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HEALTH
RESOURCES AND SERVICES ADMINISTRATION
(Health Education Assistance Loan Program)
FY
2009 Proposed Appropriation Language
Such sums as may be necessary
to carry out the purpose of the program, as
authorized by title VII of the Public Health
Service Act, as amended. For administrative
expenses to carry out the guaranteed loan program,
including section 709 of the Public Health Service
Act $2,906,000.
Amounts Available
for Obligation
| |
FY
2007 Actual |
FY
2008 Enacted |
FY
2009 Estimate |
| Balance,
start of year |
$143,313,000
|
$107,112,000
|
$80,331,000 |
|
Appropriation |
2,898,000
|
2,847,000
|
2,906,000
|
| Collections
|
| Upward
Re-estimate |
---
|
25,000,000
|
--- |
| Downward
Re-estimate |
-33,902,000
|
-44,000,000 |
--- |
| Interest
|
6,112,000 |
5,000,000 |
4,000,000 |
| Repayments/Recoveries |
7,060,000 |
3,508,000 |
4,552,000 |
| Total
collections |
-20,730,000 |
-10,492,000 |
8,552,000 |
|
Total available |
125,481,000
|
99,467,000 |
91,789,000 |
| Claims
|
| Death
and disability |
-2,652,000 |
-1,725,000
|
-1,698,000 |
| Defaults |
-12,819,000 |
-14,564,000
|
-14,335,000 |
| Total
claims |
-15,471,000 |
-16,289,000 |
-16,033,000 |
| Administrative
Expenses |
-2,898,000 |
-2,847,000 |
-2,906,000 |
| Ending
balance |
$107,112,000
|
$80,331,000
|
$72,850,000
|
Liquidating Account (SLIA)
Amounts Available for Obligation
| Balance,
start of year |
FY
2007
Actual |
FY
2008
Enacted |
FY
2009
Estimate |
| |
--- |
3,263,000
|
--- |
| Appropriation |
$1,000,000 |
$1,000,000
|
$1,000,000
|
| Collections: |
| Repayments/Recoveries |
13,989,000 |
10,000,000 |
10,000,000 |
| Recoveries of prior year
obligations |
3,263,000 |
--- |
--- |
| Capital transfer to general
fund |
--- |
-3,263,000 |
--- |
| Total available |
18,252,000
|
11,000,000
|
11,000,000
|
| Total claims |
-3,043,000 |
-3,000,000 |
-3,000,000 |
| Sweep-up to Treasury |
$11,946,000
|
$8,000,000
|
$8,000,000
|
SUMMARY OF CHANGES
Discretionary Appropriation:
| Increase: |
FTE |
Budget
Authority |
| 2008 HEAL Program Account |
12 |
$2,847,000 |
| 2009 HEAL Program Account. |
12 |
2,906,000 |
| Total Change |
-- |
+$ 59,000 |
Budget
Authority by Activity
(Dollars in thousands)
| |
FY
2007
Actual |
FY
2008
Enacted |
FY
2009
Estimate |
| Liquidating Account SLIA
|
$1,000,000
|
$1,000,000
|
$1,000,000
|
| HEAL Program Account:
|
| Administrative Expenses
|
$ 2,898,000
|
$2,847,000
|
$2,906,000
|
Budget
Authority by Object
Liquidating Account (SLIA)
| Object
Class (42.0) |
FY
2008
Enacted |
FY
2009
Estimate |
Increase
or
Decrease |
| Investments
and loans |
$1,000,000 |
$1,000,000 |
--- |
Budget
Authority by Object
Program Account
FY 2008
Enacted |
FY
2009
Estimate |
Increase
or
Decrease |
| Full-time
equivalent employment 1/ |
12 |
12 |
- |
| Average
GS Grade |
13.6 |
13.7 |
- |
| Average
GS Salary |
$96,791
|
$99,557
|
- |
| 1/
Includes 7 FTEs for the Office of HEAL Default
Reduction. |
FY
2008
Enacted |
FY
2009
Estimate |
Increase
or
Decrease |
| Personnel
compensation: |
| Full-time
permanent (11.1 |
$1,019,000
|
$1,065,000
|
$46,000
|
| Other
than full-time perm (11.3) |
102,000 |
107,000 |
5,000 |
| Other
personnel comp (11.5) |
24,000 |
24,000 |
- |
| Total
personnel comp (11.9) |
1,145,000 |
1,196,000 |
51,000 |
| Personnel
benefits (12.1) |
213,000 |
223,000 |
10,000 |
| Benefits
for Former Personnel(13.1) |
6,000 |
6,000 |
- |
| Subtotal
Pay Costs |
$1,364,000
|
$1,425,000
|
$61,000
|
| Transportation
of things (22.0) |
- |
- |
- |
| Rental
payments to GSA (23.1) |
130,000 |
133,000 |
$3,000
|
| Printing
(24.0) |
3,000 |
3,000 |
- |
| Other
Contractual Services: |
|
|
|
| Other
services (25.2) |
469,000 |
475,000 |
6,000 |
| Purchase
of goods and services from |
|
other Government accounts (25.3) |
868,000 |
858,000 |
-10,000 |
| Operation
and Maintenance of Equipment (25.7) |
11,000 |
10,000 |
-1,000 |
| Subtotal
Other Contractual Services |
$1,348,000
|
$1,343,000
|
-5,000 |
| Equipment
(31.0) |
2,000 |
2,000 |
- |
| Subtotal
Non-Pay Cost |
$1,483,000
|
$1,481,000
|
-2,000 |
| Total
Budget Authority by Object Class |
$2,847,000
|
$2,906,000
|
$59,000
|
Salaries and Expenses
Program Account
| |
FY
2008
Enacted
|
FY
2009
Estimate |
Increase
or
Decrease |
| Personnel
compensation: |
| Full-time permanent (11.1) |
$1,019,000
|
$1,065,000
|
$46,000
|
| Other than full-time perm (11.3) |
102,000 |
107,000 |
5,000 |
| Other personnel comp (11.5) |
24,000 |
24,000 |
- |
| Total personnel comp (11.9) |
$1,145,000
|
$1,196,000
|
$51,000
|
| Personnel benefits (12.1) |
213,000 |
223,000 |
10,000 |
| Military personnel benefits (13.1) |
6,000 |
6,000 |
- |
| Subtotal Pay Costs |
$1,364,000
|
$1,425,000
|
$61,000
|
| Transportation of things (22.0) |
- |
- |
- |
| Printing (24.0) |
3,000 |
3,000 |
- |
| Other Contractual
Services: |
| Other services (25.2) |
469,000 |
475,000 |
6,000 |
Purchase of goods and services from other
Government accounts (25.3) |
868,000 |
858,000 |
-10,000 |
| Operation and Maintenance of Equipment
(25.7) |
11,000 |
10,000 |
-1,000 |
| Subtotal Other Contractual Services. |
$1,348,000
|
$1,343,000
|
($5,000) |
| Subtotal Non-Pay Cost |
$1,351,000
|
$1,346,000
|
($5,000) |
| Total Salaries and Expenses |
$2,715,000
|
$2,771,000
|
$56,000
|
Authorizing
Legislation
| |
FY
2008 Amount Authorized |
FY
2008
Enacted |
FY
2009
Amount
Authorized |
FY
2009
Budget
Request |
| Health
Education Assistance Loans and Student Loan
Insurance Account: |
Appropriation:
Liquidating Account (SLIA):
PHS Act, Sec 710
|
1/ |
1,000,000
|
1/
|
1,000,000
|
Program
Account:
PHS Act, Secs. 709, 720* |
SSAN* |
2,847,000
|
SSAN* |
2,906,000
|
| Borrowing
authority (SLIA): PHS Act, Sec 710(b). |
2/ |
--- |
2/ |
--- |
| *Such
sums as may be necessary. |
1/
Sec 710(a)(2) states "Except as provided
in subparagraph (B), all amounts received by
the Secretary as premium charges for insurance
and as receipts, earnings, or proceeds derived
from any claim or other assets acquired by the
Secretary in connection with his operations
under this subpart, and any other moneys, property,
or assets derived by the Secretary from the
operations of the Secretary in connection with
this section, shall be deposited in the Account."
2/ Sec 710(b) states "If at any time, the
moneys in the Account are insufficient to make
payments in connection with the collection or
default of any loan insured by the Secretary
under this subpart, the Secretary of the Treasury
may lend the Account such amounts as may be
necessary to make the payments involved, subject
to the Federal Credit Reform Act of 1990."
APPROPRIATION
HISTORY
SLIA Liquidating Account
|
Budget
Estimate
to Congress |
Allowance
House |
Senate
Allowance |
Appropriation |
| 1999 |
37,000,000 |
37,000,000 |
37,000,000 |
37,000,000 |
| 2000 |
31,500,000 |
31,500,000 |
31,500,000 |
31,500,000 |
| 2001 |
10,000,000 |
10,000,000 |
10,000,000 |
10,000,000 |
| 2002 |
10,000,000 |
10,000,000 |
10,000,000 |
10,000,000 |
| 2003 |
7,000,000 |
7,000,000 |
7,000,000 |
7,000,000 |
| 2004 |
4,000,000 |
4,000,000 |
4,000,000 |
4,000,000 |
| 2005 |
4,000,000 |
4,000,000 |
4,000,000 |
4,000,000 |
| 2006 |
4,000,000 |
4,000,000 |
4,000,000 |
4,000,000 |
| 2007 |
4,000,000 |
1,000,000 |
1,000,000 |
1,000,000 |
| 2008 |
1,000,000 |
1,000,000 |
1,000,000 |
1,000,000 |
| 2009 |
1,000,000 |
|
|
|
APPROPRIATION HISTORY
HEAL Program Account
| |
Budget
Estimate
to Congress |
House
Allowance |
Senate
Allowance |
Appropriation
|
| 1999 |
3,688,000 |
3,688,000
|
3,688,000
|
3,688,000 |
| 2000 |
3,688,000
|
3,688,000
|
3,688,000
|
3,688,000 |
| Rescission |
--- |
--- |
--- |
-1000 |
| 2001
|
3,679,000 |
3,679,000
|
3,679,000 |
3,679,000 |
| Rescission |
--- |
--- |
--- |
-7,000 |
| 2002 |
3,792,000 |
3,792,000
|
3,792,000
|
3,792,000 |
| Rescission |
--- |
--- |
--- |
-1,000 |
| 2003
|
3,914,000
|
3,914,000 |
3,914,000 |
3,914,000 |
| Rescission |
--- |
--- |
--- |
-25,000 |
| 2004 |
3,389,000 |
3,389,000 |
3,389,000 |
3,389,000 |
| Rescission |
--- |
--- |
--- |
-36,000 |
| 2005 |
3,270,000 |
3,270,000 |
3,270,000 |
3,270,000 |
| Rescission |
--- |
--- |
--- |
-26,000
|
| 2006
|
2,916,000 |
2,916,000 |
2,916,000 |
2,916,000 |
| Rescission |
--- |
--- |
--- |
-31,000 |
| 2007 |
2,887,000 |
2,887,000 |
2,887,000 |
2,898,000 |
| 2008 |
2,906,000
|
2,906,000
|
2,906,000
|
2,847,000 |
| 2009 |
2,906,000
|
|
|
|
General Statement
Health Education Assistance Loans (HEAL)
To assist in training students in various health
fields, the HEAL program was authorized to provide
insured loans for students enrolled in schools
of allopathic and osteopathic medicine, dentistry,
veterinary medicine, optometry, podiatry, public
health, pharmacy, chiropractic, and graduate
programs in health administration, clinical
psychology and allied health.
Eligible student borrowers obtain loans, to
be used for tuition and other reasonable educational
and living expenses, from participating commercial
lenders, educational institutions, State agencies,
insurance companies and pension funds. The repayment
of principal and interest is guaranteed by the
Federal Government if the borrower becomes permanently
disabled, dies, or defaults on the repayments.
Student Loan Insurance Account (SLIA)
The SLIA provides repayments to the lenders
on defaulted HEAL loans, and for claims due
to the death or disability of student borrowers.
Deposits to the fund are derived from insurance
premiums charged to the borrowers when the loans
are made, repayments of defaulted claims, and
if necessary, from borrowing authority and/or
appropriations.
Health Education Assistance
Loans
| |
FY 2007
Actual |
FY
2008
Enacted |
FY
2009
Estimate |
FY
2009 +/-
FY 2008 |
| Liquidating
Account |
$1,000,000
|
$1,000,000
|
$1,000,000
|
|
| Administrative
Expenses |
2,898,000 |
2,847,000 |
2,906,000 |
$59,000
|
| Total |
$3,898,000
|
$3,847,000
|
$3,906,000
|
$59,000
|
| FTE |
12 |
12 |
12 |
|
Authorizing
legislation: Sections 701-720 of the Public
Health Service Act
| FY
2009 Authorization |
Expired
except for Administrative Expenses and Office
of Health Education Assistance Loans (HEAL)
Default Reduction. |
| FY
2009 Authorization - Liquidating Account |
Such
Sums As Necessary |
| Allocation
Method |
Other
|
Program Description and Accomplishments
The Health Education Assistance Loan (HEAL)
Program was established in 1977 via Sections
701-720 of the Public Health Service Act. Between
1978 and 1998 the HEAL Program insured loans
made by participating lenders to eligible graduate
students in schools of allopathic medicine,
osteopathic medicine, dentistry, veterinary
medicine, optometry, podiatry, public health,
pharmacy, health administration, clinical psychology
and chiropractic medicine. The program has provided
$4,000,000,000 to help 156,000 students of diverse
socio-economic backgrounds pay for their health
professions education. Although authority to
make new HEAL loans expired September 30, 1998,
and refinancing ended September 30, 2004, the
program has an outstanding loan portfolio of
approximately $1.1 billion as of September 30,
2007 which may not be fully repaid until 2037.
As the original and refinanced HEAL loan term
can extend at least 25 to 33 years, administrative
funds are required to properly service active
accounts, project future claims, and to carry
out default reduction activities which can save
taxpayers millions of dollars. Timely payment
of claims will avoid excess interest payments
to lenders and aid in recovery of overdue accounts.
The HEAL Program maintains, and updates quarterly,
a list of defaulted HEAL borrowers on the internet
(www.defaulteddocs.dhhs.gov). These borrowers
who have defaulted on the repayment of their
HEAL loans are excluded, as practitioners, from
participating in Medicare/Medicaid. The program
makes available additional information with
respect to these borrowers to relevant Federal
and State agencies and legislators, school associations,
professional and specialty associations, State
licensing boards, hospitals with which such
borrowers may be associated, and other relevant
organizations. Millions of dollars have been
received from defaulters as a result of the
activities associated with publicizing their
names.
The HEAL Program continues to maintain oversight
for an outstanding portfolio that includes approximately
35,120 borrowers with loans worth approximately
$1.1 billion as of September 30, 2007. In FY
2007, the default rate for the HEAL Program
decreased from 2.8 to 2.7 percent.
The HEAL staff have continued to maintain essential
operational activities associated with a loan
guarantee program of this magnitude, such as
the processing of lender claims and borrower
requests for forbearance and disability. Default
reduction activities have also continued, including
providing technical assistance to States regarding
licensing sanctions, and maintaining and updating
the HEAL defaulter web site, which currently
includes approximately 1,115 health professionals
who owe the Federal Government approximately
$145,599,503 on their defaulted HEAL loans as
of November 2007.
The program has historically met or exceeded
its targets for phasing out the outstanding
loan portfolio, through initiatives to help
borrowers manage their indebtedness, and through
partnerships with lenders and loan holders.
In FY 2007, the projection of $1.090 billion
was not able to be met due to the historical
trend of HEAL loans that refinanced out of the
program and borrowers that paid-in-full turned
out to be lower than anticipated. The HEAL Program
does not have any control over the early payoff
activity that happens in the loan servicing
industry.
Funding History
| |
Direct
Operations |
Liquidating
Account |
FY 2004
FY 2005
FY 2006
FY 2007
FY 2008 |
$3,353,000
$3,244,000
$2,885,000
$2,898,000
$2,847,000 |
$4,000,000
$4,000,000
$4,000,000
$1,000,000
$1,000,000 |
Budget Request
The
FY 2009 Request of $3,906,000 is $59,000 over
the FY 2008 Enacted level. This request includes
an estimate of $1,000,000 for the Liquidating
Account to handle claims (defaults, death and
disabilities) that will come due in FY 2009
for loans guaranteed prior to FY 1992.
Also included in this request is $1,906,000
for HEAL Program operations and $1,000,000 for
default reduction activities, previously funded
from the student loan insurance account. These
funds are required for program administration,
default reduction, and post-default collections.
| #
|
Key
Outcomes |
FY
04 Actual |
FY
05 Actual |
FY
2006 |
FY
2007 |
FY
08 Target |
FY
09 Target |
Out
Year Target |
| Target
|
Actual
|
Target
|
Actual
|
| Long
Term Objective: Achieve Excellence in Management
|
| 9.VII.C.1
|
Conduct
an orderly phaseout of the outstanding loan
portfolio, resulting in a reduction in the
Federal liability associated with the HEAL
program* |
$2,028
|
$1,709
|
$1,700
|
$1,375
|
$1,090
|
$1,131
|
$997
|
$866
|
|
| # |
Key
Outputs |
FY
2004 Actual |
FY
2005 Actual |
FY
2006 |
FY
2007 |
FY
2008 Enacted |
FY
2009 Est. |
Out-Year
Target |
| Target |
Actual |
Target |
Actual |
| Efficiency
Measure |
| 9.E |
Improve claims processing
efficiency through implementation of an
online processing system (HOPS). (Baseline
2004 – 10 Days) |
10
Days |
9
Days |
9
Days |
8
Days |
8
Days |
8
Days |
8
Days |
8
Days |
NA |
| |
Liquidating Account Approp.:
($000) |
$4,000
|
$4,000
|
NA |
$4,000
|
NA |
$1,000
|
$1,000
|
$1,000
|
NA |
| |
Collections from the Public
$0 |
$21,349
|
$17,064
|
NA |
$15,257
|
NA |
$13,989
|
$10,000
|
$10,000
|
NA |
| |
Obligations for Claims
$0 |
$15,000
|
$4,000 |
NA |
$2,623
|
NA |
$3,000 |
$3,043 |
$3,000 |
NA |
| |
Appropriated Amount ($
Million) |
$7.353 |
$7.244 |
|
$6.885 |
|
$3.898 |
$3.847 |
$3.906 |
|
Notes
* Dollars in millions
NA
- Not Applicable
|
