No. 2001-77 - Pennsylvania Session Laws > Home Page

SESSIONOF 2001 Act 2001-77 755

No. 2001-77

AN ACT

HB 2

Establishing a specialfund and account for money receivedby theCommonwealthfrom the Master Settlement Agreement with tobaccomanufacturers; providingfor home and community-based care, for tobacco useprevention andcessationefforts, for Commonwealth universal research enhancement, for hospitaluncompensatedcare, for health investment insurance, for medicalassistanceforworkers with disabilities, for regional biotechnology research centers, for theHealthLinkProgram,for community-basedhealth careassistanceprograms,forPACE reinstatement and PACENET expansion, for medical education loanassistanceandfor percentageallocation and appropriation ofmoneys.

TABLE OFCONTENTS

Chapter 1. Preliminary Provisions

Section101. Shorttitle.Section 102. Definitions.

Chapter 3. HealthInvestment

Section301. Scope.Section302. Definitions.Section 303. Establishmentof specialfundandaccount.Section304. TobaccoSettlementInvestmentBoard.Section305. Investmentof fund andaccounts.Section306. Useof TobaccoSettlementFund.Section 307. Useof HealthAccount.Section308. Annualreport.

Chapter 5. Home andCommunity-BasedCare

Section501. Scope.Section502. Definitions.Section 503. Homeand community-basedcareservices.Section 504. Accountability.

Chapter 7. TobaccoUsePrevention andCessationEfforts

Section701. Scope.Section702. Definitions.Section703. Tobaccouseprevention andcessationprogram.Section704. Powersand duties of department.Section 705. Committee.Section706. Primary contractors.Section707. Serviceproviders.Section708. Contracts andpurposes.Section709. Accountability.

756 Act 2001-77 LAWS OF PENNSYLVANIA

Section710. Miscellaneousprovisions.

Chapter9. CommonwealthUniversalResearchEnhancement

Section901. Scope.Section902. Definitions.Section903. Healthresearchprogram.Section904. Departmentresponsibilities.Section905. Peerreviewprocedures.Section906. Useoffunds.Section907. Applications.Section908. NationalInstitutesof Health fundingformula.Section909. NationalCancerInstitutefunding formula.Section910. Accountabilityprocedures.

Chapter11. HospitalUncompensatedCare

Section1101. Scope.Section1102. Definitions.Section 1103. Hospitaluncompensatedcarepayments.Section1104. Eligibility andpayment.Section 1105. Reimbursementfor extraordinaryexpense.Section1106. Amounts.Section1107. Federalfunds.Section1108. Penalties.

Chapter13. HealthInvestmentInsurance

Section1301. Scope.Section1302. Definitions.Section1303. Adult basiccoverageinsuranceprogram.Section1304. Accountability.

Chapter15. MedicalAssistancefor Workerswith Disabilities

Section 1501. Scope.Section 1502. Definitions.Section1503. Medical assistancebenefitsfor workers with disabilities and

workers with medicallyimproveddisabilities.

Chapter17. RegionalBiotechnologyResearchCenters

Section1701. Scope.Section 1702. Defmitions.Section 1703. Regionalbiotechnologyresearchcenters.Section 1704. Applicability of standardsregardingfundedresearch.

Chapter 19. HealthLink

Section 1901. Scope.Section 1902. Defmitions.


Section 1903. HealthLinkProgram.Section 1904. Duties.

Chapter 21. Community-BasedHealth CareAssistance

Section2101. Scope.Section2102. Definitions.Section2103. Community-BasedHealthCareAssistanceProgram.

Chapter23. PACEReinstatementandPACENETExpansion

Section2301. Scope.Section2302. Definitions.Section2303. Additional eligibility.Section2304. Deductiblesand copayments.Section2305. ApplicationofotherPACENETprovisions.Section2306. PACEreinstatement.Section2307. Limitations.Section2308. PACE study.

Chapter25. PennsylvaniaMedicalEducationLoan Assistance

Section2501. Scope.Section2502. Definitions.Section2503. PennsylvaniaMedical EducationLoan AssistanceProgram.Section2504. Loanguarantorprogram.Section2505. Loanforgivenessprogram.Section2506. Limitations.Section2507. Regulations.

Chapter27. MiscellaneousProvisions

Section2701. Definitions.Section2702. Disbursementto counties.Section2703. Prohibition.

Chapter51. Appropriations

Section5101. One-timeappropriationsfor 2001-2002.Section5102. Sunset.Section5103. Effectivedate.

The GeneralAssembly of the Commonwealthof Pennsylvaniaherebyenactsas follows:

CHAPTER 1PRELIMINARY PROVISIONS

Section101. Shorttitle.Thisactshallbeknown andmaybecitedas theTobaccoSettlementAct.


Section102. Definitions.The following wordsandphraseswhenused in this act shall havethe

meaningsgiven to them in this sectionunlessthe contextclearly indicatesotherwise:

‘Fund.” TheTobaccoSettlementFundestablishedin section303(a).‘Health Account.” The Health EndowmentAccount for Long-Term

Hopeestablishedin section303(b).“Health Venture InvestmentAccount.” The account establishedin

section303(c).“Jurisdictional payment.” A paymentreceivedby the Commonwealth

resulting from a court retainingjurisdiction over the EscrowAgreementpursuanttosectionIX(b) of theMasterSettlementAgreement.

“MasterSettlementAgreement.” Thesettlementagreementandrelateddocumentsenteredinto on November23, 1998,by the CommonwealthandleadingUnitedStatestobaccoproductmanufacturersapprovedby theCourtof CommonPleas,PhiladelphiaCounty,on January13, 1999.

“Strategic contribution payment.” A payment received by theCommonwealth pursuant to section IX(c)(2) of the Master SettlementAgreement.

“TobaccoSettlementFund.” TheTobaccoSettlementFundestablishedin section303(a).

CHAPTER3HEALTH INVESTMENT

Section301. Scope.Thischapterdealswithhealth investment.

Section302. Definitions.Thefollowing wordsandphraseswhenusedin this chaptershall have

the meanings given to them in this section unless the context clearlyindicatesotherwise:

“Accounts.” The Health EndowmentAccount for Long-Term Hopeestablishedin section303(b) andthe HealthVenture InvestmentAccountestablishedin section303(c).

“Board.” The Tobacco Settlement InvestmentBoard establishedinsection304(a).Section303. Establishmentof specialfund andaccount.

(a) TobaccoSettlementFund.—Thereis herebyestablisheda specialfund known as the TobaccoSettlementFund. Except as provided insubsection(b), all paymentsreceivedby theCommonwealthpursuantto theMaster Settlement Agreement shall be deposited by the TreasuryDepartmentin thefund.

(b) Health Account.—Thereis herebyestablishedwithin the fund theHealthEndowmentAccount for Long-TermHope. Thefollowing amountsshallbedepositedby theTreasuryDepartmentinto theaccount:


(1) The jurisdictional payment received by the Commonwealthpursuant to theMaster Settlement Agreement.

(2) The strategic contribution payments received by theCommonwealthpursuantto theMaster SettlementAgreement.

(3) Earningsderived from the investmentof the money in the fundafter deduction of investment expenses,including such earningsasmayhave accruedprior to the effective date of this chapter.

(4) Earningsderivedfrom the investmentof the money in the HealthAccount after deduction of investment expensesand the approvedexpensesof theboard.

(5) Money received as a result of investments from the HealthVentureInvestmentAccount.(c) Health Venture Investment Account.—There is hereby established

Within the fund theHealthVenture InvestmentAccount.Section304. TobaccoSettlementInvestmentBoard.

(a) Establishment.—Thereis herebyestablishedtheTobaccoSettlementInvestment Board, consisting of II membersas follows: the Governor or adesignee;theSecretaryof the Budget; theStateTreasureror adesignee;onememberappointedby the President pro tempore of the Senateand onememberappointed by the Minority Leaderof the Senate; one memberappointedby the Speakerof the House of Representativesandonememberappointedby the Minority Leaderof the House of Representatives; threemembers appointed by the Governor; and one member appointed by theStateTreasurer. Legislative appointmentsshall serveat thepleasureof theappointing authority.Other appointedmembersshall serve for a term offour yearsanduntil a successoris appointed. Members of the boardshallserve without compensation but shall be reimbursed for actual andreasonableexpensesincurredin the performance of their official duties. TheGovernor shall selectonemember aschairperson,and themembersof theboardshallselectonemember assecretary.

(b) Professional personnel.—Theboard may employ investmentadvisors,fund managersandstaffastheboarddeemsadvisable.

(c) Expenses.—All approved expensesof the board and relatedprofessionalpersonnelexpensesshall be paidanddeductedfrom investmentearningsof the Health Account. The board shall, throughthe Governor,submit to the GeneralAssemblyan annualbudget covering its proposedadministrativeexpenses.Concurrently with its annualbudget request, theboardshall submit to theGeneralAssemblyalist of proposedexpendituresfor the period coveredby the budget request that the board intendsto paythrough the use of directed commissions,together with a list of the actualexpendituresfrom the previous yearactually paid by the boardthroughtheuse of directed commissions.All such directedcommissionexpendituresshall be made by the board for the exclusivebenefit of the fund and theHealthAccount.


(d) Records and meetings.—Theboard shall keepa record of itsproceedings,which shall be opento inspectionby thepublic. Meetingsofthe board shall be conductedunder 65 Pa.C.S.Ch. 7 (relating to openmeetings).Section305. Investmentof fund andaccounts.

(a) Controlandmanagement.—Notwithstandinganyotherprovisionoflaw, the boardshallhaveexclusivecontrolandauthorityto manage,investandreinvestmoneyin thefund andthe HealthAccountin accordancewiththis section,subject,however,to the exerciseof that degreeof judgment,skill and care under the circumstancesthen prevailing that personsofprudence,discretion and intelligence,who are familiar with investmentmatters,exercisein the managementof their ownaffairs,not in regard tospeculationbut in regardto permanentdispositionof the funds,consideringthe probableincometo be derived from the investmentsandthe probablesafetyof their capital. The board may hold, purchase,sell, lend, assign,transfer or disposeof any securitiesand investments,including equitysecurities,in which moneyin the fund or the accountshas beeninvestedandof theproceedsof theinvestments,including anydirectedcommissionsthathaveaccruedto the benefitof thefund or theaccountsasaconsequenceof the investments,and of moneybelonging to the fund or the accountssubjecttothe standardof prudencein this section.

(b) Fiduciary status of board.—Themembersof the board andtheirprofessional personnelshall stand in a fiduciary relationship to theCommonwealthandits citizensregardingthe investmentsof the moneyofthe fund andthe accountsandshall not profit, either directly or indirectly,with respectthereto.

(c) Custodian.—TheStateTreasurershallbe the custodianof the fundandthe accounts.All investmentdrawsfrom the fund or the accountsshallbe made by the State Treasurerin accordancewith requisitionssignedbythesecretaryof theboardandratifiedby resolutionof theboard..

(d) Authorized investmentvehicles for the fund and the HealthAccount—Theboard may invest the money in the fund and the HealthAccount in investments that meet the standardof prudenceset forth insubsection(a) by acquiring any type of interestin a businessorganizationexistingunderthe laws of anyjurisdiction.The liability of the fund or theHealthAccount shallbelimitedto theamountof their investmentunder thissubsection.

(e) Additional authorized investment vehicles for the HealthAccount—Theboardin its prudentdiscretionmay investthe moneyin theHealth Account in venture capital investments, private placementinvestmentsor other alternative investments of any kind, structure ormannerwhich meetthe standardof prudence setforth in subsection(a). Theliability of the Health Account shall be limited to the amount of itsinvestmentunderthis subsection.


(1) Authorizedinvestmentvehicles for the Health VentureInvestmentAccount.—Theboard may invest the money in the Health VentureInvestmentAccountin investmentswhichmeetthestandardof prudencesetforth in subsection(a) by becominga limited partnerin partnershipsthatmake venturecapital investmentsby acquiring equity interests or acombinationof debtand equity interestsin healthcare, biotechnologyorany otherhealth-relatedbusinessesthat areexpectedto grow substantiallyin the future andin which the expectedreturnson investmentareto comepredominantlyfrom increasesin value of the equity interestsandare notinterestsin or securedby real estate.Theboardmay investin oneor morelimited partnershipsor comparableinvestmententitiesprovided that theinvestmentguidelinesandstrategiesof eachinvestmententity requirethatatleast70% of theinvestmentswill bemadein companieslocatedprimarilyin Pennsylvania or in companieswilling to relocatesignificant businessoperationsto Pennsylvania.The liability of the fund or the HealthVentureInvestment Account shall be limited to the amountof its investmentunderthissection.

(g) Requirements for venture capital investments.—Thefollowing arethe requirements to participate in a venture capital investment programundertakenby the boardundersubsection(e) or (1):

(1) Each generalpartner must:(i) contribute 2% of the aggregatecommitteecapital asa general

partner;and(ii) subordinate5% of the board’scontribution in terms of the

distribution schedule, putting the general partner in a first losspositionwith respectto the board.(2) The partnership must provide a preferred return of no lessthan

5% to all limited partners.(3) The partnershipmustagreeto operateundera prudentexpert

standardof care.Theboardshall adopt policiesregarding cancellationofa contract with a general partnerbasedon poorperformancewhich mayinclude policies relating to multiple instancesof indemnification orsubstantial changesin principals.

(4) The board must be given a seat on any limited partneradvisory/valuationcommittee.

(5) Theboardmustbereimbursedfor expensesfor attendinglimitedpartneradvisory/valuationcommitteemeetingsandpartnershipannualmeetings.

(6) The partnership must issue to the board audited financialstatementson the basisof GenerallyAcceptedAccountingPrinciples.(h) Legislative declaration.—The General Assembly finds and declares

that authorized investments of the fund or the accounts made by or onbehalfof the boardunder this sectionwherebythe boardbecomesajointowner, limited partner or stockholder in a company, corporation, limitedpartnership,associationor other lawful businessorganization areoutside


the scopeof theoriginal intentof anddonot violatetheprohibitionset forthin section8 of Article VIII of theConstitutionof Pennsylvania.Section306. UseofTobaccoSettlementFund.

(a) Annual report.—TheGovernor shall report on the fund in theannual budget which shall include the amountsappropriatedto eachprogram.

(b) Appropriations.—(1) The GeneralAssemblyherebyappropriatesfunds in the fund in

accordancewith the following percentagesbased on actual fundsreceivedin eachyearor uponreceiptofthe final annualpayment:

(i) Eightpercentfor depositinto the Health Account pursuanttothischapter,whichshallbedepositedimmediatelyuponreceipt.

(ii) Thirteen percent for home and community-basedservicespursuantto Chapter5. For fiscal year2001-2002,up to $13.5millionmaybe usedfor expandedcounseling,areaagencyon aging trainingandeducation,assistivetechnologyandfor reducingwaiting lists forservicesin theDepartmentof Aging.

(iii) Twelve percentfor tobacco use preventionand cessationprogramspursuantto Chapter7.

(iv) Eighteenpercentfor healthandrelatedresearchpursuanttosection906 andonepercentfor healthandrelatedresearchpursuantto section909.

(v) Ten percentfor the uncompensatedcare paymentprogrampursuanttoChapter11.

(vi) Thirty percentfor health investmentinsurancepursuanttoChapter13 andfor thepurchaseof Medicaidbenefitsfor workerswithdisabilitiespursuantto Chapter15.

(vii) Eight percentfor the expansionof the PACENETprogrampursuanttoChapter23.(2) In addition,anyFederalfundsreceivedfor anyof theseprograms

isherebyspecificallyappropriatedto thoseprograms.(c) Lapses.—Lapsesshall bedepositedin theHealth Accountexceptfor

thefollowing:(1) Lapsesfrom moneysprovidedfor thehomeandconununity-based

careservicesshallbereallocatedto thehomeandcommunity-basedcareprogramfor usein succeedingyears.

(2) Lapsesfrom moneysprovidedfor thehealthinvestmentinsuranceprogramshallbereallocatedto thehealthinvestmentinsuranceprogramfor usein succeedingyears.

Section307. Use of HealthAccount.Wheneverthe Governordeterminesthatmoneyfrom theHealthAccount

isnecessarytomeetthe extraordinaryor emergencyhealthcare-needs-of-thecitizens of this Commonwealth,the Governor shall presenta detailedspendingproposalwith arequestfor an appropriationand anynecessarylegislationto thechairandminoritychairof the AppropriationsCommittee


of the Senate and the chair and minority chair of the AppropriationsCommitteeof the House of Representatives.The General Assemblymay,throughapprovalof aseparateappropriationbill by a voteof two-thirdsofthe memberselectedto the Senateand to the House of Representatives,appropriatemoney from the Health Accountto meettheneedsidentifiedinthe Governor’srequest.Any money appropriated under this section thatlapsesshall be returnedto the HealthAccount.Section308. Annualreport.

By November30,2002,andannuallythereafter,theboardshallsubmitareport to the Governor and to the chair and minority chair of theAppropriations Committeeof the Senateandthe chairand minority chairofthe Appropriations Committee of the House of Representatives.The reportshall provide an analysis of the statusof the current investmentsandtransactionsmadeover the last fiscal yearfor the fund andthe accounts.

CHAFFER5HOME AN]) COMMUNITY-BASED CARE

Section501. Scope.Thischapter dealswith homeand community-basedcare.

Section502. Definitions.The following wordsand phrases when used in this chapter shall have

the meaningsgiven to them in this section unless the context clearlyindicatesotherwise:

“Applicant.” An individual who appliesfor servicesunder this chapterandwhomeetsall of the following:

(1) Legallyresidesin the UnitedStates.(2) Is domiciledin this Commonwealth.(3) Is60yearsof ageor older.

“Assistedindividual.” An applicant who meetsall ofthe following:(1) Is domiciled in this Commonwealthfor at least30 daysprior to

requestinganassessment.(2) Has beenassessedby the department to be in need of care

equivalentto the level of careprovided by anursing facility.(3) Hasmonthlyincomeator below300%of the Federalbenefit rate.(4) Exceeds the resource eligibility requirementsfor medical

assistanceunder theactof June 13, 1967 (P.L.31,No.21),knownas thePublic WelfareCode,but doesnotexceeda resourcelevel determinedbythe departmentandthe Departmentof Public Welfare which in no caseshallbelessthan$40,000.“Department.” TheDepartmentof Aging of theConunonwealth.“Enrolled provider.” A provider who participates in the medical

assistanceprogrampursuantto the actof June 13, 1967 (P.L.31, No.21),knownas thePublic WelfareCode.

“Federalbenefit rate.” The amountpayableto a SupplementalSecurityIncome (SSI) beneficiary under section 1611(b)(1) of the Social Security

764 Act 2001-77 LAWS OF PENNSYLVAMA

Act (49 Stat. 620, 42 U.S.C. § 1382(b)(1))whoresidesin his or her ownhomeandhasno incomeor resources.

“Fundedindividual.” An applicantwhomeetsall of thefollowing:(1) Hasbeenassessedto be in needof careequivalentto the level of

careprovidedbyanursingfacility.(2) Is financially eligible for medicalassistanceundertheactof June

13, 1967 (P.L.31,No.21),known asthe PublicWelfareCode.“Home and community-basedcare services.” An array of services

designatedby the Departmentof Aging and the Departmentof PublicWelfaretomaintainolder Pennsylvaniansin their homes.

“Nursing facility.” A facility which is:(1) licensedunder the actof July 19, 1979 (P.L.130, No.48),known

as theHealthCareFacilitiesAct; and(2) qualified to participateunder Title XIX of the FederalSocial

SecurityAct.Section503. Homeandcommunity-basedcareservices.

(a) Appropriations.—Appropriationsfrom thefund to theDepartmentofPublic Welfarefor homeand community-basedcareservicesshall be usedto pay enrolled providersfor home and community-basedcare servicesprovided to fundedindividuals in accordancewith all applicableFederalarid Staterequirements.Appropriationsfrom the fund to the departmentshall be used for home and conununity-basedcare servicesto assistedindividualsandfor coordinationof servicesprovidedunderthis chapter.

(b) Applicantresponsibilities.—Anapplicantfor homeandcommunity-basedcareservicesshalldoall of thefollowing:

(1) Requestanassessmentin accordancewith proceduresestablishedby the departmentandtheDepartmentof PublicWelfare.

(2) Cooperatewith the Departmentof Public Welfare and thedepartment,as applicable, in determining eligibility for home andcommunity-basedcareservices,includingfmancialeligibility.(c) Fundedindividual responsibilities.—Anapplicant who receives

homeandcommunity-basedcareservicesas afundedindividual-shallnotifrthe Departmentof Public Welfare of anychangein resourcesor incomeasspecifiedby theDepartmentof PublicWelfare.

(d) Assistedindividual responsibilities.—Anapplicant who receiveshomeandcommunity-basedcareservicesas an assistedindividual shall doall of the following:

(1) Paya monthlycopaymenton a sliding scaledevelopedby thedepartmentand the Departmentof Public Welfare basedon resourcesandincome.Themonthlycopaymentshallnot exceedthe actualcostsofthehomeandcommunity-basedcareservicestobereceived.

(2) Notify the departmentof any changein resourcesandmonthlyincomeas specifiedby the department.(e) Departmentof Public Welfareresponsibilities.—TheDepartmentof

PublicWelfare shall doall of the following:


(1) Determinethe financialeligibility of applicants.(2) Providefunding to enrolled providers for home and community-

basedcareservicesto fundedindividuals.(3) Notify the department of applicants determined to be assistedor

fundedindividuals.(4) In cooperation with the department, submit a report no later than

November 30, 2002,andannually thereafter to the chair andminoritychair of the Aging and Youth Committee of the Senate,the chair andminority chair of the Public Health and Welfare Committee of theSenate, the chair and minority chair of the Aging and Older AdultServices Committee of the House of Representatives, the chair andminority chair of the Health and Human Services Committee of theHouse of Representatives, the chair and minority chair of theAppropriations Committee of the Senate and the chair and minoritychair of the Appropriations Committeeof the House of Representatives.The report shall be made available for public inspection and posted onthe publicly accessibleWorld Wide Web siteof the Departmentof PublicWelfare. Thereport shall include:

(i) The numberof applicants.(ii) Thenumberof assistedandfundedindividuals by county.(iii) The total expenditure by county.(iv) The scopeandaverage cost of services provided to assisted

andto fundedindividuals.(v) The average expenditure per assisted and per funded

individual.(vi) Theaveragecopaymentamount perassistedindividual.(vii) Any other information deemednecessaryby the Department

of Public Welfare.(1) Department responsibilities.—The department shall do all of the

following:(1) Coordinate the collectionof copaymentsfrom assistedindividuals

for homeand community-basedcare services.(2) Provide funding to entities designated by the department to

provide homeandcommunity-basedcare servicesto assistedindividuals.(3) Assist the Department of Public Welfare in the recruitment of

providers.(4) Facilitate the transition of assistedindividuals who become

eligible for home and community-basedcare services as fundedindividuals.(g) Limitations.—

(1) In no case shall the total aggregateamount of payments toenrolled providers under this chapter exceedFederal appropriations andState appropriations from the fund to theDepartment of Public Welfarefor homeand community-basedcare services.


(2) In no caseshallthetotal aggregateamountof paymentstoentitiesthat provide home and community-basedcare services to assistedindividualsunderthis chapterexceedFederalappropriationsandStateappropriations from the fund to the department for home andcommunity-basedcareservices.

(3) In no caseshall the creation of this programbe consideredanentitlementto homeandcommunity-basedcareservices.

Section504. Accountability.Threeyears after the effective date of this chapter,the Departmentof

Public Welfare, in cooperationwith the department, shall conductaperformancereviewof the programto providehomeandcommunity-basedservicesunder thischapter.Theperformancereviewshallbebasedupon thereportpreparedundersection503(e)(4)andshallincludethefollowing:

(1) Thestrategicgoalsandobjectivesfor theprogram.(2) Whetherthesestrategicgoalsandobjectiveswereachieved.(3) The specific methodologyfor evaluatingthe results,along with

anyproposedrecommendationsfor improvement.

CHAFFER7TOBACCO USEPREVENTIONAND CESSATIONEFFORTS

Section701. Scope.Thischapterdealswith tobaccousepreventionandcessation-efforts.

Section702. Defmitions.The following wordsandphraseswhenusedin this chaptershallhave


“Committee.” The Tobacco Use Preventionand CessationAdvisoryCommitteeestablishedin section705.

“Department.”TheDepartmentof Health of theCommonwealth.“Primary contractor.” A personlocatedin this Commonwealththat

develops,implementsor monitors tobacco use preventionand cessationprogramsinaservicearea.Theterm includes:

(1) a for-profit or nonprofit organization,including a communityfoundation,thatprovidestobaccousepreventionandcessationprograms;

(2) an entity createdunder the act of April 14, 1972 (P.L.221,No.63), known as the PennsylvaniaDrug and Alcohol AbuseControlAct;

(3) amunicipalityor amunicipalhealthdepartmentcreatedpursuantto the act of August24, 1951 (P.L.1304,No.315), known as the LocalHealthAdministrationLaw;

(4) aninstitutionof highereducation;and(5) ahospitalestablishedunder the act of July 19, 1979 (P.L.130,

No.48),known astheHealthCareFacilitiesAct.“Program.” The comprehensivetobaccousepreventionand cessation

programestablishedunder section 703, the goal of which is to promote

SESSIONOF 2001 Act2001-77 767

tobaccouse prevention and cessationefforts that eliminate or reducedisease,disabilityanddeath,relatedtotobaccouseamongresidentsof thisCommonwealth,utilizing the “Best Practicesfor ComprehensiveTobaccoControl Programs,”or a successorprogram,of the National CentersforDiseaseControlandPrevention.

“Secretary.” TheSecretaryof Healthof the Commonwealth.“Service area.” A geographicareadesignatedby the Departmentof

Healthundersection704.“Serviceprovider.” A personlocated in this Commonwealththat is

selectedby theprimarycontractorto receiveagrantto providetobaccousepreventionandcessationprograms.Thetermincludes:

(1) a for-profit or nonprofit organizationthat providestobaccousepreventionandcessationprograms;

(2) an entity createdunder the act of April 14, 1972 (P.L.221,No.63),known as the PennsylvaniaDrug andAlcohol Abuse ControlAct;

(3) amunicipality or a municipalhealthdepartmentcreatedunderthe actof August 24, 1951 (P.L.1304, No.315), known as the LocalHealthAdministrationLaw,

(4) aninstitution of highereducation;(5) a hospital establishedunder the act of July 19, 1979 (P.L.130,

No.48),knownastheHealthCareFacilitiesAct; and(6) aschooldistrict or intermediateunit.

Section703. Tobaccousepreventionandcessationprogram.(a) Establishment.—Thereis herebyestablishedin the departmenta

tobaccouse prevention and cessationprogram. Appropriations from thefund to the departmentfor the program shall be used to implement theprogram.

(b) Components.—Theprogramshallincludethe following:(1) Statewide,communityand school programsdesignedto reduce

tobaccouse.(2) Chronicdiseaseprogramsto reducetheburdenof tobacco-related

diseases,includingpreventionandearlydetection.(3) Enforcementof applicablelawsrelatedto tobaccoaccess.(4) Efforts designedto counter tobacco influences and increase

health-relatedmessages.(5) Tobaccocessationprograms,with a priority for serving the

uninsuredandlow-incomepopulations.(6) Monitoring program accountabilityby requiring the evaluation

and documentation of or by conducting research regarding theeffectivenessof theprogramandprogramresults.

(7) Administrationandmanagementto facilitatethe coordinationofStateandlocal programs.

Section704. Powersanddutiesof department.Thedepartmenthasthe following powersandduties:

768 Act 2001-77 LAWS OFPENNSYLVANIA

(1) Toadministertheprogramin amannerwhich providesStatewideandlocal servicesto Commonwealthresidents.

(2) To annuallyestablishprogramprioritiesfor the Conunonwealthin consultationwith the committee.

(3) On a Statewidebasis,to awardgrantsandenterinto contractstoimplement the priorities established under paragraph (2). Thedepartmentshallsetspecific goalswith measurableobjectivesto monitorthereductionof tobaccoconsumptionunderrelatedprogramsdevelopedby Statewidegrantrecipients.

(4) To divide thisCommonwealthintono morethan67 serviceareasin orderto providefor theeffectiveandgeographicallydisperseddeliveryof the program. The departmentshall foster collaboration amonggeographicregionsof this Commonwealth.

(5) To enterintocontractsundersection708 with atleastoneandnomorethantwo primarycontractorsin eachservicearea.

(6) To approveplanssubmittedby primarycontractors,which shallinclude specific goals with measurableobjectives to be met by theprimarycontractorsfor eachservicearea.

(7) To coordinate,monitor andevaluatethe programfundedunderthischapterto ensurecompliancewith prioritiesandgoalsandtoensuredelivery of program services in all geographic areas of thisCommonwealth.The programshall be coordinatedwith otherefforts topreventandreduceexposureto andconsumptionof tobacco.

(8) To determinethe level of tobaccousein thisCommonwealthandeachof theserviceareasandmonitorchangesin thelevel of tobaccousein thisCommonwealthandeachof the serviceareasbasedon availableinformation.

(9) To pursuegrantsfor tobaccousepreventionand cessationasprovided in section VI(g) of the Master SettlementAgreement.Allmoneyawardedto thedepartmentunder thisparagraphshallbe listedinthereportunderparagraph(10).

(10) To prepareand submita report no later than November30,2002, and annuallythereafter to the chair and minority chair of thePublic Health andWelfare Committeeof the Senateandthe chairandminority chair of the Health and Human Services Committeeof theHouseof Representatives.Theannualreportshall bemadeavailableforpublic inspectionand posted on the department’spublicly accessibleWorld Wide Web site. The report shall include the activities of thedepartmentin implementingthischapter,including:

(i) Identification of Statewidegrant recipientsand the grantamountawardedto eachrecipient.

(ii) Identification of the primary contractor and all serviceprovidersin eachserviceareaandthe grantamountsawardedto eachcontractorandeachprovider.

(iii) Identificationof programprioritiesunderparagraph(2).


(iv) The goalsof eachprimary contractorandwhether its goalshavebeenmet.

(v) The information and methodology derived from theimplementationof paragraph(8), along with any recommendationsfor furtherreductionsin the levelof tobaccouse.

(vi) Applicationsmadeandgrantsreceivedunderparagraph(9).Section705. Committee.

(a) Establishment.—Thereis establishedin the departmenttheTobaccoUsePreventionandCessationAdvisoryCommittee.

(b) Membership.—Thecommitteeis comprisedofthefollowing:(1) Thesecretaryor adesignee,whoshallserveaschairperson.(2) Four membersappointedby thesecretary.(3) One memberappointedby the Presidentpro tempore of the

Senateandonememberappointedby theMinority Leaderof theSenate.(4) One member appointedby the Speaker of the House of

Representativesandonememberappointedby the Minority LeaderoftheHouseofRepresentatives.(c) Qualifications.—Membersappointedto the committeemustpossess

expertisein community,clinical or publichealthpracticesor in programsrelatedto tobaccousepreventionandcessation.

(d) Terms.—(1) Thesecretaryshallserveex officio.(2) A memberunder subsection(b)(2) shall serve a term of four

years.(3) A memberundersubsection(b)(3)shall serveatermof four years

butmayberemovedatthepleasureof theappointingauthority.(4) A memberundersubsection(b)(4) shall serveaterm of two years

butmayberemovedatthepleasureof theappointingauthority.(5) An appointmentto fill a vacancyshall be for the period of the

unexpiredtermor until asuccessoris named.(e) Meetings.—Thecommitteeshallmeetasneeded,but atleast twicea

year, to perform the dutiesprovided for in this chapter.A majority of themembersof the committeeconstitutesaquorum.A majority of themembersof the committeehasauthority to actupon anymatterproperly before it.The committeeis authorizedto establishrules for its operationandshallhold atleast onepublichearingannually.Meetingsof the committeeshallbeconductedunder65 Pa.C.S.Ch.7 (relatingto openmeetings).

(I) Expenses.—Membersshall receiveno paymentfor their services.Memberswho arenot employeesof Stategovernmentshall bereimbursedfor necessaryandreasonableexpensesincurredin thecourseof their-officialduties.

(g) Powersandduties.—Thecommitteehas the following powersandduties:

(1) Collectandreview informationrelatingto tobaccousepreventionandcessation.


(2) Make annual recommendationsto the departmentregardingtobaccousepreventionandcessationprogrampriorities. Considerationshallbegivento:

(i) prevention and cessationprograms operating in minoritycommunitiesandamongotherdemographicgroupsanddemographicregionswhich sufferfrom disproportionatelyhighratesof lung canceror othertobacco-relateddiseases;

(ii) efforts which would lower tobacco use among school-agechildren; and

(iii) the delivery of cessationservicesby approved“health carepractitioners”as definedin section 103 of the act of July 19, 1979(P.L.130,No.48),known astheHealthCareFacilitiesAct.(3) Make annual recommendationsto the departmenton the

evaluationproceduresto be usedin approvingprimarycontractorsandserviceproviders.

Section706. Primarycontractors.(a) Applicants.—.-Inorder to be aprimarycontractor,an applicantmust

submit a plan to the departmentwhich demonstratesthe ability of theprimary contractorto develop,implementand monitor the programin aservice area. Priority may be given to primary contractorsthat haveexperiencein providing or coordinating tobacco use prevention andcessationservices.

(b) Department.—Thedepartmentshall review plans submittedundersubsection(a) andshall enterinto acontractwith the primarycontractorselectedtoprovidetheprogramin eachservicearea.

(c) Grants.—Theprimary contractor shall award grants to serviceproviderstoimplementtheprogramfor theservicearea.Thegrantsmustbeapprovedby thedepartment.

(d) Dutiesof primary contractor.—Theprimary contractorshall do allof thefollowing:

(1) Developaproposedplan,subject to departmentapproval,whichmeetsthe tobaccousepreventionandcessationneedsin the serviceareaandthegoalsandprioritiesestablishedundersection704(2).

(2) Award grantsto serviceprovidersto implementthe programinthe service areain accordancewith the plandevelopedandapprovedunderparagraph(1). Prioritymaybe givento serviceproviderswhohaveexperiencein providing tobaccousepreventionandcessationservices.Ina service areawith multiple service providers,no individual serviceprovider shall receivemore than 50% of the fluids awardedto theprimarycontractorunlessotherwiseapprovedby thedepartment.

(3) Establishtobaccoreductiongoalsfor eachserviceprovider in theserviceareaconsistentwith theplanadoptedunderparagraph(1).

(4) Ensurethatserviceprovidersaremeetingtheprioritiesandgoalssetforth in theplan.


(5) Coordinatetheplanwith otherhealth-relatedprogramsto preventor reduce tobaccouse by individuals receiving servicesfrom theseprograms.

(6) Increaseparticipationin the programby schoolsin the servicearea.

(7) Solicit input from health care providers, communityorganizations, public officials and other individuals and groupsregardingtheplanfor eachservicearea.

(8) Coordinateefforts with local law enforcementto enforceexistingtobaccorestrictions.

(9) Prepareandsubmitreportsasrequiredby the departmentwhichshallincludeall of thefollowing:

(i) Identificationof serviceprovidersandgrantamountsfor eachserviceproviderby serviceareaby fiscalyear.

(ii) Identificationof specific local goalsfor theprogramto bemetby serviceprovidersfor eachservicearea.

(iii) Detailsof thespendingplan by servicearea.(iv) Identificationof indicatorsused to evaluatewhetherspecific

goalshavebeenmet.Section707. Serviceproviders.

(a) Applications.—Serviceproviders must apply to the primarycontractorin their serviceareafor a grant to deliver programservicesinaccordancewith section706. An applicationto be a serviceprovider mustincludeadescriptionof thepurposeof the serviceandthemannerin whichtheservicewill reduceor preventtobaccouse.Theapplicationshallincludethemethodby whichthe serviceproviderproposesto beevaluated.

(b) Serviceproviderannualreport.—Aserviceproviderawardedagrantunderthis chaptershallannuallyreportto theprimarycontractorandtothedepartmentall of thefollowing:

(1) Expendituresmadewith thegrantawards.(2) Whetherthe goals set by theprimary contractorhavebeenmet

andthemethodologyutilized tomeasureprogramresults.(3) Any other information deemednecessaryby the primary

contractoror thedepartment.Section708. Contractsandpurposes.

(a) Contracts.—Contractswith primary contractors and Statewidecontractorsshallbefor aperiodnot toexceedthreeyears.Contractsshallbeawardedin accordancewith 62 Pa.C.S.(relating to procurement)andmaybeawardedon amultiple-awardbasis.Fundingfor multiyearcontractsshallbe subject to the availability of funds as appropriatedby the GeneralAssembly.

(b) Purpose.—Fundsallocatedunderthis chaptershallbeusedfor all ofthe following:

(1) At least70% shall be usedfor grantsto primarycontractorstodeveloplocalprograms.


(2) The remainingfundsshall be usedfor compliancewith Federalrequirementsunderthe act of December21, 2000(Public Law 106-554,:114 Stat. 2763),andfor Statewideefforts consistentwith the prioritiesestablishedundersection704(2).After June30,2002,nomorethanone-half of the funds set aside under this paragraphshall be used forcountermarketingmedia campaigns.Media campaignspreparedfortelevisionor radio may be conductedthrough public or privatemediaoutlets.All fundsusedfor suchcampaignsshall bespentto the greatestextentpossibleon efforts that have beenproven successfulin otherstates.(c) Limitations.—Theaggregateamount of contractsandgrantsin any

fiscal year may not exceed the amount of the appropriation to thedepartmentfor the tobacco preventionprogram in that fiscal year. Theprovisionof agrantunder this chaptershall not constitutean entitlementderived from the Commonwealthor a claim on any other funds of theCommonwealth.

(d) Restrictions.—Atobaccocompanyor an agentor subsidiaryof atobaccocompanymaynot be awardeda contract or grantas aStatewidecontractor,primarycontractoror serviceprovider.Section709. Accountability.

(a) Audits.—Contracts with Statewide contractors and primarycontractorsand grants to service providers shall be subject to audit asprovided by law. Contracts with Statewide contractors and primarycontractorsandgrantsto serviceprovidersshall be subject to an annualaudit by the department.Audits of thesecontractsand grantsare to beconducted in accordancewith generally acceptedgovernmentauditingstandards.

(b) Reviewprocedures.—AnyStatewidecontractor,primarycontractoror serviceprovider thatreceivesa contractor a grantunderthis chaptershallbe subjectto a performancereviewby thedepartment.As appropriate,the performancereview shall be basedupon informationsubmittedto thedepartmentthatincludesthefollowing:

(1) The contractor’s or service provider’s strategic goals andobjectivesfor the use of grantmoneysfor tobaccousepreventionandcessation.

(2) The contractor’sor serviceprovider’s annualperformanceplansettingforth howthesestrategicgoalsandobjectivesare to be achievedand the specific methodology for evaluatingresults,along with anyproposedmethodsfor improvement.

(3) Thecontractor’sor serviceprovider’s annualperformancereportsetting forth the specific resultsin achieving its strategic goals andobjectives for tobacco use prevention and cessation, including anychangesin the incidenceof tobaccouseamongtargetpopulations.

(4) Theprogressmadein achievingexpectedprogramprioritiesandgoals.


(5) Any otherinformationdeemednecessaryby thedepartment.(c) Penalty.—If an audit or performancereview indicates that a

Statewidecontractor, a primarycontractoror a serviceprovider failed tocomply with contractrequirementsor meetperformancegoals,contractorsandprovidersmay be subjectto a reduction in or ineligibility for futurecontractor grantfunding.Section710. Miscellaneousprovisions.

Notwithstandingany otherprovisionsof this chapter,the departmentora primary contractor,with the approval of the department,may awardgrantsthat promotehealthylifestyles through educationprogramswhichincorporate tobacco use prevention and cessation services. Educationprogramsmay includeInternet or computer-basedinstruction and healthand fitness guidancerelating to healthy life choicesand the dangersoftobaccousein conjunctionwith developmentalandinstructional programsfor schoolathleticcoachesandschoolathletes.

CHAFFER9COMMONWEALTH UNIVERSAL RESEARCHENHANCEMENT

Section901. Scope.This chapterdealswith Commonwealthuniversalresearchenhancement

efforts.Section902. Definitions.

The following wordsandphraseswhenusedin this chaptershall havethe meanings given to them in this section unless the context clearlyindicatesotherwise:

“Advisory committee.” The Health Research Advisory Committeeestablishedin section903(b).

“Applicant.” Anyof thefollowing locatedin this Commonwealth:(1) A person.(2) An institution.(3) An entity establishedundertheactof August24, 1951 (P.L.1304,

No.315), knownastheLocal HealthAdministrationLaw.“Biomedical research.” Comprehensiveresearch pertaining to the

applicationof the natural sciencesto the study and clinical practiceofmedicine at an institution, including biobehavioral researchrelated totobaccouse.

“Clinical research.” Patient-orientedresearchwhich involves directinteractionand study of the mechanismsof humandisease,includingtherapeuticinterventions,clinical trials, epidemiologicaland behavioralstudiesandthedevelopmentof newtechnology.

“Department.” TheDepartmentof Health of theCommonwealth.“Health servicesresearch.”Anyof thefollowing:

(1) Researchon thepromotionandmaintenanceof health,includingbiobehavioralresearch.

(2) Researchon thepreventionandreductionof disease.


(3) Researchon the delivery of healthcareservicesto reducehealthrisksandtransferresearchadvancesto communityuse.“Infrastructure.” Equipment, supplies, nonprofessional personnel,

laboratory or building constructionor renovations,or the development,acquisition or maintenanceof technology, including training, used toconductresearch.

‘Institution.” Any of thefollowing locatedin thisCommonwealth:(1) A nonprofitentitythatconductsresearch.(2) A hospitalthat conductsresearchandis establishedundertheact

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

(3) An institution ofhigher educationthatconductsresearch.“NIH.” TheNationalInstitutesof Health.‘Peer review.” A processapprovedby the Departmentof Health or the

National Institutesof Health in which a reviewpanelwhich includestheapplicant’s professional peers reviews and evaluates research grantapplicationsusingarating systemof scientificandtechnicalmerit.

“Research.” Biomedical, clinical andhealth servicesresearchwhichmayincludeinfrastructure.

“Secretary.” The Secretaryof Healthof theCommonwealth.Section903. Healthresearchprogram.

(a) Programestablishment.—.(1) Thereis establishedin thedepartmentahealthresearchprogram

which shall be known as the Commonwealth Universal ResearchEnhancementProgram.Appropriationsfrom the fund to the departmentshall be used to fund researchprojects and relatedinfrastructurebyeligible applicants.This includes:

(i) biomedicalresearch;(ii) clinical research;and(iii) healthservicesresearch.

(2) Fundsappropriatedfor theprogrammaybeusedto conductpeerreviewsandperformancereviews.(b) Advisorycommittee.—

(1) Thereis herebyestablishedin thedepartmentthe HealthResearchAdvisoryCommittee.

(2) Thecommitteeis comprisedof thefollowing:(i) Thesecretaryor a designee,whoshallserveaschairperson.(ii) Fourmembersappointedby theGovernor.(iii) One memberappointedby the Presidentprotemporeof the

Senateand one memberappointedby the Minority Leaderof theSenate.

(iv) One member appointedby the Speakerof the House ofRepresentativesandonememberappointedby theMinorityLeaderoftheHouseof Representatives.


(3) Membersappointedto the committeeby the Governor mustpossessexpertisein health care or research,with representationbyinstitution-basedresearch specialists, practicing clinicians, clinicalinvestigatorsandpublichealthprofessionals.

(4) Termsareasfollows:(i) Thesecretaryshallserveex officio.(ii) A memberunderparagraph(2)(ii) shall serveaterm of six

years.(iii) A memberunderparagraph(2)(iii) shallserveaterm of four

yearsbutmayberemovedatthepleasureofthe appointingauthority.(iv) A memberunderparagraph(2)(iv) shall servea termof two

yearsbutmayberemovedatthepleasureoftheappointingauthority.(v) An appointmentto fill avacancyshallbe for theperiod of the

unexpiredtermor until asuccessoris appointedandqualified.(5) Thecommitteeshall meetas needed,but at leasttwiceayear,to

fulfill the purposesprovided for in this chapter. A majority of themembersof the committeeconstitutesa quorum. A majority of themembersof thecommitteehasauthorityto actupon anymatterproperlybeforeit. Thecommitteeis authorizedto establishrulesfor its operationandshall holdpublic hearings,as necessary,to obtainpublic input andmakerecommendationsto the departmentregardingresearchpriorities,evaluationandaccountabilityproceduresandrelatedissues.Meetingsofthe committeeshall be conductedunder65 Pa.C.S.Cli. 7 (relating toopenmeetings).

(6) Membersshallreceiveno paymentfor their services.Memberswho are not employeesof State governmentshall be reimbursedfornecessaryandreasonableexpensesincurredin thecourseof their officialduties.

Section904. Departmentresponsibilities.Thedepartmenthasthefollowing powersandduties:

(1) Administer the healthresearchprogramestablishedunder thischapter.

(2) Establish,in conjunctionwith the Health ResearchAdvisoryCommittee,the researchpriorities of theCommonwealth.In developingthese researchpriorities, the national health promotion and diseaseprevention objectives establishedby the United StatesDepartmentofHealthandHumanServices,as appliedto this Commonwealth,shallbeconsidered.The priorities shall include the identification of criticalresearch areas, disparities in health status among variousCommonwealthpopulations,expectedresearchoutcomesand benefitsanddiseasepreventionandtreatmentmethodologies.Theprioritiesshallbereviewedannuallyandrevisedasnecessary.

(3) Exceptasprovided in section905(1) and(g), reviewapplicationsandawardresearchgrantsto applicantsconsistentwith the priorities


establishedunderparagraph(2). Researchgrantsmaybe awardedfor aperiodnot to exceedfour yearsforeachproject.

(4) Developandimplementpeerreviewproceduresto beusedfor thereview of grant applications for projects funded pursuantto section906(2)and(3).

(5) Publish an annual report on all researchfunded under thischapter.The report shallinclude:

(i) the aggregateamount of researchgrants awardedto eachapplicant;

(ii) the name and addressof each principal investigatorthatreceivedagrant;

(iii) theprojecttitle andpurpose;(iv) thenameandemployerof eachparticipatingresearcher;(v) theexpectedresearchoutcomesandbenefits;(vi) theamountof eachresearchgrantawarded;(vii) aim anticipateddisbursementscheduleby fiscal year for each

grantawarded;(viii) areportof expendituresby grantby fiscalyear;and(ix) adetailedsummaryof theresearchcompletedthatyear.

(6) Thereport underparagraph(5) shall beprovidedto thechairandminoritychairof thePublicHealthandWelfareCommitteeandthechairandminority chairof the AppropriationsCommitteeof the Senateandthe chair and minority chair of the Health and Human ServicesCommitteeand the chair and minority chair of the AppropriationsCommitteeof the Houseof Representativesno later thanNovember30,2002,andannuallythereafter.Theannualreportshallbemadeavailablefix public inspectionandpostedon the department’spublicly accessibleWorldWideWebsite.

Section905. Peerreviewprocedures.(a) Peerreview required.—Exceptfor infrastructureand for projects

fundedunder section 906(1), researchfunded underthis chaptershall bepeerreviewedandselectedin accordancewith this section.

(b) Prior peerreview.—Researchwhichhasreceivedpeerreviewby theNational Institutesof Health, the Centersfor DiseaseControl or anotherFederalagencymay beapprovedandrankedfor funding by thedepartmentconsistentwith theprioritiesestablishedundersection904(2).

(c) Departmentpeer review.—Researchwhich hasnot receivedpeerreview as providedin subsection(b) shall be subjectto peerreview by thedepartmentin accordancewith subsection(d) prior to beingconsideredforfundingundersection906(2)and(3).

(d) Peer review panels.—Thedepartmentshall establishpeer reviewpanels in various disciplines, as necessary,to review researchgrantproposalswhich areconsistentwith thepriorities establishedundersection904(2). A panelshall be composedof at least threenationally recognizedphysicians,scientistsor researchersfrom the sameor similar disciplineas

SESSIONOF2001 Act 2001-77 777

theresearchgrantproposalunderreview.Membersof apeerreviewpanelmaybe residentsof otherstates.In no caseshalla memberof apeerreviewpanelbe an employeeof an applicantwhose grantproposal is under itsreview.

(e) Panelreviewfactors.—Areviewpanelshalldetermineeligibility forgrant funding basedon the highest-rankedpeer review scoresthrough arating systemconsistentwith Federalratingstandardsas developedby thedepartment.A panelshall review and rank researchprojectseligible forfunding in a mannerwhich recognizesscientific andtechnicalmerit on thebasisof scientificneed,scientific method,researchdesign,adequacyof thefacility andqualificationsof theresearchpersonnel.

(1) Ethical standards.—Noresearchfundedunder this chaptershallbepermitteduntil amemorandumof understandingbetweenthe applicantandthesecretaryhasbeenexecutedspecifyingthat theresearchtobeperformedandall individuals performing such researchshall be subject to Federalethicalandproceduralstandardsof conductasprescribedby theNIH on thedatethememorandumof understandingis executed.Researchfundedunderthis act shall observe the Federal ethical and procedural standardsregulating researchand researchfindings, including publications andpatents,which are observedunder NIH extramuralfunding requirementsandNIH grantspolicy statementsandapplicablesectionsof 45 CFRPt. 74(relatingto uniform administrativerequirementsfor awardsandsubawardsto institutionsof higher education,hospitals,othernonprofitorganizations,and commercialorganizations;and certain grantsand agreementswithStates, local governmentsand Indian tribal governments) and Pt. 92(relating to uniform administrativerequirementsfor grantsandcooperativeagreementsto Stateandlocal governments).

(g) EthicsAdvisoryBoard.—(1) TheEthics AdvisoryBoardshallbe composedof six individuals

who arenot officers or employeesof theCommonwealth.Thesecretaryshall makeappointmentsto the board from among individuals withqualifications andexperienceto provide adviceand recommendationsregardingethical mattersin research.The membersof the boardshallinclude one attorney, one ethicist, one practicing physician, onetheologian,onescientistwith experiencein biomedicalresearchandonescientist with experiencein behavioral research.In no caseshall amemberof theboardbeanofficer, director,employeeor paidconsultantof anapplicantwhosegrantproposalis underreview.

(i) A majorityof theboardshallconsistof fourmembers.(ii) Members of the board shall serve at the pleasureof the

secretary.(iii) The secretaryshall designatean individual from amongthe

membersof theboardto serveas thechairof theboard.(iv) A memberof the boardshall receiveno paymentfor service

but shall be reimbursedby the departmentfor necessaryand


reasonableexpensesincurredin the courseof the member’sofficialduties.

(v) An annual report setting forth a summationof the boardactivitiesas well as eachboarddecisionshall be submittedno laterthanNovember30of eachyearto the chairandminority chairof thePublic HealthandWelfare Committeeof the Senateandto the chairandminority chairof the HealthandHumanServicesCommitteeofthe House of Representativesand shall be madeavailableto thepublic.(2) Theboardshall beconvenedby thesecretaryto adviseandmake

recommendationswhenaresearchprojectmay bedenieddueto ethicalconsiderations,consistentwith the standardsset forth in subsection(1)thatarein effecton thedatetheboardis convened.

(i) The departmentshall notify the researchapplicant of theinitiation of anethicsreview.Theapplicantshallhavethe opportunitytoprovidecommenton theethical considerationsof theproject totheboard.Theboardmayreceiveothercommentsor informationtoassistin its review.

(ii) The board shall have accessto all relevant informationpossessedby thedepartmentregardingtheresearchproject.

(iii) Within 60 daysof initiating its review, the boardshallsubmitto the secretarya report with its findings and recommendationsregardingtheethical considerationsof theresearchproject.(3) Fundingfor a researchprojectunder this chaptershallbe denied

by thesecretarybasedon afmding of improperethicalconsiderationsbyamajority of theboard.

(4) As usedin thissubsection,the following wordsandphrasesshallhavethemeaningsgivento themin thisparagraph:

“Board.” TheEthicsAdvisoryBoard.“Ethical considerations.” Mattersconcerningwhetherthe proposed

conductof or subject of the researchis medically, sociologicallyandlegallymoralandproper.(h) Final selection.—Basedon the proceduresset forth in thissection

and the rankings establishedby the relevant peer review panel, thedepartmentshall awardresearchgrantsto selectedapplicants.In makingtheseawards,the departmentshall avoid unnecessaryduplication, ensurerelevance to the appropriate researchpriority, encouragecollaborationbetweenapplicantsand providefor the developmentof a complementaryStatewideresearchprogram.Section906. Useof funds.

Researchprojectsconductedunderthis sectionshall be consistentwiththe priorities establishedunder section 904(2). Fundsunder this sectionshall beallocatedfor thefollowing purposes:

(1) Seventypercentof the fundsappropriatedunderthissectionshallbeusedto fund researchpursuantto section908.


(2) Fifteen percentof thefundsappropriatedunderthissectionshallbe usedto fimd clinical andhealthservicesresearchprojectsby eligibleapplicants.

(3) Fifteen percentof thefundsappropriatedunder this sectionshallbeusedto fund otherresearchprojectsby eligible applicants.

Section907. Applications.(a) Generalrule.—Anapplicationfor aresearchgrantundersection906

mustincludeall of thefollowing, asapplicable:(1) Thenameandaddressof theapplicant.(2) The identificationof participatingresearchers.(3) Thedescriptionof thepurposeandmethodologyof theresearch

project.(4) An accounting of proposed expenditures,to include salary

expenses,capitalequipmentandconstructionor renovation.(5) Theexpectedresearchoutcomesandbenefits.(6) An explanationoftheproject’sevaluativeprocedures.(7) A list of otherproposedfunding sourcesbeing soughtby the

applicantfor theresearchproject.(8) Any otherinformationdeemednecessaryby thedepartment.

(b) Report.—Anapplicantreceivingaresearchgrantunderthis chaptershall report annually to the departmenton the progressof the researchprojector as often as the departmentdeemsnecessary.The resultsof theresearchandotherinformationdeemednecessaryby thedepartmentshallbereported to the departmentupon conclusion of the researchproject inaccordancewith section910.

(c) Limitations.—(1) An applicant for a researchgrant under section 906 maynot

expendmorethan50%of its grantfor infrastructure.(2) Theawardof aresearchgrantshallnot constitutean entitlement

derived from the Commonwealth or a claim on any funds of theCommonwealth.

Section908. NationalInstitutesof Health fundingformula.(a) Eligibility.—An institution that conducts research in this

Commonwealthandhasreceivedfunding from the NationalInstitutesofHealthduring eachof the threeimmediatelyprecedingFederalfiscal yearsshall beeligible to receiveagrantpursuantto section906(1).For oneyearfrom the effective date of this act, an institution that has immediatelysucceeded,by assetacquisition, theresearchfunction of anotherinstitutionthat receivedNationalInstitutesof Health funding during anyof the fourimmediatelyprecedingfiscal yearsshall be consideredeligible to receiveagrantpursuantto section906(1).

(b) Funddistribution.—Fundsunderthis sectionshall bedistributedtoeligibleinstitutionsasfollows:

(1) Twenty percent shall be distributed to each institution thatreceivesmore than $175,000,000as an average amount from the


National Institutesof Health during the three immediately precedingFederalfiscalyears.

(2) Seventeenpercent shall be distributed to each institution thatreceivesmore than $175,000,000in federally sponsoredresearchanddevelopmentobligationsin the immediatelyavailableprecedingFederalfiscal yearasreportedby the NationalScienceFoundationandreceivesmore than $60,000,000 as an average amount from the NationalInstitutes of Health during the three immediately precedingFederalfiscalyears.

(3) The remainingfundsshall be distributed to eligible institutionsbasedon the percentagecalculatedby dividing an institution’s averageaward from the NationalInstitutesof Health for the three immediatelyprecedingFederalfiscal yearsby the sum of the averageannualawardfrom theNationalInstitutesof Healthfor all Pennsylvania-basedeligibleinstitutionsduring the three immediately availableprecedingFederalfiscalyears.

(4) An institutionisnot eligible toreceivefundsundermorethan-oneparagraphofthis subsection.(c) Additional requirements.—Aninstitution thatreceives$400,000or

morepursuantto this sectionshall include the following informationwithits applicationundersection907(a):

(1) A plan for the timely licensureor commercialdevelopmentofresearchresultsconductedunderthissection,including its managementof intellectualproperty.

(2) Standardforms of agreementdevelopedby the institution for usein thelicensingof researchresults.

(3) A plan to establishaffiliations, exchanges,partnershipsor othercooperativeefforts with postsecondaryeducationalinstitutionsto provideprogramsto train studentsandhealthprofessionalsin the biomedicalfield.

(4) A description of the training opportunities provided forresearchersemployedby the institution relating to the licensingandcommercialdevelopmentof research.

(5) Outreach efforts directed toward informing businessesandbusinessorganizationsregardingrecentdevelopmentsin researchbeingconductedby theinstitutions.

(6) A plan for collaboration with an applicant, an institution, aregional biomedical researchcenterunder Chapter17 or a for-profitcorporationor otherbusinessentity to participatein the developmentofresearch.

Section909. NationalCancerInstitutefundingformula.(a) Eligibility.—An institution that conducts research in this

Commonwealthand has received funding from the National Cancerinstituteduring eachof thethreeimmediatelyprecedingFederalfiscal yearsshallbeeligible to receiveagrantunderthis section.


(b) Fund distribution.—Fundsshall be distributed to an eligibleinstitution basedon the percentagecalculatedby dividing that institution’saverageawardfrom theNationalCancerInstitutefor thethreeimmediatelyavailableprecedingFederalfiscal yearsby the sum of the averageannualawardfrom theNationalCancerInstitutefor all Pennsylvania-basedeligibleinstitutionsduring the threeimmediatelyavailableprecedingFederalfiscalyears.

(c) Ineligibility.—An institution that receives funding pursuanttosection908(b)(1)and(2) shallbeineligible for fundingunderthissection.

(d) Requirements.—Aninstitutionthatreceivesagrantpursuantto thissectionshallcomplywith all applicablerequirementsof thischapter.Section910. Accountabilityprocedures.

(a) Requirements.—Anapplicantthat receivesa researchgrantunderthis chaptershall be subject to a performancereview by the departmentupon completionof aresearchprojectormoreoftenasdeemednecessarybythe department.The performancereview shall be basedon an evaluationprocessdevelopedby the departmentin consultationwith the advisorycommittee.Informationshallbesubmittedby researchgrantrecipientsandshall include,asapplicable,thefollowing:

(1) The progressmade in achievingexpectedresearchgoals andobjectives.

(2) The extentof clinical activitiesinitiated andcompleted,detailingthe numberof treatment,preventionanddiagnosticstudies;thenumberof hospitalsandhealthcareprofessionals;thenumberof subjectsrelativeto targetedgoals;andtheextentof penetrationof thestudiesthroughouttheregionor this Commonwealth.

(3) The numberof peer-reviewedpublicationsand the numberoflicenses and patents filed, including commercial developmentopportunities.

(4) Any changesin risk factors, servicesprovided, incidenceofdisease,deathfrom disease,stageof diseaseat the timeof diagnosisorotherrelevantmeasuresof the outcome,impact andeffectivenessof theresearchbeingconducted.

(5) Any major discoveries,new drugs and new approachesforprevention, diagnosis and treatment which are attributable to thecompletedresearchproject.

(6) Any otherinformationdeemednecessaryby thedepartment.(b) Penalty.—Notwithstandingany other provisionof this chapter,an

applicant that receivesan unfavorablereview by the departmentundersubsection(a) maybe subject to a reductionin or ineligibility for researchgrantfundingunderthis chapter.

CHAPTER 11HOSPITAL UNCOMPENSATEDCARE

Section1101. Scope.


Thischapterdealswith hospitaluncompensatedcare.Section1102. Definitions.

Thefollowing wordsandphraseswhen usedin this chaptershall havethe meaningsgiven to them in this section unless the context clearlyindicatesotherwise:

“Bad debt expense.” The costof care for which a hospital expectedpaymentfrom the patientor a third-party- payor, but which the hospitalsubsequentlydeterminesto beuncollectible.

“Charity careexpense.” Thecostof carefor whichahospitalordinarilychargesafeebut which is providedfreeor ata reducedrateto patientswhocannotafford topaybut whoare not eligible for publicprogramsandfromwhomthehospitaldidnot expectpaymentin accordancewith thehospital’scharitycarepolicy.

“Children’s Health InsuranceProgram.” The insurance programestablishedby Article XXIII of theactof May 17, 1921 (P.L.682,No.284),knownasTheInsuranceCompanyLawof 1921.

“Council.” The Health Care Cost ContainmentCouncil establishedunderthe actof July 8, 1986 (P.L.408,No.89), knownas the HealthCareCostContaimnentAct.

“Department.” The Department of Public Welfare of theCommonwealth.

“Emergent medically necessaryservices.” Immediate medical careconsistentwith the definition of emergencyserviceas setforth in section2116 of the act of May 17, 1921 (P.L.682, No.284), known as TheInsuranceCompanyLaw of 1921.

“Extraordinary expenses.” The cost of hospital inpatient servicesprovidedto anuninsuredpatientwhichexceedstwice thehospitaNaveragecostper stayfor all patients.

“Hospital.” A healthcarefacility licensedas a hospitalpursuantto theactof July 19, 1979 (P.L.130, No.48),knownas the Health CareFacilitiesAct, or pursuantto Article X of the act of June 13, 1967 (P.L.31,No.21),known asthePublicWelfareCode.

“Inpatientday.” A billing unit correspondingto eachdayan individualstaysin ahospitalasapatient.

“Insurer.” Any insurancecompany, association, reciprocal, healthmaintenanceorganization, fraternal benefits society or a risk-bearingpreferredproviderorganizationthatoffershealthcarebenefitsandis subjectto regulationunderthe actof May 17, 1921 (P.L.682,No.284), known asThe InsuranceCompanyLaw of 1921,or the actof December29, 1972(P.L.1701, No.364), known as the Health MaintenanceOrganizationAct.The term includesan entity and its subsidiariesthat operatesubjectto theprovisionsof 40 Pa.C.S.Ch. 61 (relating to hospitalplan corporations)or63 (relating toprofessionalhealthservicesplancorporations).


“Medical assistance.” The State program of medical assistanceestablishedunderArticle IV(f) of theactof June13, 1967 (P.L.31,No.21),knownasthePublicWelfareCode.

“Medical assistanceday.” An inpatientdayprovidedby a hospitalto apatient enrolled in the State programof medical assistanceestablishedunder the act of June 13, 1967 (P.L.31, No.21), known as the PublicWelfareCode,or for asimilar programin otherstates.

“Medicare SSIday.” An inpatientdayprovidedby ahospitaltoapatientenrolledin bothMedicarePartA andSupplementalSecurityIncome(SSI)asdeterminedby the Centersfor MedicareandMedicaidServices.

“Net patient revenue.” The estimated net realized amounts frompatients,third-party payorsand othersfor healthcare servicesrendered,including estimatedretroactiveadjustmentsdue to future audits, reviews,settlementsandinvestigations.Retroactiveadjustmentsareaccruedon anestimatedbasisin theperiodthe relativeservicesare renderedandadjustedin futureperiodsas adjustmentsbecomeknown.Thisamountshallbeequalto the amountpresentedin themostcurrentauditedfinancial statementasfiled with thecouncil.

“Publicly fundedhealthcareprogram.” Careor servicesrenderedby agovernmententity or any facility thereofor healthcareservicesfor whichpaymentis madedirectly or indirectly by a governmententity, including,but not limited to, Medicareand medical assistance,or by their fiscalintermediary.

“Qualified hospital.” An eligible hospitalwhich hasan uncompensatedcarescoreat or exceedingthemedianscoreof all eligible hospitals.

“Uncompensatedcare.” The costof careprovidedto patientsfinanciallyunableor unwilling to pay for servicesprovided by ahospital.This costshallbedeterminedby thecouncil utilizing reporteddataandthe hospital’scost-to-chargeratio and shall includecharity care expenseandbad debtexpense.

“Uninsured.” An individual who has no health insurancecoverage,whose coveragedoes not reimbursefor the medically necessaryservicesprovidedby ahospitalor who doesnot receivebenefitsundera publiclyfundedhealthcareprogram.Section1103. Hospitaluncompensatedcarepayments.

(a) Programestablislunënt.—Thereis establishedin thedepartmenttheHospital UncompensatedCareProgram.Appropriationsfrom the fund tothe departmentfor the Hospital UncompensatedCareProgrampursuanttosection 1106(b) shall be used to annually compensatehospitals inaccordancewith section 1104 for a portion of the uncompensatedcareprovidedto patients.

(b) Departmentresponsibilities.—Thedepartmenthas the followingpowersandduties:

(1) AdministertheHospital UncompensatedCareProgram.


(2) Determine the eligibility of hospitals on an annual basis inaccordancewith section 1104(b).Noticeof eligibility shallbe publishedin thePennsylvaniaBulletin by April 1 for theforthcomingfiscalyear.

(3) Calculateuncompensatedcare scoresfor eligible hospitalsundersection1104(c).

(4) Calculateandmakepaymentstoqualifiedhospitalsundersection1104(d)on anannualbasis.

(5) Seek Federal matching funds under medical assistancetosupplementpaymentsmadeundersection1104.

(6) Prepareandsubmita report no later than November30, 2002,and annually thereafterto the chair and minority chairof the PublicHealthandWelfare Committeeandthe chair andminority chair of theAppropriationsCommitteeof the Senateand the chair and minoritychairof the Health andHumanServicesCommitteeandthe chairandminority chair of the Appropriations Committee of the House ofRepresentatives.The annualreport shall be madeavailablefor publicinspectionand postedon the department’spublicly accessibleWorldWideWebsite.Thereport shalllist all of thefollowing:

(i) Thenameandaddressof eacheligible hospital.(ii) The name,addressand paymentamountfor each qualified

hospital.(iii) Thehealthsystemaffiliation of eachqualifiedhospital.(iv) Theuncompensatedcarescorefor eachqualifiedhospital.(v) Themethodologyutilized to computethe uncompensatedcare

scorefor eacheligiblehospital.(7) No laterthan June30, 2003, thedepartmentshall contractwith

anindependententity to evaluatethepaymentmethodologyto determinethe extentto which paymentsunder this sectionare madeto hospitalswith the greatestuncompensatedcare burden.The reportshall containrecommendationsto the Governor, the departmentand the GeneralAssemblyconcerningthepaymentmethodology.(c) Informationcollection.—Thedepartmentshall:

(1) Collectdataand informationasnecessaryto determinehospitaleligibility for paymentunder this chapter,including the department’smedicalassistancedatafor medicalassistanceinpatientdayspercentage,the uncompensatedcarepercentageandnet patientrevenuedata fromthe council and data from the Centersfor Medicare and MedicaidServicesor their designeeregardingMedicareSSIdayspercentage.

(2) Contact the appropriatedatasourceif thereis missingdataandobtain thenecessaryinformation.(d) Reportingrequirements.—

(1) Within 60 days of the effective date of this chapter, thedepartmentin consultationwith the council shall establishan advisorycommittee comprisedof nine individuals with expertise in hospitaladministration,hospitalfinanceandreimbursementandhospitalpatient


accountsmanagement,including arepresentativeof thedepartmentandrepresentativeof the council. The purposeof the advisorycommitteeshall be to assist the departmentand the council in improving theaccuracy,consistencyand timelinessof the information collectedandused to determine payments to hospitals under the HospitalUncompensatedCare Program. The advisory committee shall makerecommendationsto the departmentconcerningthe informationthatisrequiredto more accuratelymeasurethe amount of bad debt expenseincurred and charity careexpenseprovidedby hospitals to uninsuredpatientsin thisCommonwealth.

(2) Within 180 days of the effective date of this chapter, thedepartmentshall developandprovidepublic notice to hospitalsof theuniform reporting requirementsfor uncompensatedcare which shalladdressbothcharitycareexpenseandbaddebtexpensecomponents.Theuniform reporting requirements for charity care expense shallincorporatethe recommendationsof the advisorycommitteeandaddressthe following:

(i) Patienteligibility for otherpublic or privatecoverage.(ii) Incomeeligibility thresholdbasedon family size.(iii) Considerationof other resourcesavailableto a patientor

responsibleparty.(iv) Patientor responsiblepartyemploymentstatusandearning

capacity.(v) Otherfinancialobligationsof thepatientor responsibleparty.(vi) Other sourcesof funds availableto the hospital such as

endowmentsor donationsspecifiedfor charity care.The uniform reporting requirements for bad debt expense shallincorporatethe recommendationsof the advisorycommitteeand shalladdresshospitalcollectionproceduresfor unpaidpatientresponsibility,includingdeductibles,coinsurance,copaymentsandnoncoveredservices.Patientsarepresumedto beable to pay for medicallynecessaryservicesuntil andunlessinformationis obtainedtoindicateaninability or refusalto pay.

(3) For fiscal years beginningon or afterJanuary1, 2002,hospitalsshall report uncompensatedcare information to the council inaccordancewith the reportingrequirementsset forth in this section inorder to receive paymentsunder the Hospital UncompensatedCareProgram.

Section 1104. Eligibility andpayment.(a) Determinationof eligibility.—The departmentshall determinethe

eligibility ofeachhospitalfrominformationcollectedundersection1103.(b) Requirementsfor hospitals.—Ahospital is eligible to apply for

paymentfrom theHospital UncompensatedCareProgramif thehospitalhasaplanin placeto servetheuninsuredand:


(1) Accepts all individuals regardlessof the ability to pay foremergentmedicallynecessaryserviceswithin the scopeof thehospital’sservice.

(2) Seekscollectionof aclaim, including collection from an insurer~ paymentarrangementswith the person who is responsible forpaymentof thecarerendered.

(3) Attemptsto obtain healthcare coveragefor patients,includingassistingpatients in applying for medical assistance,the Children’sHealth InsuranceProgram or the Adult Basic Coverage InsuranceProgramestablishedin section1303(a),whenapplicable.

(4) Ensuresthat anemergencyadmissionor treatmentis not delayedor denied pending determination of coverageor requirement forpirepaymentor deposit.

(5) Postsadequatenoticeof the availability of medicalservicesandtheobligationsof hospitalsto providefreeservices.

(6) Providesdatatothecouncil in accordancewith section1103.(c) Uncompensatedcare scoring.—The departmentshall annually

calculate the uncompensatedcare score of each eligible hospital fromcollecteddata. If information necessaryto determinethe uncompensatedcarescore of an eligible hospital is unavailabledue to the refusalof thehospitalto providethe information, the hospital shall not be eligible forpayment from the Hospital UncompensatedCare Program. If thedepartmentdetermines that such data cannot be provided after duediligence, the departmentshall use the averageof the collecteddata. Aneligible hospital’s uncompensatedcare score shall be the sum of thefollowing, usingthree-yearaveragedataas determinedby thedepartment:

(1) The amountof uncompensatedcareprovidedasa percentageofnetpatientrevenuebasedon the most recenthospitalfinancial analysisdatareportedto the council in accordancewith the actof July 8, 1986(P.L.408,No.89),known astheHealthCareCostContainmentAct.

(2) The number of Medicare SSI days as a percentageof totalinpatientdaysbasedon themostrecentdataavailableto thedepartment.

(3) Thenumberof medicalassistancedaysas a percentageof totalinpatientdaysbasedon themostrecentdataavailableto thedepartment.(d) Paymentcalculation.—Apaymentto aqualified hospital shallbe

calculatedasfollows:(1) Multiplying eachqualified hospital’suncompensatedcarescore

by thethree-yearaverageof its total reportedinpatientdays.(2) Dividing the product under paragraph(1) for each qualified

hospitalby the sum of the productsunderparagraph(1) for all qualifiedhospitals.

(3) Multiplying the quotient under paragraph(2) by the moneysavailablefor the Hospital UncompensatedCareProgram.(e) Limitations.—Exceptasstatedin section1106:


(1) In no caseshallthe sumof paymentsto aqualifiedhospitalunderthis sectionandpaymentsunder themedical assistanceprogramexceedtheaggregatecostof theinpatientandoutpatientservicesfurnishedto:

(i) recipientsentitled to medicalbenefitsunderTitle XIX of theSocialSecurityAct (49Stat.620,42 U.S.C.§ 1396etseq.);

(ii) recipientsentitled to medical benefitsunder section441.1 oftheactof June13, 1967(P.L.31,No.21),knownasthe PublicWelfareCode;and

(iii) patientsreceivinguncompensatedcare.(2) In no caseshallpaymentsmadeunder this sectionin afiscal year

exceedtheamountofmoneyavailableto thedepartmentfor the HospitalUncompensatedCareProgramfor thatfiscalyear.

(3) In no caseshall paymentunder this section constituteanentitlementderivedfrom the Commonwealthor a claim on any otherfundsof theCommonwealth.

(4) In no caseshallpaymentunderthissectionto aqualifiedhospitalexceedthe hospital’sannualuncompensatedcareamountas providedinthecouncil’smostrecentlypublishedhospitalfinancialreport.(1) Three-yearaverage.—Forpurposesof thissection,for fiscal yearsup

to and including 2002-2003, the term “three-year average” shall bedeterminedby the department.For fiscal years2003-2004and thereafter,the term “three-year average”shall be the averageof the immediatelyprecedingthreeyears.

(g) Mergersandseparations.—Thedepartmentshallcombinepaymentsfor hospitalswhich havemergedinto a single entity. The departmentshallfairly allocate paymentsfor a hospitalwhich separatedinto two or moreentities,asappropriate.Section1105. Reimbursementfor extraordinaryexpense.

(a) Programestablishment.—Thereis establishedin the departmentaHospitalExtraordinaryExpenseProgram.Appropriationsto thedepartmentfor the Hospital Extraordinary Expense Program pursuant to section1106(b)shall be usedto reimbursehospitalsfor extraordinaryexpensesintreatingtheuninsuredonan inpatienthospitalbasis.

(b) Departmentresponsibilities.—Thedepartmenthas the followingpowersandduties:

(1) AdministertheHospitalExtraordinaryExpenseProgram.(2) Collect the datanecessaryto administerthis section,including

datafrom thecouncil.(3) Contactthe appropriatedatasourceif thereis missingdataand

obtainthenecessaryinformation.(4) Determinethe eligibility of hospitalsfrom informationcollected

underparagraph(2).(5) Payeligiblehospitalsby October 1 of eachfiscal yearanamount

consistentwith subsection(d).


(6) Seek Federal matching funds under the medical assistanceprogramto supplementpaymentsunderthis chapter.

(7) Prepareandsubmita reportno later thanNovember30, 2002,andannually thereafterto the chair and minority chairof the PublicFLealth andWelfare Committeeand the chairandminority chairof theAppropriationsCommitteeof the Senateand the chair and minoritychairof the Health andHumanServicesCommitteeandthe chairandminority chair of the Appropriations Committee of the House ofRepresentatives.The annual report shall also be made available forpublic inspectionandbepostedon the department’spublicly accessibleWorld WideWeb site.The reportshall list all of thefollowing:

(i) The name,addressand paymentamount for each eligiblehospital.

(ii) Thehealthsystemaffiliation of eacheligiblehospital.(iii) Themethodologyanddatautilized to determinetheeligibility

of eachhospital.(c) Eligibility.—

(1) Except as provided in paragraph(3), a hospital may receivepaymentunder thissectionif the hospitaldoesnot qualify for paymentundersection 1104 and the hospital provideduncompensatedcareto apatientwith extraordinaryexpensesin the most recentfiscal year forwhich dataisavailable.

(2) A hospitalreceivingpaymentunder this sectionshallmeetall therequirementsof section1104(b).

(3) A hospitalmayelectto receivepaymentunderthis sectionin lieuof paymentundersection1104.(d) Paymentmethodology.—Paymentto a hospital under this section

shallequalthe lesserof thecostof:(1) theextraordinaryexpenseclaim;or(2) the prorated amount of each hospital’s percentageof

extraordinaryexpensecosts as compared to all eligible hospitals’extraordinaryexpensecosts,asappliedto the total fundsavailablein theHospital ExtraordinaryExpenseProgramfor thefiscal year.(e) Limitations.—Exceptasprovidedin section1106:

(1) In no caseshallpaymentsto a hospitalunderthis sectionexceedthe aggregatecostof servicesfurnishedto patientswith extraordinaryexpenses.

(2) In no caseshall the aggregateamount of extraordinaryexpensepaymentsin anyfiscalyearexceedtheamountof the appropriationtothedepartmentfor the Hospital Extraordinary Expense Program. Theprovisionof extraordinaryexpensepaymentsunder this sectionshallnotconstitutean entitlementderivedfrom theCommonwealthor a claimonanyotherfundsof theCommonwealth.

Section1106. Amounts.


(a) Generalrule.—Thetotal amount of funds receivedby a hospitalunder this chapter shall not exceed the uncompensatedcare amountreportedto thecouncil.

(b) Allocation.—Ofthe fundsappropriatedfor this chapter,85% shallbeusedfor paymentsto hospitalsundersection 1103,and 15%shallbeusedfor paymentsto hospitalsundersection1105.Section1107. Federalfunds.

The departmentshall seek to maximize any Federalfunds, includingTitle XIX of the Social SecurityAct (49 Stat. 620, 42 U.S.C. § 1396 etseq.),availablefor the Hospital UncompensatedCare Programand theHospitalExtraordinaryExpenseProgram.Section1108. Penalties.

(a) Assessment.—Thedepartmentmay assessan administrativepenaltyagainstahospitalwhich negligentlyviolatesa requirementset forth in thischapter.

(b) Amount.—Theamountof thepenaltyshallbe:(1) not morethan$25,000for ahospitalwith lessthan100beds;and(2) not morethan$50,000for ahospitalwith atleast100beds.

(c) Procedure.—Apenaltyunderthissectionis subjectto 2 Pa.C.S.Chs.5 Subch.A (relating to practiceandprocedureof Commonwealthagencies)and 7 Subch. A (relating to judicial review of Commonwealthagencyaction).

CHAPTER 13HEALTH INVESTMENT INSURANCE

Section1301. Scope.Thischapterdealswithhealthinvestmentinsurance.

Section1302. Definitions.The following wordsandphraseswhen usedin this chaptershall have

the meanings given to them in this section unless the context clearlyindicatesotherwise:

“Benefit package.” Insurancecoveragewhich providesthe benefitssetforth in section1303(fX2) for eligible adults.

“Contractor.” An insureror other entity or its subsidiariesoperatingunder40 Pa.C.S.Ch. 61 (relating to hospital plan corporations)or 63(relatingto professionalhealthservicesplancorporations),or both.

“Department.” TheInsuranceDepartmentof theCommonwealth.“Eligible adult.” A low-incomeadultwhomeetsall of thefollowing:

(1) Legallyresideswithin the UnitedStates.(2) Has beendomiciled in this Commonwealthfor at least90 days

prior to enrollment.(3) Isnot coveredby ahealthinsuranceplan,aself-insuranceplanor

aself-fundedplan.(4) Has not beencoveredby ahealthinsuranceplan,aself-insurance

plan or a self-funded plan during the three months immediately


preceding the determination of eligibility except when one of thefollowing apply:

(i) The low-incomeadult is eligible toreceivebenefitspursuanttothe actof December5, 1936 (2nd Sp.Sess.,1937 P.L.2897,No.!),knownastheUnemploymentCompensationLaw.

(ii) The low-incomeadult was coveredunder oneof the aboveplans but at the time of application for coverageis no longeremployed and is ineligible to receive benefits pursuant to theUnemploymentCompensationLaw.

(iii) The low-incomeadult is the spouseof apersonwho meetseitherof the exceptionsset forth in subparagraph(i) or (ii) andboththe eligible adult andthe spouseare low income and applying forcoverage.(5) Isineligible formedicalassistanceor Medicare.

“Hospital.” A hospitalas definedandlicensedunderthe actof July 19,1979 (P.L.130, No.48),knownastheHealthCareFacilitiesAct.

“Insurer.” An insurance company, association, reciprocal, healthmaintenanceorganization, fraternal benefit society or a risk-bearingpreferredproviderorganizationthat offershealthcarebenefitsandis subjectto regulationunder the actof May 17, 1921 (P.L.682,No.284), knownasThe InsuranceCompanyLaw of 1921,or the actof December29, 1972(P.L. 1701,No.364),knownastheHealthMaintenanceOrganizationAct.

“Low-income adult.” An individual whois at least 19 yearsof agebutlessthan65 yearsof ageandwhosehouseholdincomeis lessthan200%oftheFederalpovertylevel atthetimeof eligibility determination.

“Medical assistance.” The State program of medical assistanceestablishedunderthe actof June 13, 1967 (P.L.3l, No.21),known as thePublicWelfareCode.

“Medicare.” TheFederalprogramestablishedunderTitle XVIII of theSocialSecurityAct (49Stat.620,42U.S.C.§ 1395 etseq.).

“Offeror.” An insurer that submits a proposal in responseto thedepartment’srequestfor proposalsissuedpursuanttosection 1303(f).

“Preexisting condition.” A diseaseor physical condition for whichmedicaladviceor treatmenthasbeenreceivedprior to theeffectivedateofcoverage.

“Program.” The adultbasiccoverageinsuranceprogramestablishedinsection1303.Section1303. Adult basiccoverageinsuranceprogram.

(a) Programestablishment.—Thereis establishedin the departmentanadult basic coverage insurance program. Fund appropriations to thedepartmentfor the program shall be used for contractsto providebasichealth care insurancefor eligible adults and outreachactivities. Thedepartmentshall, to thegreatestextentpracticable,ensurethat all eligibleadultsin thisCommonwealthhaveaccessto theprogramestablishedin thissection.


(b) Eligible adult responsibilities.—An eligible adult seeking topurchaseadultbasiccoverageinsuranceshall:

(1) Submitanapplicationtothedepartment.(2) Payto the departmentor its contractoran amountof $30 per

month of coverage.Beginning January 1, 2003, the monthly paymentamountshallbe adjustedbasedon theannualchangein the ConsumerPrice Index for the 12 precedingmonths for which data is available.Notification of any changein the monthly paymentamount shall beprovidedtoeligible adultsparticipatingin theprogram.

(3) Be responsiblefor any required copaymentsfor health careservicesrenderedunderthebenefitpackagein subsection(f)(2).

(4) Notify the departmentor its contractorof anychangein theeligible adult’sincome.(c) Purchaseof insurance.—An eligible adult’s payment to the

departmentor its contractorunder subsection(b)(2) shall be used topurchasethebenefitpackageandshallbe receivedin a timely manner.Theappropriationsfor the programshall beusedby the departmentto pay thedifferencebetweenthepremiumcostof thebenefitpackage-andthe-eligibleadult’s payment.Subsidizationof thebenefitpackageis contingentupontheamountof theappropriationsto theprogramandlimited toeligible adults-in-compliancewith subsection(b). Nothingunderthis sectionshallconstitutean entitlementderivedfrom theCommonwealthor aclaim on any fundsoftheConunonwealth.

(d) Potentialwaiting list.—Thedepartmentshallmaintainawaiting listof eligible adultswhohaveapplied for adult basiccoverageinsurancebutwhoarenot enrolleddueto insufficient appropriations.An eligible adultonthe waiting list may purchasethe benefit packageat the monthly permemberpremiumcostnegotiatedby thedepartment.

(e) Departmentresponsibilities.—Thedepartmentshall:(1) Administer the adult basic coverageinsuranceprogram on a

Statewidebasis.(2) Enterinto contractsfor healthcareinsurancein accordancewith

62 Pa.C.S. (relating to procurement).The departmentmay awardcontractson amultipleawardbasis.

(3) Conductmonitoring,oversightandauditsof executedcontractsfor enforcementpurposes.

(4) Ensurethat the eligibility of enrolled individuals receivingsubsidizationof thebenefitpackageisredeterminedonan annualbasis.

(5) In consultation with appropriate Commonwealth agencies,monitor, review and evaluatethe insurer’s benefit packagefor theadequacy,accessibilityand availability of the servicesrequiredundersubsection(1).

(6) In consultation with appropriateCommonwealth agencies,establish and coordinate the development, implementation andsupervisionof anoutreachplan.


(7) Prepareand submit, by November 30, 2002, and annuallythereafterareport to the chairandminority chair of the Banking andInsuranceCommitteeof theSenateandto thechairandminoritychairofthe InsuranceCommitteeof theHouseof Representativesregardingthenumberof eligible adultspurchasingthe adultbasiccoverageinsurance,withageographicdistribution; theinsurersparticipatingin theprogram;thescopeof theservicesbeingprovided,thelevel of outreach;the costofthe insurance;andthe amountan eligible adult contributestoward theinsurance,including any copaymentsand adjustmentsdue to theConsumerPrice Index adjustmentfactor under subsection(b)(2). Theannualreportshallbemadeavailablefor public inspectionandpostedonthedepartment’spublicly accessibleWorld WideWebsite.(f) Requestfor proposals.—Inaccordancewith subsection(e)(2), the

departmentshall issuea requestfor proposalsfor the adult basiccoverageinsurance.Therequestshallrequire:

(1) An offeror toassurethatif selectedas acontractorit will do all ofthefollowing:

(i) Ensurethat eligible adultshaveaccessto primaryhealthcarephysiciansandnursepractitioners.

(ii) Contractwith qualified,cost-effectiveproviders,which mayinclude primaryhealth care physicians,nursepractitioners,clinicsand health maintenanceorganizations,to provide health care foreligible adultsin amannerthatbestmanagesthecostsof theservicesandutilizesotherappropriatemedicalcost-managementmethods.

(iii) Ensurethattheindividualapplyingfor coverageis aneligibleadult. If areviewof theindividual’s applicationfor coverageindicatesthat the individual is not eligible for adult basiccoverageinsurancebut maybeeligible for medicalassistance,theapplicationfor benefitsandall accompanyingdocumentationshall bepromptly transmittedtothe appropriate county assistanceoffice for a determination ofeligibility for medical assistanceor other Federal,State and localresourcesavailableto theindividual.

(iv) Not prohibit enrollmentbasedupon apreexistingconditionnor excludea diagnosisor treatmentfor the conditionbasedon thecondition’spreexistence.

(v) Providethe benefitpackageto eligible adultsconsistentwiththescopeanddurationrequirementsof therequestfor proposals.

(vi) Providean insuranceidentificationcardto eacheligible adultcoveredunderacontractexecutedunder this section.The cardshallnot identify theeligibleadultaslow income.

(vii) Requireeachprimarycarephysician providingprimarycareservices under this section to make necessaryarrangementsforadmissionto hospitalsandfor necessaryspecialtycare.

(viii) Not pay anyclaim on behalfof an eligible adultunlessallotherFederal,Stateandlocal resourcesarefirst utilized.


(2) A benefitpackagewith scopeanddurationdeterminedby thedepartmentthatincludes:

(i) Preventivecare.(ii) Physicianservices.(iii) Diagnosisand treatmentof illness or injury, including all

medically necessarycoveredservicesrelated to the diagnosisandtreatmentof sicknessandinjury andotherconditionsprovidedon anambulatorybasis,suchas laboratorytests,x-rays,wounddressingandcastingto immobilize fractures.

(iv) Inpatienthospitalization.(v) Outpatienthospitalservices.(vi) Emergencyaccidentandemergencymedicalcare.

(g) Proposals.—Uponpublicationof a requestfor proposals,an entityandits subsidiariesthatoperatesubjectto the provisionsof 40 Pa.C.S.Ch.61 (relating to hospitalplan corporations)or 63 (relating to professionalhealthservicesplancorporations),or both, shall submita proposalto thedepartmentto carryout thepurposesof this section.Upon publicationof arequestfor proposals,aninsurerdoingbusinessin this Conunonwealthmaysubmitaproposaltothedepartmenttocarryout thepurposesof this-section.

(h) Reviewing, scoring and selection of proposals.—Thedepartmentshallreviewandscoretheproposalson thebasisof all of therequirementsfor the adult basic coverage insuranceprogram. The departmentmayincludesuchother criteria in the requestfor proposalsandin the scoringand selectionof the proposalsthat the department,in the exerciseof itsadministrativeduties under this section,deems necessary:however,thedepartmentshall:

(1) Select,to the greatestextentpracticable,offerorsthat contractwith providersto providehealthcareserviceson a cost-effectivebasis.The department shall select offerors that use appropriate cost-managementmethodsthat enabletheprogramto providecoverageto themaximumnumberof eligible adultsandthat,wheneverpossible,pursueandutilize availablepublicandprivatefunds.

(2) Select,to thegreatestextentpracticable,only offerorsthat complywith all proceduresrelatingto coordinationof benefitsas requiredby-the-departmentandtheDepartmentof PublicWelfare.

(3) Selectofferorsthatlimit administrativeexpensesto nomorethan10% of the amount of anycontract. If after the first two full yearsofoperation any contractor presents documented evidence thatadministrativeexpensesare in excessof 10% of the amount of thecontract,the departmentmaymakean additionalpayment,not to exceed1% of the amountof the contract,for future administrativeexpensestothe contractor to the extent that the departmentfinds the expensesreasonableandnecessary.(i) Negotiations.—Thedepartmentshall not negotiateacontractfor a

periodin excessof threeyears.


(j) Limitation.—In no caseshall the total aggregateamountof annualcontractsenteredinto pursuantto this section exceedthe amount of theaggregateannual appropriationsto the departmentfor the adult basiccoverageinsuranceprogram.Section 1304. Accountability.

Three years after the effective date of this chapter, the InsuranceDepartmentshallconductaperformancereviewof the nsurancecontractorsselectedto provide servicesunder the Adult Basic CoverageInsuranceProgram.The performancereview shall be basedon the report preparedpursuantto sectionl303(e)(7)andshallinclude thefollowing: thestrategicgoals and objectives for the program, a determination of whether thestrategicgoalsandobjectiveswere achievedby thecontractorsandspecificmethodology for evaluating the results along with any proposedrecommendationsfor improvement.

CHAPTER 15MEDICAL ASSISTANCEFORWORKERSWITH DISABILITIES

Section1501. Scope.Thischapterdealswith medicalassistancefor workerswith disabilities.

Section1502. Definitions.The following wordsandphraseswhenused in this chaptershall have

the meaningsgiven to them in this section unlessthe context clearlyindicatesotherwise:

“Department.” The Department of Public Welfare of theCommonwealth.

“Medical assistance.” The State program of medical assistanceestablishedunderthe actof June 13, 1967 (P.L.31,No.21),known as thePublicWelfareCode.

“Medicare.” TheFederalprogramestablishedunderTitle XVIII of theSocialSecurityAct (49 Stat.620, 42 U.S.C.§ 1395 etseq.).

“Monthly income.” Themonthlyincomeof an individual asdeterminedby the Departmentof Public Welfare when determining eligibility formedicalassistance.

“Worker with a disability.” An individual who meets all of thefollowing:

(1) is atleast16 yearsof agebut lessthan65 yearsof age;(2) isemployedandreceivingcompensation;(3) is eligible to receiveSupplementalSecurity Incomeexceptfor

earningsandresourcesthat exceedthe limit establishedin section 1905of theSocialSecurityAct (49Stat.620,42U.S.C.§ 1396d(q)(2)(B));

(4) hasmonthly incomebelow250%of theFederalpovertyincomeguidelines;and

(5) hascountableresourcesequalto or lessthan$10,000.“Worker with a medically improved disability.” An individual who

meetsall of thefollowing:


(1) is atleast16 yearsofagebut lessthan65 yearsof age;(2) is employedat least40 hoursper month andis earningat least

the applicable minimum wage under section 6 of the Fair LaborStandardsActof 1938(52Stat. 1060,29U.S.C.§ 206);

(3) was previously a worker with a disability andparticipatedinmedicalassistance;

(4) hasmonthlyincomebelow 250%of the Federalpoverty incomeguidelines;and

(5) hascountableresourcesequalto or lessthan$10,000.Section1503. Medical assistancebenefitsfor workerswith disabilitiesand

workerswith medicallyimproveddisabilities.(a) Programestablishment.—Thereis establishedin the departmenta

medical assistancepurchaseprogram for workers with disabilitiesandworkers with medically improved disabilities. Appropriations to thedepartmentfrom the fund for the programshall be usedby the departmentto providemedicalassistanceto aworkerwith a disabilityor aworker withamedicallyimproveddisability.

(b) Worker with a disability or worker with a medically improveddisabilityresponsibilities.—Aworker with a disability or a worker with amedically improved disability seeking to purchasemedical assistancebenefitsshall:

(1) Paytothe departmentor its designee5%of theworker’smonthlyincomein amannertobedeterminedby thedepartment.

(2) Notify the departmentor its designeeof any changein theworker’s monthly income in a manner to be determinedby thedepartment.

(3) Failureof aworkerwith a disabilityor aworkerwith amedicallyimproveddisabilityto makepaymentsin accordancewith paragraph(1)will resultin theterminationof medicalassistancecoverage.(c) Provision of benefits.—Uponreceiptof a worker’s paymentunder

subsection(b)(l), thedepartmentor its designeeshallprovideto the workermedicalassistancebenefitsatthecategoricallyneedylevel asdefinedby thedepartment.

(d) Departmentresponsibilities.—Thedepartmentshall:(1) Administerthemedicalassistancepurchaseprogram.(2) Prepareand submit by November 30, 2002, and annually

thereaftera report to the chairandminority chairof the Public HealthandWelilire Committeeofthe Senateandthechairandminoritychairofthe Health and Human Services Committee of the House ofRepresentativeson the number of individuals purchasing medicalbenefits, the average amount paid for the benefits and any otherinformation deemednecessaryby the department.The annual reportshall be made available for public inspection and posted on thedepartment’spubliclyaccessibleWorldWideWebsite.


CHAPTER 17REGIONAL BIOTECHNOLOGYRESEARCHCENTERS

Section1701. Scope.Thischapterdealswith regionalbiotechnologyresearchcenters.

Section1702. Definitions.The following wordsand phraseswhenusedin this chaptershall have


“Biomedical research.” Comprehensiveresearchpertaining to theapplication of the natural sciencesto the study and clinical practiceofmedicine at an institution, including biobehavioralresearchrelated totobaccouse.

“Clinical research.” Patient-orientedresearchwhich involves directinteraction and study of the mechanismsof humandisease,includingtherapeuticinterventions,clinical trials, epidemiological and behavioralstudiesandthedevelopmentofnew technology.

‘Collaborativeresearch.” Peer-reviewedbiomedical,clinical or healthservicesresearchconductedjointly by two or moreapplicantsthatcooperateto identify priorities andconductresearchwhichprovidesfor the sharingofinfrastructure,resourcesandexpertise.

“Department.” The Department of Community and EconomicDevelopmentof theCommonwealth.

“Health servicesresearch.”Anyof thefollowing:(1) Researchon the promotionandmaintenanceof health,including

biobehavioralresearch.(2) Researchon thepreventionandreductionof disease.(3) Researchon the deliveryof healthcare servicesto reducehealth

risksandtransferresearchadvancesto communityuse.“Intellectualproperty.” Includes:

(1) any idea,invention,tradesecret,process,program,data,formula,patent,license,copyright or trademark;and

(2) an application, right or registration relating to any idea,invention, tradesecret,process,program,data,formula, patent,license,copyrightor trademark.“MR.” TheNationalInstitutesof Health.“Research.” Biomedical, clinical, collaborative and health services

research.Section1703. Regionalbiotechnologyresearchcenters.

(a) Establishmentof centers.—Thedepartment,in consultationwith theDepartmentof Health,shallestablishthreeregionalbiotechnologyresearchcentersto facilitateresearchthroughthesharingof fundsandinfrastructure.

(b) Nonprofit corporations to own and operate centers.—Thedepartmentshall seekapplicantsfor the purposeof forming a nonprofitcorporationtoownandoperateregionalbiotechnologyresearchcenters.


(c) Board of directors.—Eachnonprofit corporationshall establishaboard of directors consisting of at least seven but not more than 15members.TheSecretaryof CommunityandEconomicDevelopmentandtheSecretaryof Health or their designeesshall be ex officio membersof eachboardof directors.Theboardof directorsshall includerepresentativesof thefor-profit andnonprofitinstitutionsand organizationsparticipatingin theresearchcenteras well asotherrepresentativesof local, civic or communitygroups.

(d) Board chair.—The Secretary of Community and EconomicDevelopmentshall appoint the initial chairof the boardof directorswhoshall serveatermof two years.All subsequentboardchairsshallbeselectedby themembersof theboardof directorsandshallserveatermof two years.

(e) Functionsof centers.—Theregionalbiotechnologyresearchcentersshall develop and implement biotechnology research projects whichpromoteandcoordinateresearchin thisCommonwealthin orderto:

(1) Create or enhance research and related industries inPennsylvania.

(2) Develop high quality and commercially useful productsorintellectualproperty.

(3) Attract venturecapital investments.(4) Attractandretainprominentscientists.(5) Encouragetrainingandeducationalprograms.(6) Developregionalresearchspecialties.(7) Implement the commercial development of new research

discoveries.(0 Application.—Theboardof directorsof eachregionalbiotechnology

researchcenter shall submit an application to the departmentwhichincludesthefollowing:

(1) A listing of the for-profit and nonprofit institutions andorganizationsthat will comprisethe nonprofitcorporationandthatwillownandoperatetheresearchcenter.

(2) The namesand affiliations of the membersof the board ofdirectorsfor thenonprofitcorporation.

(3) Theproposedprograms,activitiesandcategoriesof researchto beconductedat thecenter.

(4) The plans for marketing the research center to regionalinstitutions and corporations to build awareness and encourageparticipation.

(5) Theproposedlocation of theresearchcenter.(6) A proposedbudgetfor thefirst yearof operationsof theresearch

center, including projected infrastructure costs and projections onpermanentstaffto beemployedattheresearchcenter.

(7) The anticipatedhealth,scientific, commercialand economicdevelopmentoutcomestobeachievedby theresearchcenter.


(8) The amount of hinds, infrastructureor other resourcesto becontributedby eachparticipantto theresearchcenter.

(9) Any otherinformationdeemednecessaryby thedepartment.(g) Agreement with department.—Theboard of directors of each

biotechnologyresearchcentershallreachanagreementwith- thedepartmentregardingall ofthefollowing:

(1) The amount of capital to be raised from the for-profit andnonprofit institutions and organizationsprior to disbursementof anyStatefunds.

(2) The processfor allowing accessto and commercializationofintellectualproperty.

(3) Theportionof biotechnologyresearchcenterearningswhichwillbereturnedto theHealthAccountdueto intellectualproperty-orproductswhich are developedas a result of researchconductedthrough theresearchcenter.All proceedsderivedfrom royalty agreementsshall bedivided equally betweenthe regional researchcenterand the HealthAccount.(ii) Contributionsand ongoing funding.—In order to participate in

researchor product developmentat a regional biotechnologyresearchcenter, financial or other substantiallyequivalent contributions to theresearchbeing conductedshall be made at a level establishedby thedepartment.Theboardof directorsshall developrevenuesources,includingroyalty agreements,to fund ongoing operationsof the biotechnologyresearchcenter.

(i) Personnel.—Aregional biotechnologyresearchcenter may hirepersonnelto coordinateresearchprojects.

(j) Reviewandreport.—(1) Eachregionalbiotechnologyresearchcentershallbesubject-toan

annualperformancereviewby thedepartment.(2) Eachregionalbiotechnologyresearchcentershall, by November

30, 2002, and annuallythereafter,prepareandsubmit a report to thedepartment,the Departmentof Health, the chairandminority chairofthe Appropriations Committeeof the Senate,the chair and minoritychairof the AppropriationsCommitteeof the Houseof Representatives,the chair and minority chair of the Community and EconomicDevelopmentCommitteeof the Senateandthechairandminority chairof the CommerceandEconomicDevelopmentCommitteeof the Houseof Representatives.This reportshallbein aform andmannerdevelopedby thedepartmentworkingin cooperationwith theDepartmentof Healthandshall includethe following:

(i) Thecurrentmembersof the boardof directorsfor the researchcenter.

(ii) A descriptionof the researchfacilities, including spaceandequipment.


(iii) The researchcenter’scurrentpolicies for the managementanddevelopmentof intellectualpropertyandownershipof inventionsandproductscreatedduring thecourseof researchconductedthroughthecenter.

(iv) Theresearchcenter’spolicies on conflicts of interestandthehandlingof confidentialmaterial.

(v) A listing of all organizationsand for-profit and nonprofitinstitutionsutilizing the servicesof the researchcenterduring theprior year.

(vi) A listing of any licensesor other contractualobligationsineffect or anticipatedfor the intellectual property developedat theresearchcenterduringtheprior year.

(vii) A listing of anyinventions,anypatentapplicationsor patentsissued,any productsor other intellectual property developedas aresult of researchconductedthroughthe researchcenterduring theprior year.

(viii) A copyof the annualoperatingbudgetfor the year,with alisting of the sourcesof all funds, including financial and in-kindservices, personnel,equipment or other material donations andcontributions by all parties involved in the researchcenter;grantsobtainedby or throughthe researchcenter;Federalfunds leveragedand expendituresmade, including infrastructureexpenditures;andadministrativeandstaffing costs.

Section1704. Applicability of standardsregardingfundedresearch.Each regional biotechnology researchcenter establishedunder this

chapter and for-profit and nonprofit institutions and organizationsparticipating in the research center shall execute a memorandumofunderstandingwith the Secretaryof Health which specifiesthat researchperformedor coordinatedby andprojectspromotedandcoordinatedby theregional biotechnologyresearchcentershall be subject to Federalethicalandproceduralstandardsof conductprescribedby the NIH on the date thememorandumof understandingis executed.Researchcentersfundedunderthis chapter shall observethe Federalethical and proceduralstandardsregulating researchand researchfindings, including publications andpatents,which are observedunder NIH extramuralfunding requirementsandNIH grantspolicy statementsandapplicablesectionsof 45 CFRPt. 74(relating to uniform administrativerequirementsfor awardsandsubawardsto institutionsof highereducation,hospitals,othernonprofitorganizations,and commercialorganizations;and certain grantsand agreementswithStates, local governmentsand Indian tribal governments)and Pt. 92(relatingto uniform administrativerequirementsfor grantsandcooperativeagreementstoStateandlocal governments).

CHAPTER 19HEALTHLINK


Section1901. Scope.Thischapterdealswith theHealthLinkProgram.

Section 1902. Definitions.The following wordsandphraseswhenusedin this chaptershall have


“Department.”TheDepartmentof Health of theCommonwealth.“Hospital.” A health care facility providing medical and surgical

servicesandlicensedas ahospitalby the Departmentof Healthundertheactof July 19, 1979 (P.L.130, No.48),known as the HealthCareFacilitiesAct.

“Program.” TheHealthLinkProgramestablishedin section1903.Section 1903. HealthLinkProgram.

(a) Program established.—TheHealthLink Program is herebyestablishedasamedicalandsurgicalequipmentgrantprogramfor hospitalseligible undersubsection(c).

(b) Programdescription.—Theprogramshall provide grants for thepurchaseof medical and surgical equipmentused in the diagnosisandtreatmentof patients and for reimbursementof expensesrelated to thepurchaseof suchequipment.

(c) Eligibility.—To beeligible for agrantunder theprogram,ahospitalmustmeetall of the following:

(1) Be locatedin acountyof thesixth, seventhor eighthclass.(2) Submitan applicationto thedepartmentdescribingtheequipment

to bepurchasedandits intendedpurpose.(3) Providematchingfunds in the amountof 100%of theamountof

ihe grant.(d) Departmentduties.—Thedepartmentshall:

(1) Administer the programandawardgrantsfrom the accountbyestablishingproceduresand utilizing forms as may be necessarytoimplement the program. A grant to an individual hospitalunder theprogramshall not exceed$500,000.A grantmaybeextendedover twoStatefiscal yearsat therequestof thegrantrecipient.

(2) Audit each grant recipient to ensurethat funds are used inaccordancewith program requirements.Grantrecipientsshall provideinformationrelatingto theexpenditureof moneysin theformatspecifiedby the department.

(3) Reportto the Governorandthe chairandminority chairof thePublic Health andWelfareCommitteeof the Senateandthe chair andminority chair of the Health and Human Services Committeeof theHouse of Representativeson the grants awarded, the impact on thegranteesand the amount of funds spent. The report shall be dueNovember 30, 2002. The report shall be made available for publicinspection and postedon the department’spublicly accessibleWorldWideWebsite.


Section1904. Duties.A hospitaleligible for a grant underthis chaptershall agreeto provide

medicallynecessaryservicesto individuals regardlessof the individual’sability to payfor such servicesandbe a participatingprovider with theDepartmentof Public Welfare for servicesprovidedto personseligible formedicalassistance.

CHAPTER21COMMUNITY-BASED HEALTH CAREASSISTANCE

Section2101. Scope.This chapterdealswithcommunity-basedhealthcareassistance.

Section2102. Definitions.The following wordsand phraseswhenusedin this chaptershall have

the meaningsgiven to them in this section unless the Context clearlyindicatesotherwise:

“Collaborative.” An entity locatedin this Commonwealththatprovidesan integrateddelivery systemfor coordinatinghealthcare and outreacheffortsunderthischapter.

“Community-basedhealth care provider.” Any of the followingnonprofithealthcarecenterslocatedin thisCommonwealthwhich provideprimaryhealthcareservices:

(1) A “federally qualified health center” as defined by section1861(aa)(4)of the Social Security Act (49 Stat. 620, 42 U.S.C.§ 1395x(aa)(4)).

(2) A “rural healthclinic,” as definedby section 1861(aa)(2)of theSocialSecurityAct (49 Stat.620,42 U.S.C.§ 1395x(aa)(2)),certifiedbyMedicare.

(3) A freestandinghospital clinic serving a federally designatedhealthcareprofessionalshortagearea.

(4) A free or partial-payhealthclinic which providesservicesbyvolunteermedicalproviders.“Department.”TheDepartmentof Healthof theCommonwealth.

Section2103. Community-BasedHealthCareAssistanceProgram.(a) Establishment.—Thereis establishedin the department the

Community-BasedHealthCareAssistanceProgram.Subsection(c) shallbeadministeredby the department with the advice of the InsuranceDepartmentandtheDepartmentof PublicWelfare. Appropriationsfrom thefundto thedepartmentshallbeusedto implementtheprogram.

(b) Purpose.—Thepurposeof the programis to support community-basedhealthcare providersand coflaborativesin locating, assessingandmanaginghealthcarefor low-incomePennsylvaniansandto improveaccessto andthe delivery of preventative,curative andpalliativehealthcaretotheseindividuals.


(c) Grants for coordinationand outreach.—Agrant, not to exceed$350,000,shall beavailableto acommunity-basedhealthcareprovider or acollaborativethatmeetsall of thefollowing:

(1) Identify and assessthe general health statusof low-incomeindividuals with or at risk for chronic diseasesandprovideenrollmentassistanceto these individuals for available health benefit insuranceprograms.

(2) Providecasemanagementservicesto low-incomeindividualstoimprovetheirphysicalhealth,behavioralhealthandsocialconditionandto reducemedicalcomplications.

(3) Referandcoordinatecarefor individualswhorequireadditionalhealthcareservices.

(4) Reducethe inappropriateuseof hospitalemergencydepartmentsandhospitalinpatientstaysby personswhoarechronicallyill.

(5) Educate patients, medical providers, caregivers and thecommunityon thecoordinatedmanagementof chronicdiseases.

(6) Developregional,nonprofit, community-basedintegrateddeliverysystemscapableof carryingout thepurposesandgoalsspecifiedin thissubsection.(d) Grantsfor resources.—.Grantsshallbeavailabletocommunity-based

healthcareprovidersto increaseaccessand to improve the delivery andqualityof healthcareby developingandmaintainingnecessarycommunity-basedhealthcareresources.A grantunderthissubsectionshall not exceed$100,000.

(e) Application.—An applicationfor agrantunderthis sectionshallbeevaluatedby the departmentto determineits merit in achieving thepurposessetforth in subsections(c) and(d) throughthestrategicgoalsandobjectives set forth in the application. The departmentshall provideapplicationsfor grantsunder this section to all known community-basedhealthcareprovidersandcollaboratives.A grantunderthissectionmaybeextendedover two Statefiscal yearsatthe requestof the community-basedhealthcareprovideror collaborative.

(1) Report.—(1) A community-basedhealth care provider or collaborative

receivinga grant underthis section shall report to the department,asspecifiedby thedepartment,on all of thefollowing:

(i) The progressof its efforts to improve the delivery andmanagementof healthcareto low-incomepersons,as measuredbythegoalsandobjectivesdevelopedby thedepartment.

(ii) Documentationof thereductionof unnecessaryandredundanthealthcareservicestosuchpersons.

(iii) Thedatanecessaryfor evaluationof the programsas definedby thedepartment.(2) Thedepartmentshall providea report to thechair andminority

chair of thePublic HealthandWelfareCommitteeof the Senateandthe


chair andminority chairof the HealthandHumanServicesCommitteeof the Houseof Representatives.Thereport shall be dueNovember30,2002.Thereportshallincludealist of thegrantsawarded,theimpactonthe entities which received the grants, the impact of the grant onimproving the deliveryandqualityof healthcarein thecommunityandthe amountof fundsspent.Thereportshallbemadeavailablefor publicinspection and postedon the department’spublicly accessibleWorldWideWebsite.

CHAPTER23PACEREINSTATEMENT AND PACENETEXPANSION

Section2301. Scope.Thischapterdealswith PACEreinstatementandPACENETexpansion.

Section2302. Definitions.The following wordsandphraseswhenusedin this chaptershall have


“Department.”TheDepartmentof Aging of theCommonwealth.“Income.” All incomefrom whateversourcederived,including,but not

limited to, salaries, wages, bonuses,commissions, income from self-employment,alimony,supportmoney,cashpublic assistanceandrelief, thegrossamount of any pension or annuities,including railroad retirementbenefits,all benefitsreceivedunderStateunemploymentinsurancelawsandveterans’ disability payments, all interest received from the FederalGovernmentor any state governmentor any instrumentalityor politicalsubdivisionthereof,realizedcapital gains,rentals,workers’ compensationand the gross amount of loss of time insurancebenefits,life insurancebenefitsandproceeds,exceptthe first $5,000of the total of deathbenefitspayments,andgifts of cashor property,otherthantransfersby gift betweenmembersof a household,in excessof a total valueof $300,but shall notincludesurplusfoodor otherrelief in kind suppliedbyagovernmentagencyor propertytax rebate.

“Program.” The PharmaceuticalAssistanceContractfor the ElderlyNeedsEnhancementTier programestablishedundersection 519(a)of theactof August26, 1971 (P.L.351, No.91), knownastheStateLotteryLaw.

“Qualified individual.” A residentof this Commonwealthfor no lessthan90 dayswhomeetsall of thefollowing:

(1) Isnot aneligible claimantasdefinedundersection502of the actof August26, 1971 (P.L.351,No.91),knownasthe StateLottery Law.

(2) Is65 yearsof ageor older.(3) Has an annual incomewhich is not lessthan$16,001 andnot

more than $17,000in the caseof a single person,andnot less than$19,201andnot morethan$20,200in thecaseof thecombinedincomeof personsmarriedto eachother.A personmay, in reportingincometothe department,round the amountof eachsource of income and the


incometotal to the nearestwholedollar. Any amountwhich is lessthan500 shallbeeliminated.

(4) Is not otherwisequalified for public assistanceunderthe actofJune13, 1967 (P.L.31,No.21),knownasthe PublicWelfareCode.

(5) Applies forpharmaceuticalassistanceunderthe actof August26,1971 (P.L.351,No.91),knownastheStateLotteryLaw.

Section2303. Additional eligibility.A qualified individual shallbeeligible for participationin theprogram.

Section2304. Deductiblesandcopayments.Uponenrollmentin theprogram,aqualified individual shallberequired

to meettheannualdeductibleandto satisfythe copaymentprovisionsof theprogramin section5 19(c) and(d) of the actof August26, 1971 (P.L.351,No.91), known as the StateLottery Law. To qualify for the deductiblesetforth in section519(c), theprescriptiondrug mustbepurchasedfor theuseof thequalified individual from aproviderasthatterm is definedin Chapter5 of theStateLotteryLaw.Section2305. Applicationof otherPACENETprovisions.

Any other provisions of Chapter5 of the act of August 26, 1971(P.L.351, No.91), known as the State Lottery Law, which apply to thePACENETprogramshallapplyto theexpansionof the PACENETprogramcontainedin this chapter.Section2306. PACEreinstatement.

Notwithstandinganyotherprovisionof law tothecontrary,personswho,as of December31, 2000, wereenrolledin thePACE programestablishedpursuantto the actof August 14, 1991 (P.L.342, No.36), known as theformer Lottery FundPreservationAct, shall remaineligible for the PACEprogramif the maximumincome limit is exceededduesolely to aSocialSecuritycost-of-livingadjustment.Any personwhosePACE eligibility hasbeenterminatedfor thiscauseshallbe retroactivelyreinstatedcommencingon the effective date of this section. Eligibility in the PACE programpursuantto thissectionshallexpireon December31,2002.Section2307. Limitations.

Thereceiptof benefitspursuantto the programunder this chaptershallnot constituteanentitlementderivedfrom theCommonwealthor aclaim onanyfundsof theCommonwealth.Section2308. PACEstudy.

The Secretaryof Aging shall conduct a study of the PACE andPACENETprogramestablishedunderChapters5 and7 of theactof August26, 1971 (P.L.351,No.91),known asthe StateLottery Law. Thestudyshallbe conductedby an advisorycommittee comprisedof the SecretaryofAging, the Secretaryof Public Welfare, senatorsappointedby the MajorityLeaderof theSenateandtheMinority Leaderof the Senate,representativesappointedby theMajority Leaderof the Houseof RepresentativesandtheMinority Leaderof the House of Representativesand other membersasselectedby theSecretaryof Aging. Thecommitteeshallreviewmethodsand

SESSIONOF 2001 Act2001-77 805

practices to reduce the cost of theseprogramsto the Commonwealth,including bestprice, Federalupper limits, therapeuticinterchangeabilityandsteptherapy.The Secretaryof Aging shall submitrecommendationstotheGeneralAssemblyby October1, 2001.

CHAPTER25PENNSYLVANIA MEDICAL EDUCATIONLOAN ASSISTANCE

Section2501. Scope.Thischapterdealswith medicaleducationloanassistance.

Section2502. Definitions.The following words andphraseswhenusedin this chaptershall have

the meanings given to them in this section unlessthe context clearlyindicatesotherwise:

“Accreditedmedicalcollege.” An institutionof highereducationlocatedin this Commonwealththat is accreditedby the Liaison CommitteeonMedicalEducationto providecoursesin medicineand empoweredto grantprofessionaland academicdegreesin medicineas definedin the act ofDecember20, 1985 (P.L.457,No.112),known as theMedical PracticeActof 1985.

“Agency.” ThePennsylvaniaHigherEducationAssistanceAgency.“Approved institution of higher learning.” An institution of higher

learninglocatedin thisCommonwealthandapprovedby theagency.“Approved nursing program.” An institution located in this

Commonwealthandaccreditedto grantprofessionalandacademicdegreesor diplomasin nursing as definedin the actof May 22, 1951 (P.L.317,No.69),knownasTheProfessionalNursingLaw.

“Degreein medicine.” A degreefrom anaccreditedmedicalcollegethatqualifiesthedegreerecipienttobelicensedasaphysician.

“Designatedarea.” Anyof thefollowing:(1) A geographicareaof this Commonwealththat is designatedby

the Secretaryof Healthashavingashortageof physicians.(2) A geographicareaof this Commonwealthdesignatedby the

United StatesDepartmentof HealthandHumanServicesasamedicallyunderservedarea or designatedto have a medically underservedpopulation.“Eligible applicant.” An individual whoholdsan undergraduatedegree

from aninstitution of higher learningandis enrolledin:(1) an accreditedmedicalcollege;or(2) an approved institution of higher learning for purposesof

obtainingagraduatedegreein biomedicineor life sciences.“Guarantor.” An insurancecompanyor not-for-profit guarantorwhose

primarypurposeis to providedefaultcoverageandlosspreventionservicesto anofferorof unsecuredstudentloans.

“Offeror.” An institutionthat makesunsecuredloansto eligible studentsin cooperationwith theagency.


“Nursing school applicant.” An individual who is a residentof thisCommonwealthandis enrolledin anapprovednursingprogram.

“Physician.” An individual licensedto practicemedicineand surgerywithin thescopeof theactof December20, 1985 (P.L.457, No.112),knownas the Medical Practice Act of 1985, or the act of October 5, 1978(P.L.1109, No.261),known astheOsteopathicMedical PracticeAct.

“Registerednurse.” An individual licensed to practiceprofessionalnursing under the act of May 22, 1951 (P.L.317, No.69), known as TheProfessionalNursingLaw.Section2503. PennsylvaniaMedicalEducationLoanAssistanceProgram.

The agencyshall establishand administerthe PennsylvaniaMedicalEducationLoanAssistanceProgramassetforth in sections2504and2505to provide financial assistanceto individuals who acquire the requireddegreeor diploma in medicine,professionalnursing,biomedicineor lifesciencesand to recruit these individuals to practicetheir professionsinPennsylvania.Section2504. Loan guarantorprogram.

(a) Establishmentof program.—Theagency shall administera loanguarantorprogramon a Statewidebasis.The agencyshall utilize funds intheMedicalSchoolLoan Account to encourageeligible applicantstc~attendanaccreditedmedicalcollegeor an approvedinstitution ofhigher learning.

(b) Loan GuarantorProgram.—TheLoan GuarantorProgramshallprovidefor thefollowing:

(1) Life of loanservicing.(2) Contractingfor insurancewith a guarantor,approvedby the

agency,which offersa low-costloan with competitiveinterestratesandloanfeestoeligible applicants.

(3) Predeterminingthe eligibility of applicantswho receivea loanfrom an offeror to attendan accreditedmedicalschool or an approvedinstitutionof higherlearningthatis insuredbyaguarantor.

(4) Evaluating the benefit packageof a guarantor for adequacy,accessibilityandavailabilityof fundsnecessaryto provideadequatelossprevention.(c) Low-cost loans.—Aneligible applicantshallapplyto anofferor for a

low-cost loan to attend an accreditedmedical college or an approvedinstitution of higher learning.A low-cost loanmadeunder this subsectionshall be guaranteedby an approvedguarantorthrougha contractwith theagency.Low-cost loansmadeunder this subsectionshall providereducedinterestratesandloanfeesto eligibleapplicantscomparedtoloansmadeforthesamepurposethat arenotguaranteedby thischapter.

(d) Loan requirements.—Loansprovidedunder this sectionshallcoverup to 100%of the actualcostof tuition, room andboardat an accreditedmedicalcollegeor an approvedinstitution of higher learningandthe actualcostof course-requiredtextbooksandsuppliesfor therecipient.


(e) Default.—If a recipient fails to repay a loan receivedunder thissection,theagencyshallcollecttheloanpursuanttooneof thefollowing:

(1) Section 4.3 of the actof August 7, 1963 (P.L.549, No.290),referred to as the PennsylvaniaHigher EducationAssistanceAgencyAct.

(2) A processestablishedby theapplicableguarantors.(3) Any othercollectionprocedureor processdeemedappropriateby

the agency.(f) Medical Education Loan Loss Account.—An account is hereby

establishedWithin the agencyto receivefundsappropriatedfor purposesofthissection.Moneysin theaccountareherebyappropriatedto theagencytoprovide the loan guarantorprogram. When funds in the account areexpended,no additionalloansshallbeoffered.

(g) Interestratereduction.—Theagencyor an offerormaymodifyloansunderthissectionto furtherreduceinterestratesasfollows:

(1) Theagencyor theofferormayreducetheinterestrateof theloanby not lessthan 1% if the loanrecipient,upon completionof agraduatedegreein biomedicineor life sciencesor upon licensureasa physician,agreesto practicemedicineor beemployedtoconductresearchon a-full-timebasisinPennsylvaniafor aperiodof threeconsecutiveyears.

(2) Theagencyor theofferormayreducethe interestrateof theloanby not lessthan2% if the loanrecipient,upon licensureas a physician,agreesto practicemedicinefor not lessthanthreeconsecutiveyearsin adesignatedarea.(h) Contract.—Inaddition to the requirementsof subsection(g), in

ordertobeeligible for an interestratereduction,a loanrecipientshallenterinto acontractwith the agencyor anofferor or its assignsat the timetheloan is made.Thecontractshall includethefollowing:

(1) The loan recipientpracticingin a designatedareashall agreetotreatpatientseligible formedicalassistanceandMedicare.

(2) The loan recipient shall permit the agencyor the offeror tomonitortherecipient’spracticeor employmentto determinecompliancewith thetermsof thecontractandthischapter.

(3) The agency shall certify compliancewith the terms of thecontract.

(4) Uponthe loan recipient’sdeathor total or permanentdisability,the agencyor the offeror shall nullify the service obligation of therecipient.

(5) If the loanrecipientis convictedof or pleadsguiltyor no contestto afelony or if the licensingboardhasdeterminedthattherecipienthascommitted an act of gross negligencein the performanceof serviceobligationsor has suspendedor revoked the licenseto practice, theagencyor theofferor shall terminatetheloanrecipient’sparticipationintheprogramandseekrepaymentof theamountof the loanon the dateoftheconviction,determination,suspensionor revocation.


(6) A loan recipientwhofails to complywith a contractshall paytotheagencyor theofferor the amountof loanreceivedunder theoriginalcontract as of the time of default. Providing false information ormisrepresentationon an application or verification of service shallconstitutedefault.(i) Accountability.—Threeyearsafter theeffective dateof thischapter,

theagencyshallconducta performancereviewof theprogramand servicesprovided.Theperformancereviewshallincludethefollowing:

(1) thegoalsandobjectivesof theprogram;(2) adeterminationof whetherthegoalsandobjectiveswereachieved

by theagencyparticipatingguarantorandofferor;(3) thespecificmethodologyusedto evaluatetheresults;and(4) recommendationsfor improvement.

Section2505. Loanforgivenessprogram.(a) Establishmentof program.—Theagency shall administera loan

forgivenessprogramfornursingschoolapplicantson aStatewidebasis.Theagencymay provide loan forgivenessas provided in subsection(b) forrecipientsof loans who by contractwith the agency agreeto practiceprofessionalnursingin thisCommonwealthuponattainmentof therequiredlicense.

(b) Loan forgiveness.—Agency-administered,federally insuredstudentloansfor higher educationprovidedto a nursingschool applicantmaybeforgivenby the agencyasfollows:

(1) Theagencymayforgive50% of the loan,not to exceed$50,000,if a loanrecipiententersinto acontractwith the agencythatrequirestherecipientupon successfulcompletion of an approvednursing programand licensure as a registered nurse to practice nursing in thisCommonwealthfor aperiodof not lessthanthreeconsecutiveyears.

(2) Loan forgivenessawardsmadepursuantto paragraph(1) shallbeforgivenover aperiodof threeyearsatan annualrateof 33 1/3%of theawardandshallbemadefrom fundsappropriatedfor thispurpose.

(3) Thecontractenteredinto with the agencypursuantto paragraph(1) shall be considereda contractwith the Commonwealthandshallincludethefollowing terms:

(i) An unlicensedrecipient shall apply for a registerednurse’slicenseto practicein this Commonwealthat the earliestpracticableopportunityuponsuccessfullycompletingadegreein nursing.

(ii) Within six monthsafter licensure,arecipientshall engageinthepracticeof nursingin this Commonwealthaccordingto the termsof theloanforgivenessaward.

(iii) Therecipientshallagreeto practiceon afull-time basis.(iv) Therecipientshallpermittheagencytodeterminecompliance

with thetermsof thecontract.(v) Upon therecipient’sdeathor total or permanentdisability, the

agencyshallnullify the serviceobligationof therecipient.


(vi) If therecipientis convictedof or pleadsguiltyor no contesttoafelony or if the licensingboardhasdeterminedthattherecipienthascommittedan actof grossnegligencein the performanceof serviceobligationsor hassuspendedor revokedthe licenseto practice,theagencyshallhavethe authorityto terminatetherecipient’sserviceinthe programanddemandrepaymentof the amountof the loan as ofthedateof theconviction,determination,suspensionor revocation.

(vii) Loanrecipientswho fail to beginor completetheobligationscontractedfor shallpayto theagencythe amountof the loanreceivedunder the terms of the contractpursuantto this section. Providingfalse information or misrepresentation on an application orverification of serviceshall bedeemeda default. Determinationas tothetimeof defaultshallbemadeby theagency.(4) Notwithstanding42 Pa.C.S.§ 8127 (relating to personalearnings

exemptfrom process),the agencymay seekgarnishmentof wagesinorderto collecttheamountof theloanfollowing defaultunder~paragiaph(3)(vii).

Section2506. Limitations.The receipt of a loan under this chapter shall not constitute an

entitlementderivedfrom theCommonwealthor aclaim onany fundsof theCommonwealth.Section2507. Regulations.

The agencymay adopt regulationsas are necessaryto carry out theprovisionsofthis chapter.

CHAPTER27MISCELLANEOUSPROVISIONS

Section2701. Definitions.The following wordsandphraseswhenusedin this chaptershall have


“Participating manufacturer.” As defined in the Master SettlementAgreement.

“Releasedclaim.” As definedin theMasterSettlementAgreement.Section2702. Disbursementto counties.

(a) Counties.—Ifacountymaintainsor financially supportsan actionatlaw or in equity againsta participatingmanufacturerfor a releasedclaim,no moneyavailableasaresultof the MasterSettlementAgreementshallbedisbursedto anyentity Within the countyuntil the action is withdrawn ordismissed.

(b) Otherpolitical subdivisions.—Ifapolitical subdivisionother thanacounty maintainsor financially supportsan action at law or in equityagainst a participating manufacturerfor a releasedclaim, no moneyavailableasa resultof the MasterSettlementAgreementshall bedisbursed


to any entityin thecountyin which thepolitical subdivisionis locateduntiltheactionis withdrawnor dismissed.Section2703. Prohibition.

(a) Generalrule.—Recipientsof fundsunderthis actareprohibitedfromusingthesefundsfor lobbyingactivities.

(b) Definition.—Asusedin this section,the term “lobbying activities”meanseffortsto influenceStateor local legislativeactionor administrativeaction.Thetermincludesdirector indirectcommunication.

CHAFFER51APPROPRIATIONS

Section5101. One-timeappropriationsfor 2001-2002.(a) Tobaccosettlementfunds.—Thefollowing sums,or asmuchthereof

as maybenecessary,areherebyspecificallyappropriatedfrom theTobaccoSettlementFundfor thefiscal year2001-2002:

(1) Governor.—The following amountsGovernor:

For transferto the TobaccoEndowmentAccount.

Stateappropriation(2) Department of Community and

Economic Development.—.The followingamountsareappropriatedto the Departmentof CommunityandEconomicDevelopment:

For transferto the Health VentureInvestment Account pursuant to section305(1)and(g).

StateappropriationFor regional biotechnology research

centerspursuantto Chapter17.Stateappropriation

(3) Department of Health.—Thefollowing amountsare appropriatedto theDepartmentof Health:

For grantsfor the purchaseof medicalandsurgicalequipmentpursuantto Chapter19.

Stateappropriation 20,000,000For grants for the community-based-

healthcare assistanceprogrampursuanttoChapter21.

Stateappropriation 25,000,000(4) Departmentof PublicWelfare.—The

following amountsare appropriatedto the

are appropriated to theFederal State

25,783,000

Federal State

60,000,000

100,000,000

Federal State


Departmentof PublicWelfare:For hospitaluncompensatedcarepur-

suantto sections1103 and1104.Stateappropriation

(5) Pennsylvania Higher EducationAssistance Agency.—The followingamounts are appropriated to thePennsylvaniaHigher Education AssistanceAgency:

For low-costloansto medicalschoolstudents and graduate students inbiomedicine or life sciencespursuant toChapter25.

Stateappropriation 5,000,000For low-cost loans andloan forgiveness

for nursing school students pursuant toChapter25.

Stateappropriation 3,000,000(b) Federalfimds.—Jnaddition, any Federalfunds receivedfor any

programsreferredto in subsection(a) areherebyspecificallyappropriatedtothoseprograms.

(c) Lapsing.—All appropriationsin this sectionshalllapseon June30,2002,exceptfor thefollowing:

The appropriationsto the Departmentof Health for grants for thepurchaseof medicaland surgical equipmentpursuantto Chapter19 andgrantsfor the community-basedhealthcareassistanceprogrampursuanttoChapter21 shall lapseon June30,2003.

(d) Transfer—Thesum of $68,508,000is transferredfrom the fund totheGeneralFundfor health-relatedprograms.Section5102. Sunset.

Section5101 shallexpireJune30,2003.Section5103. Effectivedate.

This act shall take effect July 1, 2001, or immediately,whichever islater.

APPROVED—The26thdayofJune,A.D. 2001.

Federal State

15,000,000

Federal State

THOMAS J. RIDGE

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