National Institutes of Health Clinical Research Loan Repayment Program for Individuals from Disadvantaged Backgrounds

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Public Health Service

42 CFR Part 68a

RIN 0925-AA09

National Institutes of Health Clinical Research Loan Repayment

Program for Individuals from Disadvantaged Backgrounds

AGENCY: National Institutes of Health, HHS.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The National Institutes of Health (NIH) is issuing regulations

to implement provisions of the Public Health Service Act authorizing

the NIH Clinical Research Loan Repayment Program for Individuals from

Disadvantaged Backgrounds. The purpose of the program is the

recruitment and retention of highly qualified health professionals, who

are from disadvantaged backgrounds, to conduct clinical research as

employees of the NIH by providing repayment of qualified educational

loans.

EFFECTIVE DATE: This final rule is effective on November 30, 1998.

FOR FURTHER INFORMATION CONTACT: Jerry Moore, NIH Regulations Officer,

Office of Management Assessment, 6011 Executive Blvd., Suite 601, MSC

7669, Rockville, MD 20852; telephone 301-496-4607 (not a toll-free

number); Fax 301-402-0169; or E-mail ([email protected]). For program

information contact: Marc S. Horowitz, telephone 301-402-5666 (not a

toll-free number).

SUPPLEMENTARY INFORMATION: The NIH Revitalization Act of 1993 (Pub. L.

103-43) was enacted June 10, 1993, adding section 487E of the Public

Health Service (PHS) Act, 42 U.S.C. 288-5. Section 487E authorizes the

Secretary to carry out a program of entering into contracts with

appropriately qualified health professionals from disadvantaged

backgrounds with substantial educational loan debt relative to income.

Under such contracts, qualified health professionals agree to conduct

clinical research as NIH employees for a minimum of two years, in

consideration of the Federal Government agreeing to repay a maximum of

$20,000 annually of the principal and the interest of the educational

loans of such health professionals. This program is known as the NIH

Clinical Research Loan Repayment Program for Individuals from

Disadvantaged Backgrounds. The NIH is amending title 42 of the Code of

Federal Regulations by adding a new part 68a to govern the

administration of this loan repayment program.

The regulations specify the scope and purpose of the program, who

is eligible to apply, how individuals apply to participate in the

program, how participants are selected, and the terms and conditions of

the program.

The NIH announced its plans to issue the regulations in a notice of

proposed rulemaking (NPRM) published in the Federal Register, February

10, 1997 (62 FR 5953). The NPRM provided for a 60-day comment period.

The NIH received no comments. Consequently, the final regulations are

the same as those originally proposed in February 1997, except for an

editorial change reflecting the NIH Medical Board's change of name to

the ``Medical Executive Committee.''

The following is provided as public information.

Executive Order 12866

Executive Order 12866 requires that all regulatory actions reflect

consideration of the costs and benefits they generate, and that they

meet certain standards, such as avoiding the imposition of unnecessary

burdens on the affected public. If a regulatory action is deemed to

fall within the scope of the definition of the term ``significant

regulatory action'' contained in section 3(f) of the Order, pre-

publication review by the Office of Management and Budget's Office of

Information and Regulatory Affairs (OIRA) is necessary. This final rule

has been reviewed under Executive Order 12866 by OIRA and has been

deemed not significant.

Regulatory Flexibility Act

The Regulatory Flexibility Act requires that regulatory actions be

analyzed to determine whether they create a significant impact on a

substantial number of small entities. I certify that this final rule

will not have any such impact.

Paperwork Reduction Act

This final rule does not contain any information collection

requirements which are subject to Office of Management and Budget (OMB)

approval under the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter

35). The application forms used by the NIH Clinical Research Loan

Repayment Program for Individuals from Disadvantaged Backgrounds have

been reviewed and approved by OMB under OMB No. 0925-0361 (expires

September 30, 1998).

Catalog of Federal Domestic Assistance

The Catalog of Federal Domestic Assistance numbered program

affected by the proposed regulation is:

93.220--NIH Clinical Research Loan Repayment Program for

Individuals from Disadvantaged Backgrounds

List of Subjects in 42 CFR Part 68a

Health--clinical research, medical research; Loan programs--health.

Dated: September 18, 1998.

Harold Varmus,

Director, National Institutes of Health.

For the reasons presented in the preamble, title 42 of the Code of

Federal Regulations is amended by adding a new part 68a to read as set

forth below.

PART 68a--NATIONAL INSTITUTES OF HEALTH (NIH) CLINICAL RESEARCH

LOAN REPAYMENT PROGRAM FOR INDIVIDUALS FROM DISADVANTAGED

BACKGROUNDS (CR-LRP)

Sec.

68a.1 What is the scope and purpose of the NIH Clinical Research

Loan Repayment Program for Individuals from Disadvantaged

Backgrounds (CR-LRP)?

68a.2 Definitions.

68a.3 Who is eligible to apply?

68a.4 Who is eligible to participate?

68a.5 Who is ineligible to participate?

68a.6 How do individuals apply to participate in the CR-LRP?

68a.7 How are applicants selected to participate in the CR-LRP?

68a.8 What does the CR-LRP provide to participants?

68a.9 What loans qualify for repayment?

68a.10 What does an individual have to do in return for loan

repayments received under the CR-LRP?

[[Page 58313]]

68a.11 How does an individual receive loan repayments beyond the

initial two-year contract?

68a.12 What will happen if an individual does not comply with the

terms and conditions of participation in the CR-LRP?

68a.13 Under what circumstances can the service or payment

obligation be canceled, waived, or suspended?

68a.14 When can a CR-LRP payment obligation be discharged in

bankruptcy?

68a.15 Additional conditions.

68a.16 What other regulations and statutes apply?

Authority: 42 U.S.C. 288-5.

Sec. 68a.1 What is the scope and purpose of the NIH Clinical Research

Loan Repayment Program for Individuals from Disadvantaged Backgrounds

(CR-LRP)?

This part applies to the award of educational loan payments under

the NIH Clinical Research Loan Repayment Program for Individuals from

Disadvantaged Backgrounds (CR-LRP) authorized by section 487E of the

Public Health Service Act (42 U.S.C. 288-5). The purpose of this

program is to recruit and retain appropriately qualified health

professionals, who are from disadvantaged backgrounds and have

substantial educational debt relative to income, to conduct clinical

research as NIH employees.

Sec. 68a.2 Definitions.

As used in this part:

Act means the Public Health Service Act, as amended (42 U.S.C. 201

et seq.).

Applicant means an individual who applies to, and meets the

eligibility criteria for the CR-LRP.

Approved clinical research means clinical research approved by the

Clinical Research Loan Repayment Committee.

Clinical privileges means the delineation of privileges for patient

care granted to qualified health professionals by the NIH Medical

Executive Committee or other appropriate credentialing board.

Clinical research means activities which qualify for inclusion as

clinical research in the CR-LRP as determined by the Clinical Research

Loan Repayment Committee.

Clinical Research Loan Repayment Committee (CR-LRC) means the

scientific board assembled to review, rank, and approve or disapprove

Clinical Research Loan Repayment Program applications. The CR-LRC is

composed of NIH scientific staff and co-chaired by the Associate

Director for Clinical Research, NIH, and the Associate Director for

Research on Minority Health, NIH. Members are nominated by the Deputy

Director, Intramural Research, NIH, and the co-chairs, and appointed by

the Director, NIH.

Clinical Research Loan Repayment Program (CR-LRP or Program) means

the NIH Clinical Research Loan Repayment Program for Individuals from

Disadvantaged Backgrounds authorized by section 487E of the Act, as

amended.

Clinical Research Loan Repayment Program (CR-LRP or Program)

contract refers to the agreement, which is signed by an applicant and

the Secretary, wherein the applicant from a disadvantaged background

agrees to engage in clinical research as an employee of the NIH and the

Secretary agrees to repay qualified educational loans for a prescribed

period as specified in this part.

Clinical researcher means an NIH employee with clinical privileges

who is conducting approved clinical research.

Commercial loans means loans made by banks, credit unions, savings

and loan associations, not-for-profit organizations, insurance

companies, schools, and other financial or credit institutions which

are subject to examination and supervision in their capacity as lending

institutions by an agency of the United States or of the State in which

the lender has its principal place of business.

Current payment status means that a qualified educational loan is

not past due in its payment schedule as determined by the lending

institution.

Debt threshold refers to the minimum amount of qualified

educational debt an individual must have, on his/her program

eligibility date, in order to be eligible for Program benefits and, for

purposes of eligibility under this part, debt threshold means that the

qualified educational debt must equal or exceed 20 percent of an

individual's annual NIH salary on his/her program eligibility date.

Educational expenses means the cost of the health professional's

education, including the tuition expenses and other educational

expenses such as fees, books, supplies, educational equipment and

materials, and laboratory expenses.

Government loans means loans made by Federal, State, county, or

city agencies which are authorized by law to make such loans.

Individual from disadvantaged background means an individual who:

(1) Comes from an environment that inhibited the individual from

obtaining the knowledge, skill and ability required to enroll in and

graduate from a health professions school; or

(2) Comes from a family with an annual income below a level based

on low-income thresholds according to family size published by the U.S.

Bureau of the Census, adjusted annually for changes in the Consumer

Price Index, and adjusted by the Secretary for use in all health

professions programs. The Secretary periodically publishes these income

levels in the Federal Register.

Institute, Center, or Agency (ICA) means an institute, center, or

agency of the National Institutes of Health.

Living expenses means the reasonable cost of room and board,

transportation and commuting costs, and other reasonable costs incurred

during an individual's attendance at an educational institution.

Participant means an individual whose application to the CR-LRP has

been approved and whose Program contract has been executed by the

Secretary.

Program means the NIH Clinical Research Loan Repayment Program for

Individuals from Disadvantaged Backgrounds.

Program eligibility date means the date on which an individual's

Program contract is executed by the Secretary and that individual is

engaged in approved clinical research as an employee of the NIH.

Qualified educational loans and interest/debt include Government

and commercial educational loans and interest for:

(1) Undergraduate, graduate, and health professional school tuition

expenses;

(2) Other reasonable educational expenses required by the school(s)

attended, including fees, books, supplies, educational equipment and

materials, and laboratory expenses; and (3) reasonable living expenses,

including the cost of room and board, transportation and commuting

costs, and other reasonable living expenses incurred.

Reasonable educational and living expenses means those educational

and living expenses which are equal to or less than the sum of the

school's estimated standard student budget for educational and living

expenses for the degree program and for the year(s) during which the

participant was enrolled in school. If there is no standard budget

available from the school or if the participant requests repayment for

educational and living expenses which exceed the standard student

budget, reasonableness of educational and living expenses incurred must

be substantiated by additional contemporaneous documentation, as

determined by the Secretary.

[[Page 58314]]

Repayable debt means the portion, as established by the Secretary,

of an individual's total qualified educational debt relative to the NIH

salary, which can be paid by the CR-LRP. Specifically, qualifying

educational debt amounts in excess of 50 percent of the debt threshold

will be considered for repayment.

Salary means base pay plus quarters, subsistence, and variable

housing allowances, if applicable.

School means undergraduate, graduate, and health professions

schools which are accredited by a body or bodies recognized for

accreditation purposes by the Secretary of Education.

Secretary means the Secretary of Health and Human Services and any

other officer or employee of the Department of Health and Human

Services to whom the authority involved has been delegated.

Service means the Public Health Service.

State means one of the fifty States, the District of Columbia, the

Commonwealth of Puerto Rico, the Northern Mariana Islands, the U.S.

Virgin Islands, Guam, American Samoa, and the Trust Territory of the

Pacific Islands (the Federated States of Micronesia, the Republic of

the Marshall Islands, and the Republic of Palau).

Withdrawal means a request by a participant, prior to the Program

making payments on his or her behalf, for withdrawal from Program

participation. A withdrawal is without penalty to the participant and

without obligation to the Program.

Sec. 68a.3 Who is eligible to apply?

To be eligible to apply to the CR-LRP, an individual must be a

citizen, national, or permanent resident of the United States; hold a

M.D., Ph.D., D.O., D.D.S., D.M.D., A.D.N./B.S.N., or equivalent degree;

have, on his/her program eligibility date, qualified educational debt

equal to or in excess of the debt threshold; and be an individual from

a disadvantaged background.

Sec. 68a.4 Who is eligible to participate?

To be eligible to participate in the CR-LRP, an applicant must have

the recommendation of the employing ICA Scientific Program Director,

the concurrence of the employing ICA Director, and the approval of the

CR-LRC. Since participation in the Program is contingent, in part, upon

employment with NIH, a Program contract may not be awarded to an

applicant until an employment commitment has been made by the employing

ICA Personnel Department.

Sec. 68a.5 Who is ineligible to participate?

The following individuals are ineligible for CR-LRP participation:

(a) Persons who are not eligible applicants as specified under

section 68a.3;

(b) Persons who owe an obligation of health professional service to

the Federal Government, a State, or other entity, unless a deferral is

granted for the length of his/her service obligation under the CR-LRP.

The following are examples of programs which have a service obligation:

Physicians Shortage Area Scholarship Program, National Research Service

Award Program, Public Health Service Scholarship, National Health

Service Corps Scholarship Program, Armed Forces (Army, Navy, or Air

Force) Professions Scholarship Program, Indian Health Service

Scholarship Program, and the NIH AIDS Research Loan Repayment Program.

(c) Persons who are not NIH employees, such as Intramural Research

Training Award (IRTA) recipients, Visiting Fellows, National Research

Service Award (NRSA) recipients, Guest Researchers or Special

Volunteers, NIH-National Research Council (NRC) Biotechnology Research

Associates Program participants, and Intergovernmental Personnel Act

(IPA) participants; or

(d) Persons who do not have clinical privileges.

Sec. 68a.6 How do individuals apply to participate in the CR-LRP?

An application for participation in the CR-LRP shall be submitted

to the NIH office which is responsible for the Program's

administration, in such form and manner as the Secretary may prescribe.

Sec. 68a.7 How are applicants selected to participate in the CR-LRP?

To be selected for participation in the CR-LRP, applicants must

satisfy the following requirements:

(a) Applicants must meet the eligibility requirements specified in

Sec. 68a.3 and Sec. 68a.4.

(b) Applicants must not be ineligible for participation as

specified in Sec. 68a.5.

(c) Applicants must be selected for approval by the CR-LRC, based

upon a review of their applications.

Sec. 68a.8 What does the CR-LRP provide to participants?

(a) Loan repayments: For each year of service the individual agrees

to serve, with a minimum of 2 years of obligated service, the Secretary

may pay up to $20,000 per year of a participant's repayable debt.

(b) Under Sec. 68a.8(a), the Secretary will make payments in the

discharge of debt to the extent appropriated funds are available for

these purposes.

Sec. 68a.9 What loans qualify for repayment?

(a) The CR-LRP will repay participants' lenders the principal,

interest, and related expenses of qualified Government and commercial

educational loans obtained by participants for the following:

(1) Undergraduate, graduate, and health professional school tuition

expenses;

(2) Other reasonable educational expenses required by the school(s)

attended, including fees, books, supplies, educational equipment and

materials, and laboratory expenses; and

(3) Reasonable living expenses, including the cost of room and

board, transportation and commuting costs, and other living expenses as

determined by the Secretary.

(b) The following educational loans are ineligible for repayment

under the CR-LRP:

(1) Loans obtained from other than a government entity or

commercial lending institution;

(2) Loans for which contemporaneous documentation is not available;

(3) Loans or portions of loans obtained for educational or living

expenses which exceed the standard of reasonableness as determined by

the participant's standard school budget for the year in which the loan

was made, and are not determined by the Secretary to be reasonable

based on additional documentation provided by the individual;

(4) Loans, financial debts, or service obligations incurred under

the following programs: Physicians Shortage Area Scholarship Program

(Federal or State), National Research Service Award Program, Public

Health and National Health Service Corps Scholarship Training Program,

National Health Service Corps Scholarship Program, Armed Forces (Army,

Navy, or Air Force) Health Professions Scholarship Program, Indian

Health Service Program, and similar programs, upon determination by the

Secretary, which provide loans, scholarships, loan repayments, or other

awards in exchange for a future service obligation;

(5) Any loan in default or not in a current payment status;

(6) Loan amounts which participants have paid or were due to have

paid prior to the program eligibility date; and

(7) Loans for which promissory notes have been signed after the

program eligibility date.

[[Page 58315]]

Sec. 68a.10 What does an individual have to do in return for loan

repayments received under the CR-LRP?

Individuals must agree to be engaged in approved clinical research,

as employees of the NIH, for a minimum initial period of two

consecutive years.

Sec. 68a.11 How does an individual receive loan repayments beyond the

initial two-year contract?

An individual may apply for and the Secretary may grant extension

contracts for one-year periods, if there is sufficient debt remaining

to be repaid and the individual is engaged in approved clinical

research as an NIH employee.

Sec. 68a.12 What will happen if an individual does not comply with the

terms and conditions of participation in the CR-LRP?

(a) Absent withdrawal (see Sec. 68a.2) or termination under

paragraph (d) of this section, any participant who fails to complete

the minimum two-year service obligation required under the Program

contract will be considered to have breached the contract and will be

subject to assessment of monetary damages and penalties as follows:

(1) Participants who leave during the first year of the initial

contract are liable for amounts already paid by the NIH on behalf of

the participant plus an amount equal to $1,000 multiplied by the number

of months of the original service obligation.

(2) Participants who leave during the second year of the contract

are liable for amounts already paid by the NIH on behalf of the

participant plus $1,000 for each unserved month.

(b) Payments of any amount owed under paragraph (a) of this section

shall be made within one year of the participant's breach (or such

longer period as determined by the Secretary).

(c) Participants who sign a continuation contract for any year

beyond the initial two-year period and fail to complete the one-year

period specified are liable for the pro rata amount of any benefits

advanced beyond the period of completed service.

(d) Terminations will not be considered a breach of contract in

cases where such terminations are beyond the control of the participant

as follows:

(1) Terminations for cause or for convenience of the Government

will not be considered a breach of contract and monetary damages will

not be assessed.

(2) Occasionally, a participant's research assignment may evolve

and change to the extent that the individual is no longer engaged in

approved clinical research. Similarly, the research needs and

priorities of the ICA and/or the NIH may change to the extent that a

determination is made that the health professional's skills may be

better utilized in a non-clinical research assignment. Under these

circumstances, the following will apply:

(i) Program participation and benefits will cease as of the date an

individual is no longer engaged in approved clinical research; and

(ii) Normally, job changes of this nature will not be considered a

breach of contract on the part of either the NIH or the participant.

Based on the recommendation of the ICA Director and concurrence of the

Secretary, the participant will be released from the remainder of his

or her service obligation without assessment of monetary penalties. The

participant in this case will be permitted to retain all Program

benefits made or owed by NIH on his/her behalf up to the date the

individual is no longer engaged in approved clinical research, except

the pro rata amount of any benefits advanced beyond the period of

completed service.

Sec. 68a.13 Under what circumstances can the service or payment

obligation be canceled, waived, or suspended?

(a) Any obligation of a participant for service or payment to the

Federal Government under this part will be canceled upon the death of

the participant.

(b) The Secretary may waive or suspend any service or payment

obligation incurred by the participant upon request whenever compliance

by the participant:

(1) Is impossible,

(2) Would involve extreme hardship to the participant, or

(3) If enforcement of the service or payment obligation would be

against equity and good conscience.

(4) The Secretary may approve a request for a suspension of the

service or payment obligations for a period of 1 year. A renewal of

this suspension may also be granted.

(c) Compliance by a participant with a service or payment

obligation will be considered impossible if the Secretary determines,

on the basis of such information and documentation as may be required,

that the participant suffers from a physical or mental disability

resulting in the permanent inability of the participant to perform the

service or other activities which would be necessary to comply with the

obligation.

(d) In determining whether to waive or suspend any or all of the

service or payment obligations of a participant as imposing an undue

hardship and being against equity and good conscience, the Secretary,

on the basis of such information and documentation as may be required,

will consider:

(1) The participant's present financial resources and obligations;

(2) The participant's estimated future financial resources and

obligations; and

(3) The extent to which the participant has problems of a personal

nature, such as a physical or mental disability or terminal illness in

the immediate family, which so intrude on the participant's present and

future ability to perform as to raise a presumption that the individual

will be unable to perform the obligation incurred.

Sec. 68a.14 When can a CR-LRP payment obligation be discharged in

bankruptcy?

Any payment obligation incurred under Sec. 68a.12 may be discharged

in bankruptcy under Title 11 of the United States Code only if such

discharge is granted after the expiration of the five-year period

beginning on the first date that payment is required and only if the

bankruptcy court finds that a nondischarge of the obligation would be

unconscionable.

Sec. 68a.15 Additional conditions.

When a shortage of funds exists, participants may be funded

partially, as determined by the Secretary. However, once a CR-LRP

contract has been signed by both parties, the Secretary will obligate

such funds as necessary to ensure that sufficient funds will be

available to pay benefits for the duration of the period of obligated

service unless, by mutual written agreement between the Secretary and

the applicant, specified otherwise. Benefits will be paid on a

quarterly basis after each service period unless specified otherwise by

mutual written agreement between the Secretary and the applicant. The

Secretary may impose additional conditions as deemed necessary.

Sec. 68a.16 What other regulations and statutes apply?

Several other regulations and statutes apply to this part. These

include, but are not necessarily limited to:

Debt Collection Act of 1982, Pub. L. 97-365 (5 U.S.C. 5514);

Fair Credit Reporting Act (15 U.S.C. 1681 et seq.);

Federal Debt Collection Procedures Act of 1990, Pub. L. 101-647

(28 U.S.C. 1); and Privacy Act of 1974 (5 U.S.C. 552a).

[FR Doc. 98-29130 Filed 10-29-98; 8:45 am]

BILLING CODE 4140-01-P