S2378

An Act concerning loan redemption for certain health care professionals who provide services during the COVID-19 pandemic and supplementing chapter 71C of Title 18A of the New Jersey Statutes.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. As used in this act:

“Approved site” means a licensed hospital or dedicated part thereof wherein patients in New Jersey with COVID-19 are treated or housed in isolation and where there is an insufficient number or type of professional staff to ensure the provision of adequate care to those patients; and any other health care facility, building, room, tent, ship, or other location that is temporarily authorized and used, on an emergency or overflow basis, to provide isolated bed space or intensive, emergency, or other hospital-level care to patients with COVID-19 in New Jersey.

“Authority” means the Higher Education Student Assistance Authority or its designated agent.

“Commissioner” means the Commissioner of Health.

“COVID-19” means the disease caused by the novel and highly contagious coronavirus strain identified as SARS-CoV-2, which was first detected in China in late 2019, first detected in the United States in January 2020, and to which humans have no natural immunity, and which has quickly spread across the globe and resulted in a worldwide pandemic, as declared by the World Health Organization in March 2020.

“Eligible qualifying loan expenses” means the cumulative outstanding balance of student loans covering the cost of a program applicant’s attendance at undergraduate and graduate institutions of education at the time the applicant is selected to participate in the program, as well as any interest paid or due on qualifying loans that a program applicant has taken out for use in paying the costs of undergraduate and graduate education, except that, for physicians, “eligible qualifying loan expenses” shall include only the cumulative outstanding balance of, and any interest paid or due on, those qualifying loans that cover the costs of education occurring between the time of the physician’s entry into medical school and the awarding of the physician’s degree in allopathic or osteopathic medicine.

“Executive director” means the executive director of the Higher Education Student Assistance Authority, or the executive director’s designee.

“Health care professional” means a licensed physician, nurse, physician’s assistant, or other health care practitioner, or any person working in the area of hospital or health care facility administration, who is capable of providing needed health care services or health care-related administrative services, on a paid or unpaid, temporary, short-term, or long-term basis, at an approved site during the COVID-19 pandemic. “Health care professional” includes a licensed physician, nurse, physician’s assistant, or other health care practitioner who would ordinarily be capable of providing health care services to COVID-19 patients at an approved site during the COVID-19 pandemic, but who is currently unavailable to provide those services because the health care professional is self-isolating or is subject to mandatory quarantine as a result of having contracted COVID-19, showing symptoms of COVID-19, or having been exposed to COVID-19 in the workplace.

“Medicare” means the federal Medicare program established pursuant to Pub.L.89-97 (42 U.S.C. s.1395 et seq.).

“Program” means the COVID-19 Exemplary Service Loan Redemption Program established pursuant to this act.

“Program participant” means a health care professional who contracts with the authority and agrees to provide health care services, such as intensive care or emergency care services, or health care-related administrative services, at an approved site and in accordance with a contract executed pursuant to section 3 of this act, in exchange for the redemption of eligible qualifying loan expenses under the program.

“Qualifying loan” means a government or commercial loan that covers the actual costs paid for tuition and for reasonable educational and living expenses associated with obtaining a degree in the area of allopathic or osteopathic medicine, nursing, hospital or health care facility administration, or any other similar health care profession.

2. a. There is established, within the Higher Education Student Assistance Authority, a COVID-19 Exemplary Service Loan Redemption Program to provide for the redemption of eligible qualifying loan expenses of health care professionals in exchange for the professionals’ ongoing provision of health care and administrative services at approved sites during the COVID-19 pandemic.

b. Any health care professional who is a resident of New Jersey shall be eligible to participate in the COVID-19 Exemplary Service Loan Redemption Program. Any eligible health care professional wishing to participate in the program shall enter into a loan redemption contract with the authority, pursuant to section 3 of this act.

c. (1) A program participant shall be eligible for redemption of up to 50 percent of the program participant’s eligible qualifying loan expenses, except that the total amount of qualifying loans redeemed by a program participant may not exceed the maximum amount authorized by the federal government, pursuant to section 338I of the “Public Health Service Act,” 42 U.S.C. s.254q-1, either in State funds alone or in the sum of all federal, State, and other non-federal matching funds. The authority, in consultation with the Department of Health, may establish other general limits, as deemed thereby to be appropriate, on the total amount of qualifying loans that may be redeemed by program participants.

(2) A person who is already participating in: (a) the federally administered National Health Service Corps Loan Repayment Program, established pursuant to section 338B of the “Public Health Service Act,” 42 U.S.C.s.254 l-1; (b) the Primary Care Practitioner Loan Redemption Program, established pursuant to N.J.S.18A:71C-32 et seq.; or (c) any other similar health care-related loan redemption program shall be eligible to participate simultaneously in the COVID-19 Exemplary Service Loan Redemption Program, provided that such simultaneous participation is expressly disclosed and is authorized by the authority in the loan redemption contract executed under section 3 of this act. A program participant shall only be eligible to redeem eligible qualifying loan expenses under the COVID-19 Exemplary Service Loan Redemption Program to the extent that those expenses are not already eligible for redemption under one of the other programs identified in this paragraph.

(3) No amount of qualifying loan expenses shall be redeemed by a program participant if contracted services are provided by a program participant for a period of time that is less than that the term of service required by paragraph (2) of subsection a. of section 3 of this act. However, a health care professional shall not be penalized or prevented from applying for or obtaining loan redemption under this act, and shall not be subject to any reduction in the amount of qualifying loan expenses redeemed under the contract, solely on the basis that the health care professional is or was unable to provide necessary services, for any portion of the requisite term of service, for any of the reasons specified in paragraph (4) of subsection d. of this section.

d. In determining, for loan redemption purposes, whether a program participant has complied with the term of service requirements established by paragraph (2) of subsection a. of section 3 of this act, the program participant shall receive full service credit for the following time periods:

(1) the initial four-week probationary period served under subsection a. of section 6 of this act;

(2) any period of time, which elapsed prior to the execution of the loan redemption contract and after the first COVID-19 case was discovered in New Jersey, during which the health care professional was providing services, as described by paragraph (1) of subsection a. of section 3 of this act, at an approved site;

(3) any period of time during which the program participant was not providing services under the contract while waiting for the executive director to authorize the program participant’s alternate placement at another approved site pursuant to paragraph (2) of subsection a. or subsection b. of section 6 of this act; and

(4) any period of time during which the program participant was isolated or under mandatory quarantine and unable to provide necessary services because the program participant had contracted COVID-19, was showing symptoms of COVID-19, or had been directly exposed to COVID-19 at the workplace; provided that the program participant returned to service immediately upon the receipt of medical or supervisory clearance therefor, as appropriate.

3. a. The authority shall enter into a loan redemption contract with each eligible health care professional who applies to participate in the program, to the extent practicable and consistent with the provisions of subsection a. of section 4 of this act. The contract shall require the program participant to:

(1) provide needed health care services or health care-related administrative services at an approved site selected pursuant to subsection b. of this section, as may be deemed by the approved site to be necessary to fill its COVID-19 staffing needs and adequately serve and treat its patients with COVID-19, regardless of whether such services are within the program participant’s ordinary scope of practice;

(2) engage in the provision of necessary services, as required by paragraph (1) of this subsection, for a consecutive period of at least 12 months or until a COVID-19 vaccine is made available to residents of New Jersey, whichever is later;

(3) charge for professional services at the usual and customary rate prevailing in the area in which the approved site is located and in a manner that is consistent with the charging practices of the approved site and all State and federal laws; charge a Medicare beneficiary no more than the limiting fee for a service, as determined by the United States Secretary of Health and Human Services; and allow a patient with COVID-19 who is unable to pay for services at the usual and customary rate to pay at a reduced rate or to receive services at no charge; and

(4) not discriminate against any patient in the provision of COVID-19-related health care services on the basis of: (a) the patient’s ability to pay or source of payment; or (b) the patient’s actual or perceived age, sex, gender identity or expression, affectional or sexual orientation, race, creed, color, ethnicity, national origin, ancestry, religion, marital status, familial status, or mental or physical disability.

b. The contract executed pursuant to this section shall specify the program participant’s dates of required service, the total amount of eligible qualifying loan expenses that are to be redeemed by the State in return for service, and the schedule for loan redemption, which shall be established by the authority and uniformly applied to all program participants. The contract shall also stipulate that the applicant has knowledge of and agrees to:

(1) comply with the performance standards established pursuant to section 5 of this act; and

(2) participate in the four-week probationary period required by section 6 of this act.

4. a. (1) The executive director shall enter into contracts with eligible applicants, as provided by section 3 of this act, subject to available funds and the needs of approved sites in the State. In the event that there are insufficient funds or insufficient need to select all of the applicants who meet the eligibility criteria, the executive director shall accord priority to applicants in the following manner: (a) first, to any applicant who is already providing COVID-19-related health care or administrative services at an approved site; (b) second, to any other applicant according to the severity of the COVID-19 outbreak and the shortage of health care professionals in the applicant’s county or region of residence; and (c) third, to any applicant who resides in a State designated underserved area. If there are more applicants than there are program positions, the executive director shall select program participants by means of a lottery or other form of random selection.

(2) Regardless of the means of program participant selection, the executive director, in consultation with the Commissioner of Health, shall ensure that the number of program participants is, to the greatest extent possible, sufficient to meet the demand for COVID-19-related health care and administrative services at approved sites in the State.

(3) The authority shall ensure that health care professionals wishing to participate in the program are able to apply online or through other remote means.

b. The executive director, in consultation with the commissioner, shall match contracted program participants with appropriate approved sites throughout the State. Primary consideration shall be given to the placement of program participants at approved sites in the State that have the highest numbers of patients with COVID-19 and insufficient staff available to effectively and efficiently handle those patients. To the extent practicable and consistent with meeting Statewide needs, the executive director, in consultation with the commissioner, shall match each program participant with an approved site that is located within close proximity to the program participant’s residence. Other factors to be considered in matching program participants with approved sites may include:

(1) the preferences of the program participant;

(2) statistical data projecting future regional and individual site needs in association with the COVID-19 pandemic; or

(3) any other factor deemed by the executive director or the commissioner to be relevant.

5. a. A program participant, as a condition of ongoing participation in the program, shall be required to adhere to performance standards established by the executive director.

b. The standards shall include, but need not be limited to, requirements that a participant:

(1) maintain residency in the State;

(2) maintain a license or certification as required for the program participant’s declared profession;

(3) remain current with payments on student loans;

(4) enter into a mutually acceptable service agreement with the approved site at which the program participant will be providing services under the loan redemption contract;

(5) engage in the satisfactory performance of tasks and provision of services at the approved site; and

(6) submit to the authority, prior to repayment of any amount eligible for redemption, and in a form and manner prescribed by the authority, a report on the services that were rendered by the program participant at each approved site pursuant to the loan redemption contract.

6. a. (1) Upon acceptance into the program and the execution of a contract pursuant to section 3 of this act, a program participant shall serve an initial four-week probationary period at an approved site. During that period, and to the extent practicable in light of the extreme circumstances surrounding the COVID-19 pandemic, the program participant’s designated supervisor, together with the program participant and the executive director, shall evaluate the suitability of the placement and the need for the program participant’s continued services, in either a health care or administrative capacity, at the approved site.

(2) At the end of the initial four-week probationary period, the program participant’s supervisor shall recommend the continuation of the program participant’s present placement, a change in placement, or a determination that the program participant is an unsuitable candidate for participation in the loan redemption program. If the supervisor recommends a change in placement, the executive director shall authorize the program participant’s placement at another approved site, and the program participant shall commence providing services at that alternate approved site as soon as is practicable. If the supervisor recommends a determination that the program participant is not a suitable candidate for the program, the executive director shall take this recommendation into consideration and make a final determination regarding the program participant’s suitability for continued participation in the program. If the executive director determines that the program participant is unsuitable for continued service, the contract shall be voided without penalty and the authority’s obligations thereunder shall be automatically nullified.

(3) No loan redemption payments shall be made under the contract during the four-week probationary period required by this subsection.

b. If, at any time following the conclusion of the initial four-week probationary period, the program participant’s current supervisor determines that there is no longer a need for the program participant to provide services at the approved site in relation to the COVID-19 pandemic, the supervisor shall notify the program participant and the executive director, and the executive director shall authorize the program participant’s placement at another approved site. The program participant shall commence providing services at that alternate approved site as soon as is practicable.

7. a. A program participant who has entered into a contract with the authority under this act may nullify the contract and the obligations imposed thereunder by notifying the authority in writing and reassuming full responsibility for the remaining outstanding balance of the loan debt. A program participant who nullifies the loan redemption contract under this section before completing the full term of service, as required by paragraph (2) of subsection c. of section 3 of this act, shall not be entitled to receive any loan redemption benefits under the program, and shall be required to repay any previously redeemed portion of indebtedness, with 50 percent of the redeemed portion of indebtedness being repaid within one year after the contract is nullified.

b. If a program participant dies or becomes totally and permanently disabled, the authority shall nullify the service obligation of the program participant. The nullification shall also terminate the authority's obligations under the loan redemption contract, except that, if the program participant's death or total and permanent disability occurred as a result of COVID-19 infection contracted while working at an approved site under the program, the program participant or the program participant’s estate, as appropriate, shall be entitled to receive loan redemption in association with the term actually served by the program participant and shall not be required to repay any portion of indebtedness that was redeemed during the period that preceded the program participant’s death or disability.

c. Whenever the continued enforcement of the contract may result in extreme hardship, the authority may nullify or suspend the service obligations of the program participant.

8. a. The executive director shall be authorized to terminate a program participant's service in the program in the case of:

(1) the program participant's conviction for a crime or an act of gross negligence in the performance of contractually mandated service obligations;

(2) the program participant’s conviction for a crime under section 7 of this act;

(3) the suspension or revocation of the program participant's professional license or certification;

(4) the program participant's breach of performance standards established pursuant to section 5 of this act; or

(5) the program participant’s failure to comply with the four-week probationary period required by subsection a. of section 6 of this act, or the executive director’s determination, at the conclusion of that four-week probationary period, that the program participant is unsuitable for continued participation in the program.

b. (1) A program participant who fails to repay any amount due the authority under the program may be subject to actions initiated by the authority to recover the amount due, to the extent permitted by State and federal law, including, but not be limited to, recovery through: an action filed in a court of competent jurisdiction; the offset of State tax refunds or rebates; the making of information about delinquent payments available to credit reporting agencies; or the exclusion of the program participant from eligibility for any other student assistance benefits administered by the authority or by the federal government, to the extent that loan redemption benefits are federally funded.

(2) In any judicial action, filed pursuant to this section, in which the authority is the prevailing party, the program participant shall be liable for: (a) the actual debt incurred; (b) all interest earned on the debt at the maximum legal prevailing rate as determined by the United States Treasurer; and (c) the administrative and court costs associated with collection of the debt.

9. The executive director may, as determined thereby to be appropriate, and within the limits of available funds, make payments in a reasonable amount to reimburse a program participant for all or part of any increased tax liability that is incurred by the participant, pursuant to the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq., as a result of the redemption of eligible qualifying loan expenses under the COVID-19 Exemplary Service Loan Redemption Program.

10. A person who knowingly or willfully furnishes any false or misleading information for the purpose of receiving loan redemption benefits under the COVID-19 Exemplary Service Loan Redemption Program, program is guilty of a crime of the fourth degree.

11. This act shall take effect immediately, and the Higher Education Student Assistance Authority shall promptly commence accepting applications and executing loan redemption contracts pursuant to this act, as soon after the effective date as may be reasonably practicable, in order to help ensure that New Jersey is able to mobilize and employ a sufficient number and type of available health care professionals to successfully combat and mitigate the effects of the COVID-19 pandemic in the State.

STATEMENT

This bill would establish, within the Higher Education Student Assistance Authority (authority), a COVID-19 Exemplary Service Loan Redemption Program to provide for the redemption of eligible qualifying loan expenses of health care professionals in exchange for the professionals’ ongoing provision of health care and administrative services at approved sites during the COVID-19 pandemic.

“Approved site” is defined by the bill to mean a licensed hospital or dedicated part thereof wherein patients in New Jersey with COVID-19 are treated or housed in isolation and where there is an insufficient number or type of professional staff to ensure the provision of adequate care to those patients; and any other health care facility, building, room, tent, ship, or other location that is temporarily authorized and used, on an emergency or overflow basis, to provide isolated bed space or intensive, emergency, or other hospital-level care to patients with COVID-19 in New Jersey. “Health care professional” is defined to mean a licensed physician, nurse, physician’s assistant, or other health care practitioner, or any person working in the area of hospital or health care facility administration, who is capable of providing needed health care services or health care-related administrative services, on a paid or unpaid, temporary, short-term, or long-term basis, at an approved site during the COVID-19 pandemic. “Health care professional” includes a licensed physician, nurse, physician’s assistant, or other health care practitioner who would ordinarily be capable of providing health care services to COVID-19 patients at an approved site during the COVID-19 pandemic, but who is currently unavailable to provide those services because the health care professional is self-isolating or is subject to mandatory quarantine as a result of having contracted COVID-19, showing symptoms of COVID-19, or having been exposed to COVID-19 in the workplace.

Any health care professional who is a resident of New Jersey would be eligible to participate in the COVID-19 Exemplary Service Loan Redemption Program. The bill would require the authority to enter into a loan redemption contract with each eligible health care professional who applies to participate in the program, to the extent practicable. Each contract is to require the program participant to:

1) provide needed health care services or health care-related administrative services at an approved site, as may be deemed by the approved site to be necessary to fill its COVID-19 staffing needs and adequately serve and treat its patients with COVID-19, regardless of whether such services are within the program participant’s ordinary scope of practice;

2) engage in the provision of necessary services, as required by the bill, for a consecutive period of at least 12 months or until a COVID-19 vaccine is made available to residents of New Jersey, whichever is later;

3) charge for professional services at the usual and customary rate prevailing in the area in which the approved site is located and in a manner that is consistent with the charging practices of the approved site and all State and federal laws; charge a Medicare beneficiary no more than the limiting fee for a service, as determined by the United States Secretary of Health and Human Services; and allow a patient with COVID-19 who is unable to pay for services at the usual and customary rate to pay at a reduced rate or to receive services at no charge; and

4) not discriminate against any patient in the provision of COVID-19-related health care services on the basis of: a) the patient’s ability to pay or source of payment; or b) the patient’s actual or perceived age, sex, gender identity or expression, affectional or sexual orientation, race, creed, color, ethnicity, national origin, ancestry, religion, marital status, familial status, or mental or physical disability.

The contract is to additionally: 1) specify the program participant’s dates of required service, the total amount of eligible qualifying loan expenses that are to be redeemed by the State in return for service, and the schedule for loan redemption, which is to be established by the authority and uniformly applied to all program participants; and 2) stipulate that the applicant has knowledge of and agrees to both comply with performance standards established by the authority’s executive director and participate in a four-week probationary period required by the bill.

A participant in the program would be eligible for redemption of up to 50 percent of the program participant’s eligible qualifying loan expenses; however, the total amount of qualifying loans redeemed by a program participant may not exceed the maximum amount authorized by the federal government, pursuant to section 338I of the “Public Health Service Act,” 42 U.S.C. s.254q-1. The authority, in consultation with the Department of Health, may establish other general limits, as deemed thereby to be appropriate, on the total amount of qualifying loans that may be redeemed by program participants.

A person who is already participating in: 1) the federally administered National Health Service Corps Loan Repayment Program, established pursuant to section 338B of the “Public Health Service Act,” 42 U.S.C.s.254 l-1; 2) the Primary Care Practitioner Loan Redemption Program, established pursuant to N.J.S.18A:71C-32 et seq.; or 3) any other similar health care-related loan redemption program will be eligible to participate simultaneously in the COVID-19 Exemplary Service Loan Redemption Program, provided that such simultaneous participation is expressly disclosed and is authorized by the authority in the loan redemption contract. A program participant will only be eligible to redeem eligible qualifying loan expenses under the COVID-19 Exemplary Service Loan Redemption Program to the extent that those expenses are not already eligible for redemption under one of these other programs.

Under the bill’s provisions, no amount of qualifying loan expenses may be redeemed by a program participant if contracted services are provided for a period of time that is less than that the term of service required by the bill and contract. However, a health care professional may not be penalized or prevented from applying for or obtaining loan redemption under the bill, and may not be subject to any reduction in the amount of qualifying loan expenses redeemed under the program, solely on the basis that the health care professional is or was unable to provide necessary services, for any portion of the requisite term of service, because the professional was isolated or under mandatory quarantine as a result of having contracted COVID-19, showing symptoms of COVID-19, or being exposed to COVID-19 in the workplace.

The authority’s executive director, in consultation with the Commissioner of Health, will be required to match contracted program participants with appropriate approved sites throughout the State. Primary consideration is to be given to the placement of program participants at approved sites in the State that have the highest numbers of patients with COVID-19 and insufficient staff available to effectively and efficiently handle those patients. To the extent practicable and consistent with meeting Statewide needs, each program participant is to be matched with an approved site that is located within close proximity to the program participant’s residence. Other factors to be considered in matching program participants with approved sites may include: 1) the preferences of the program participant; 2) statistical data projecting future regional and individual site needs in association with the COVID-19 pandemic; or 3) any other factor deemed by the executive director or the commissioner to be relevant.

Any program participant who nullifies the loan redemption contract before completing the full term of service, as required by the bill and contract, will not be entitled to receive any loan redemption benefits under the program, and will be required to repay any previously redeemed portion of indebtedness, with 50 percent of the redeemed portion of indebtedness being repaid within one year after the contract is nullified. If a program participant dies or becomes totally and permanently disabled, the authority will nullify the service obligation of the program participant, and the authority’s obligations will terminate, except that, if the program participant's death or total and permanent disability occurred as a result of COVID-19 infection contracted while working at an approved site under the program, the program participant or the program participant’s estate, as appropriate, will be entitled to receive loan redemption in association with the term actually served by the program participant and will not be required to repay any portion of indebtedness that was redeemed during the period that preceded the program participant’s death or disability. The authority may also nullify the program participant’s contractual obligations in cases of extreme hardship.

The bill authorizes the authority’s executive director, as determined thereby to be appropriate, and within the limits of available funds, to make payments in a reasonable amount to reimburse a program participant for all or part of any increased tax liability that is incurred by the participant, pursuant to the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq., as a result of the redemption of eligible qualifying loan expenses under the COVID-19 Exemplary Service Loan Redemption Program.

Any person who knowingly or willfully furnishes any false or misleading information for the purpose of receiving loan redemption benefits under the COVID-19 Exemplary Service Loan Redemption Program will be guilty of a crime of the fourth degree.