42 U.S.C. § 292o — Definitions

Page 1002 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 292o priate institutional capability for the adminis- tration by an eligible institution of a program of student financial aid with respect to funds obtained from a student who has received a loan insured under this subpart; (3) the limitation, suspension, or termi- nation of the eligibility under this subpart of any otherwise eligible institution, whenever the Secretary has determined, after notice and affording an opportunity for hearing, that such institution has violated or failed to carry out any regulation prescribed under this sub- part; (4) the collection of information from the borrower, lender, or eligible institution to as- sure compliance with the provisions of section 292d of this title; (5) the assessing of tuition or fees to bor- rowers in amounts that are the same or less than the amount of tuition and fees assessed to nonborrowers; (6) the submission, by the institution or the lender to the Office of Health Education As- sistance Loan Default Reduction, of informa- tion concerning each loan made under this subpart, including the date when each such loan was originated, the date when each such loan is sold, the identity of the loan holder and information concerning a change in the borrower’s status; (7) the withholding of services, including academic transcripts, financial aid tran- scripts, and alumni services, by an institution from a borrower upon the default of such bor- rower of a loan under this subpart, except in case of a borrower who has filed for bank- ruptcy; and (8) the offering, by the lender to the bor- rower, of a variety of repayment options, in- cluding fixed-rate, graduated repayment with negative amortization permitted, and income dependent payments for a limited period fol- lowed by level monthly payments. (b) Recording by institution of information on students The Secretary shall require an eligible institu- tion to record, and make available to the lender and to the Secretary upon request, the name, address, postgraduate destination, and other reasonable identifying information for each stu- dent of such institution who has a loan insured under this subpart. (c) Workshop for student borrowers Each participating eligible institution must have, at the beginning of each academic year, a workshop concerning the provisions of this sub- part that all student borrowers shall be required to attend. (July 1, 1944, ch. 373, title VII, § 715, as added Pub. L. 102–408, title I, § 102, Oct. 13, 1992, 106 Stat. 2009.) § 292o. Definitions For purposes of this subpart: (1) The term ‘‘eligible institution’’ means, with respect to a fiscal year, a school of medi- cine, osteopathic medicine, dentistry, veteri- nary medicine, optometry, podiatric medicine, pharmacy, public health, allied health, or chiropractic, or a graduate program in health administration or behavioral and mental health practice, including clinical psychology. (2) The term ‘‘eligible lender’’ means an eli- gible institution that became a lender under this subpart prior to September 15, 1992, an agency or instrumentality of a State, a finan- cial or credit institution (including an insur- ance company) which is subject to examina- tion and supervision by an agency of the United States or of any State, a pension fund approved by the Secretary for this purpose, or a nonprofit private entity designated by the State, regulated by the State, and approved by the Secretary. (3) The term ‘‘line of credit’’ means an ar- rangement or agreement between the lender and the borrower whereby a loan is paid out by the lender to the borrower in annual install- ments, or whereby the lender agrees to make, in addition to the initial loan, additional loans in subsequent years. (4) The term ‘‘school of allied health’’ means a program in a school of allied health (as de- fined in section 295p of this title) which leads to a masters’ degree or a doctoral degree. (5)(A) The term ‘‘default rate’’, in the case of an eligible entity, means the percentage con- stituted by the ratio of— (i) the principal amount of loans insured under this subpart— (I) that are made with respect to the en- tity and that enter repayment status after April 7, 1987; and (II) for which amounts have been paid under section 292f(a) of this title to insur- ance beneficiaries, exclusive of any loan for which amounts have been so paid as a result of the death or total and permanent disability of the borrower; exclusive of any loan for which the borrower begins pay- ments to the Secretary on the loan pursu- ant to section 292f(b) of this title and maintains payments for 12 consecutive months in accordance with the agreement involved (with the loan subsequently being included or excluded, as the case may be, as amounts paid under section 292f(a) of this title according to whether further de- faults occur and whether with respect to the default involved compliance with such requirement regarding 12 consecutive months occurs); and exclusive of any loan on which payments may not be recovered by reason of the obligation under the loan being discharged in bankruptcy under title 11; to (ii) the total principal amount of loans in- sured under this subpart that are made with respect to the entity and that enter repay- ment status after April 7, 1987. (B) For purposes of subparagraph (A), a loan insured under this subpart shall be considered to have entered repayment status if the appli- cable period described in subparagraph (B) of section 292d(a)(2) of this title regarding the loan has expired (without regard to whether any period described in subparagraph (C) of such section is applicable regarding the loan). (C) For purposes of subparagraph (A), the term ‘‘eligible entity’’ means an eligible insti- Page 1003 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 292q tution, an eligible lender, or a holder, as the case may be. (D) For purposes of subparagraph (A), a loan is made with respect to an eligible entity if— (i) in the case of an eligible institution, the loan was made to students of the institu- tion; (ii) in the case of an eligible lender, the loan was made by the lender; and (iii) in the case of a holder, the loan was purchased by the holder. (6) The term ‘‘Secretary’’ means the Sec- retary of Education. (July 1, 1944, ch. 373, title VII, § 719, as added Pub. L. 102–408, title I, § 102, Oct. 13, 1992, 106 Stat. 2009; amended Pub. L. 105–392, title I, § 141(c)(2), Nov. 13, 1998, 112 Stat. 3579; Pub. L. 113–76, div. H, title V, § 525(e), Jan. 17, 2014, 128 Stat. 413.) Editorial Notes AMENDMENTS 2014—Par. (6). Pub. L. 113–76 added par. (6). 1998—Par. (1). Pub. L. 105–392 substituted ‘‘or behav- ioral and mental health practice, including clinical psychology’’ for ‘‘or clinical psychology’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2014 AMENDMENT Pub. L. 113–76, div. H, title V, § 525(e), Jan. 17, 2014, 128 Stat. 413, provided in part that the amendment made by section 525(e) is effective as of the date on which the transfer of the HEAL program under subsec. (a) of sec- tion 525 of Pub. L. 113–76, set out as a note under sec- tion 292 of this title, takes effect [no later than the end of the first fiscal quarter that begins after Jan. 17, 2014]. § 292p. Authorization of appropriations (a) In general For fiscal year 1993 and subsequent fiscal years, there are authorized to be appropriated such sums as may be necessary for the adequacy of the student loan insurance account under this subpart and for the purpose of administering this subpart. (b) Availability of sums Sums appropriated under subsection (a) shall remain available until expended. (July 1, 1944, ch. 373, title VII, § 720, as added Pub. L. 102–408, title I, § 102, Oct. 13, 1992, 106 Stat. 2011.) Editorial Notes PRIOR PROVISIONS A prior section 720 of act July 1, 1944, was classified to section 293 of this title prior to the general revision of this subchapter by Pub. L. 102–408. SUBPART II—FEDERALLY-SUPPORTED STUDENT LOAN FUNDS § 292q. Agreements for operation of school loan funds (a) Fund agreements The Secretary is authorized to enter into an agreement for the establishment and operation of a student loan fund in accordance with this subpart with any public or other nonprofit school of medicine, osteopathic medicine, den- tistry, pharmacy, podiatric medicine, optom- etry, or veterinary medicine. (b) Requirements Each agreement entered into under this sec- tion shall— (1) provide for establishment of a student loan fund by the school; (2) provide for deposit in the fund of— (A) the Federal capital contributions to the fund; (B) an amount equal to not less than one- ninth of such Federal capital contributions, contributed by such institution; (C) collections of principal and interest on loans made from the fund; (D) collections pursuant to section 292r(j) of this title; and (E) any other earnings of the fund; (3) provide that the fund shall be used only for loans to students of the school in accord- ance with the agreement and for costs of col- lection of such loans and interest thereon; (4) provide that loans may be made from such funds only to students pursuing a full- time course of study at the school leading to a degree of doctor of medicine, doctor of den- tistry or an equivalent degree, doctor of oste- opathy, bachelor of science in pharmacy or an equivalent degree, doctor of pharmacy or an equivalent degree, doctor of podiatric medi- cine or an equivalent degree, doctor of optom- etry or an equivalent degree, or doctor of vet- erinary medicine or an equivalent degree; (5) provide that the school shall advise, in writing, each applicant for a loan from the student loan fund of the provisions of section 292r of this title under which outstanding loans from the student loan fund may be paid (in whole or in part) by the Secretary; and (6) contain such other provisions as are nec- essary to protect the financial interests of the United States. (c) Failure of school to collect loans (1) In general Any standard established by the Secretary by regulation for the collection by schools of medicine, osteopathic medicine, dentistry, pharmacy, podiatric medicine, optometry, or veterinary medicine of loans made pursuant to loan agreements under this subpart shall pro- vide that the failure of any such school to col- lect such loans shall be measured in accord- ance with this subsection. This subsection may not be construed to require such schools to reimburse the student loan fund under this subpart for loans that became uncollectible prior to August 1985 or to penalize such schools with respect to such loans. (2) Extent of failure The measurement of a school’s failure to collect loans made under this subpart shall be the ratio (stated as a percentage) that the de- faulted principal amount outstanding of such school bears to the matured loans of such school.