Health Center Program Statutory Changes: Bipartisan Budget Act of 2018 (BBA) Frequently Asked Questions

General

  1. What is the Bipartisan Budget Act of 2018 (BBA) and how did it impact Health Center Program requirements and oversight?

    The BBA was signed into law in February of 2018 and reauthorized spending for the Health Center Program and other federal programs for fiscal years (FY) 2018 and 2019. The BBA also amended certain sections of the Health Center Program statute (Section 330 of the Public Health Service (PHS) Act) by adding new requirements, changing some terminology, and increasing overall emphasis on the importance of maintaining compliance with Health Center Program requirements.

    In order to align with these statutory changes, the Heath Center Program Compliance Manual (Compliance Manual) has been updated and HRSA has also updated and aligned related Health Center Program documents, including the Health Center Program Site Visit Protocol (SVP), FY 2019 Service Area Competition (SAC) and Renewal of Designation (RD) application instructions, and certain conditions.

    Please refer to the list of Compliance Manual revisions (PDF - 583 KB) and the Health Center Program statute for current statutory language and detail on all statutory amendments.

  2. Did the amendments from the BBA impact specific Health Center Program requirements in the Compliance Manual?

    Yes. See the list of Compliance Manual revisions (PDF - 583 KB).

    • Section 330(k)(3)(H)(ii) of the PHS Act was amended and now requires the health center to directly employ the Project Director/Chief Executive Officer (PD/CEO). This new requirement has been added to the Requirements and Demonstrating Compliance element (d) in Chapter 11: Key Management Staff of the Health Center Program Compliance Manual. In addition, any related references to a contracted PD/CEO have been removed in other chapters.
    • Section 330(k)(3)(N) of the PHS Act adds a requirement for health centers to have written policies and procedures to ensure the appropriate use of federal funds. The statutory reference and related footnotes for Chapter 15: Financial Management and Accounting Systems have been updated consistent with this change. Changes were not needed for the Demonstrating Compliance elements because element (a) already requires health centers to demonstrate that they have written policies and procedures in place to ensure the appropriate use of federal funds in compliance with applicable federal statutes, regulations, and the terms and conditions of the federal award.
    • Section 330(k)(3)(B) of the PHS Act was amended and now requires health centers to establish and maintain collaborative relationships specifically with other health care providers, local hospitals, and specialty providers to provide access to services not available through the health center and to reduce the non-urgent use of hospital emergency departments. Language in the Requirements and the related Demonstrating Compliance elements (a), (b), and (c) in Chapter 14: Collaborative Relationships has been updated to align with this new statutory language.
  3. Have any other revisions or updates been made to the Compliance Manual or SVP?

    The Compliance Manual was updated to align with the amended Health Center Program statute. For the SVP, in addition to the updates made to align with the amended Health Center Program authorizing statute, HRSA also made minor revisions to the methodology for determining compliance in certain sections of the SVP to improve clarity.

    • Key Management Staff: Methodology revised to align with new statutory requirement for direct employment of the PD/CEO.
    • Clinical Staffing: Methodology revised to improve clarity when reviewing clinical staffing contracts.
    • Collaborative Relationships: Methodology revised to align with new statutory requirements for collaborative relationships.
    • Required and Additional Health Services, Sliding Fee Discount Program, Contracts and Subawards: Methodology revised to improve clarity when reviewing contracts. The same, clarified methodology is now in place for all three sections.
  4. Will HRSA make future updates to the Compliance Manual?

    HRSA remains committed to reviewing the Compliance Manual on a routine basis and, as deemed appropriate, proposing additional updates for public comment.

  5. When will HRSA begin utilizing the revised Compliance Manual and SVP to assess compliance?

    HRSA will begin assessing compliance with the new requirements included in the Health Center Program authorizing statute (Section 330 of the PHS Act as amended by the BBA) through the review of FY 2019 SAC and RD applications, as well as through Operational Site Visits (OSVs) that occur after September 6, 2018.

    The Health Center Program Compliance Manual, Site Visit Protocol and the Progressive Action Conditions library have all been updated to align with these statutory changes. See the list of Compliance Manual revisions (PDF - 583 KB).

  6. How did the BBA impact how HRSA makes project period length and award decisions based on compliance?

    The BBA amended the Health Center Program statute (Section 330 of the PHS Act) and added an increased emphasis on the impact of compliance with Health Center Program requirements on continued Health Center Program funding.

    These changes specify the length of project (or designation for Health Center Program look-alikes) periods awarded based on a health center’s demonstration of compliance with Health Center Program requirements. Beginning with FY 2019 application reviews, a 1-year project period will be awarded if a SAC or RD applicant is non-compliant with any Health Center Program requirement, consistent with the amended Section 330(e)(1)(B) of the PHS Act (42 U.S.C. 254b(e)(1)(B)). An applicant will be awarded a 1-year project/designation period if the applicant has one or more Health Center Program requirement condition(s) at the time of the SAC/RD award, due to either unresolved prior conditions or new conditions applied based on the review of the health center’s SAC/RD application.

    No award will be made if a SAC or RD applicant received a 1-year project/designation period in the previous two years (FY 2017 and FY 2018) and meets the criteria in the Notice of Funding Opportunity (NOFO) for what would be a third, 1-year project period in FY 2019.

    If a Competing Continuation applicant is fully compliant at the time of the SAC/RD award, the applicant will be awarded a 3-year project/designation period.

  7. Does the BBA also impact Health Center Program look-alikes?

    Yes, the statutory changes resulting from the BBA are also applicable to Health Center Program look-alikes. Consistent with determination of Health Center Program awardee project periods, the length of designation periods for Health Center Program look-alikes will be based on a health center’s demonstration of compliance with Health Center Program requirements. Beginning with FY 2019 application reviews, a 1-year designation period will be awarded if a RD applicant is non-compliant with any Health Center Program requirement, consistent with the amended Section 330(e)(1)(B) of the PHS Act (42 U.S.C. 254b(e)(1)(B)).

    No designation will be made if an RD applicant received a 1-year designation period in the previous two years (2017 and 2018) and meets the criteria in the RD Application Instructions for what would be a third, 1-year designation period in 2019.

  8. When does HRSA make project period length decisions for current health center awardees and look-alikes?

    HRSA determines project period length when making SAC awards and renewals of look-alike designation. Project period length determinations are based on criteria included in the applicable SAC NOFO and RD instructions. Health centers that are determined to be compliant based on the review of the SAC/RD application and do not have unresolved conditions related to Health Center Program requirements will be awarded a 3-year project period.

  9. When does HRSA typically identify areas of non-compliance that would result in the placement of a condition on a Health Center Program award or look-alike designation?

    Non-compliance is primarily identified through OSV findings and through the review of SAC or RD applications. When HRSA identifies non-compliance, a condition is applied to the award or look-alike designation. HRSA encourages all health centers to utilize the Compliance Manual and Site Visit Protocol and related resources to resolve any active conditions and to prepare for upcoming SAC/RD applications and OSVs.

  10. Will HRSA shorten a health center project period length as a result of OSV findings?

    HRSA will not shorten a project period as a result of OSV non-compliance finding(s). OSVs generally occur at the mid-point of a project period. Project period determinations are made at the time of service area competition or renewal of designation awards. Consistent with current practice, a project period will be shortened when a health center fails to adequately address conditions through the Progressive Action process or when HRSA determines that an immediate enforcement action is necessary. In such cases, HRSA may utilize available remedies, including terminating all or part of the federal award/designation before the health center’s current project end date. See Chapter 2: Health Center Program Oversight of the Health Center Program Compliance Manual for additional information.

BBA Program Requirement Changes

  1. Do health centers have to directly employ a Project Director/Chief Executive Officer (PD/CEO)?

    Revisions based on amendments to Section 330(k)(3)(H)(ii) of the PHS Act now require a health center to directly employ the PD/CEO. Please review Chapter 11: Key Management Staff, in the Compliance Manual and the SVP for more information.

  2. How does HRSA define “directly employed by the center” in the context of the new statutory requirement that the health center director (also often known as the health center PD or CEO) be directly employed?

    The Health Center Program authorizing statute, Section 330(k)(3)(H)(ii) of the PHS Act, now requires that a health center “directly employ” its PD/CEO. The statutory language is clear, and HRSA does not currently plan to issue regulatory interpretation. Therefore, a health center would demonstrate compliance with this statutory requirement that the PD/CEO be “directly employed by the center” by showing that the PD/CEO: (1) receives a salary directly from the health center, (2) is issued a W-2 that lists only the health center as the PD/CEO’s employer, and (3) has an employment agreement entered into with the health center that outlines the activities required to be performed by the PD/CEO.

  3. Who does HRSA consider to be the PD/CEO in the context of the new statutory requirement that the "director for the center...shall be directly employed by the center?" For example, what happens if the PD of record is not the CEO, as some health centers have both a CEO and a separate PD?

    The HRSA Health Center Program regulations at 42 CFR part 51c refer interchangeably to the “Project Director (PD)” and “Chief Executive Officer (CEO).” Under the Uniform Administrative Requirements for HHS Awards at 45 CFR 75.2, the term “Principal Investigator/Program Director (PI/PD)” means the individual(s) designated by the recipient to direct the project or program supported by the grant. Similarly, under the HHS Grants Policy Statement (p. I-6), the PD “is the individual designated by the recipient, responsible for the … programmatic aspects of the grant and for day-to-day management of the project or program.”

    The Health Center Program interprets PD/CEO as being synonymous with PI/PD. As such, the PD/CEO is the person who is responsible for directing the project and responsible for the day-to-day management of the Health Center Program project.

    For the purposes of compliance with Health Center Program requirements, the health center’s PD/CEO is an individual who:

    • is directly employed by the health center;
    • is selected by the health center’s governing board;
    • reports to the health center’s governing board; and 
    • is responsible for overseeing other key management staff in carrying out the day-to-day activities necessary to fulfill the HRSA-approved scope of project.

    If an organization that receives Health Center Program funding or designation chooses to utilize an organizational structure that has both a CEO position and a separately identified “PD” position then the organization would need to be able to demonstrate that the PD for the Health Center Program project, rather than the CEO, fulfills all applicable requirements noted above, including documenting that this PD is directly employed by the health center. Health centers should contact their HRSA Project Officer to address any related questions.

  4. How does the new statutory requirement for direct employment of the PD/CEO apply to health centers that are public agencies with co-applicant boards?

    To demonstrate compliance with the requirement for direct employment of the PD/CEO, a health center, including a public agency health center, as the Health Center Program awardee/designee of record, must directly employ the PD/CEO. Use of a co-applicant structure for meeting Health Center Program governance requirements does not alter this requirement. Please refer to related requirements in Chapter 19: Board Authority regarding public agencies with co-applicants.

  5. Does the new statutory requirement for direct employment of the PD/CEO apply to health centers that have an interim PD/CEO in place during the search for a permanent, employed PD/CEO?

    The Health Center Program statutory requirement that a health center must directly employ its PD/CEO applies to any health center PD/CEO serving on an interim or permanent basis.

  6. If the PD/CEO of a health center changes, are there any requirements to request approval from HRSA?

    In accordance with grants management regulations (45 CFR 75.308(c)(1)(ii) and (iii)), in situations where a health center has a post-award change in the PD/CEO position, the health center must request and receive prior approval from HRSA in the following situations:

    • Where there is a change in a key person specified in the application or the federal award;
    • The approved PD/CEO will be disengaged from involvement in the Health Center Program project for any continuous period for more than 3 months; or
    • The approved PD/CEO will reduce time devoted to the project by 25 percent or more from the level that was approved at the time of award.

    Under the HHS Grants Policy Statement (GPS), health centers must provide written notification to the Grants Management Officer, and requests for prior approval must provide all information noted in the GPS (see HHS GPS, p. II-56).

Pursuant to Executive Order 13891, the information in this website does not bind the public, except as authorized by law or as incorporated into a contract.

Date Last Reviewed:  May 2019