggestions will all be

reevaluated for consideration in the FY 1995 implementation of this

preference. We recognize that there are difficulties associated with

the implementation of this preference and we appreciate the comments

received regarding our proposed notice.

Final Methodology for Implementation of the Statutory General Funding

Preference

Definition of ``High Rate''

``High rate'' is defined as a minimum percent of graduates in

academic year 1991-92 or academic year 1992-93, whichever is greater,

who spend at least 50 percent of their worktime in clinical practice in

the specified settings. For undergraduate medical education programs

academic years 1988-89 and 1989-90 will be used. Preventive medicine,

public health, dental public health, and public health nurse graduates

can be counted if they identify a primary work affiliation at one of

the qualified work sites. Graduates who are providing care in a

medically underserved community as a part of a fellowship or other

educational experience can be counted.

Definition of ``Significant Increase in the Rate''

``Significant increase in the rate'' means that, between academic

years 1991-92 and 1992-93, the rate of placing graduates in the

specified settings has increased by a minimum percent and that not less

than 15 percent of graduates from the most recent year are working in

these settings.

New Programs

A new program is defined as any program which has graduated less

than three classes. After a program has graduated three classes, that

program will be able to provide the information necessary for the

general funding preference as defined in the law and will no longer be

considered a new program.

A new program will qualify for the general funding preference if

four or more of the following criteria are met:

1. The mission statement of the program identifies a specific

purpose of preparing health professionals to serve underserved

populations.

2. The curriculum includes content which will help to prepare

practitioners to serve underserved populations.

3. Substantial clinical training experience is required in

medically underserved communities.

4. A minimum of 20 percent of the faculty spend at least 50 percent

of their time providing/supervising care in medically underserved

communities.

5. The entire program or a substantial portion of the program is

physically located in a medically underserved community.

6. Student assistance, which is linked to service in medically

underserved communities following graduation, is available to the

students in the program.

7. The program provides a placement mechanism for deploying

graduates to medically underserved communities.

In FY 1994, new programs can qualify for the general preference by

providing assurance that a minimum percent of their prospective

graduates have signed commitments to practice in medically underserved

communities after graduation contingent to receiving some type of

student assistance. This minimum percent will be equal to the minimum

percentage for ``high rate.''

Small Programs

For FY 1994, the program materials for grant programs whose

applicants typically have less than 10 graduates per year will request

data for the preceding three years which will be aggregated to

determine whether or not the ``high rate'' has been achieved.

Service in ``Medically Underserved Community Work Settings''

For implementation of this general funding preference in FY 1994,

it is proposed that service in a ``medically underserved community''

will include service in the following work settings:

Community Health Centers (section 330)

Migrant Health Centers (section 329)

Health Care for the Homeless Grantees (section 340)

Public Housing Primary Care Grantees (section 340A)

Rural Health Clinics, federally designated (section 1861(aa)(2) of the

Social Security Act)

National Health Service Corps sites, freestanding (section 333)

Indian Health Service Sites (Public Law 93-638 for tribally operated

sites and Public Law 94-437 for IHS operated sites)

Federally Qualified Health Centers (section 1905 (a) and (l) of the

Social Security Act)

Primary Medical Care Health Professional Shortage Areas (HPSAs)

(facilities and geographic) (designated under section 332) For primary

care physicians and other health personnel except dentists and nurses

Dental HPSAs (facilities and geographic) (designated under section 332)

For dentists only

Nurse Shortage Areas (old section 836, currently section 846) For

nurses only

State or Local Health Departments (Regardless of sponsor--for example,

local health departments who are funded by the State would qualify.)

Ambulatory practice sites designated by State Governors as serving

medically underserved communities

Dated: March 28, 1994.

John H. Kelso,

Acting Administrator.

[FR Doc. 94-7876 Filed 4-1-94; 8:45 am]

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