First Regular Session Seventieth General Assembly STATE OF COLORADO INTRODUCED LLS NO. 15-0181.01 Bob Lackner x4350 HOUSE BILL 15-1238 HOUSE SPONSORSHIP Buck, SENATE SPONSORSHIP Cooke, House Committees Senate Committees Health, Insurance, & Environment Finance A BILL FOR AN ACT Concerning the creation of a credit against the state income tax for certain health care preceptors offering their professional services in health professional shortage areas. Bill Summary (Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://www.leg.state.co.us/billsummaries.) For income tax years commencing on or after January 1, 2015, but prior to January 1, 2022, the bill grants a preceptor, or a noncompensated health care professional in one of a number of specialized fields of health care practice, who personally provides a mentoring experience of personalized instruction, training, and supervision representing a full clinical rotation to an advanced graduate student seeking a professional degree in one of these fields, a credit against the state income tax in amounts specified in the bill for a tax year in which the preceptor undertakes such work in a health professional shortage area. The tax credit is increased if a portion of the preceptor's health care practice consists of a certain percentage of medicaid patients during the particular tax year as specified in the bill. The bill imposes an aggregate limit on the amount of the credit to be awarded any one taxpayer for any one income tax year. The bill specifies the manner in which the taxpayer is required to apply for the credit and procedures to be followed if a preceptor fails to satisfy the requirements of the bill for a particular tax year. If the amount of the credit allowed exceeds the amount of the income tax otherwise due, the bill allows the balance to be carried forward and applied against the income tax due in each of the 5 succeeding income tax years. Be it enacted by the General Assembly of the State of Colorado: SECTION 1. In Colorado Revised Statutes, add 39-22-538 as follows: 39-22-538. Credit for health care preceptors working in health professional shortage areas - definitions - legislative declaration - repeal. (1) (a) The general assembly finds, determines, and declares that: (I) It is vital to the well-being, quality of life, and economic development of the entire state that excellent health care be available in all regions of the state; (II) The state currently suffers from a shortage of health care professionals in many areas of the state, and, as a result, these health professional shortage areas suffer from not having the breadth of health care professionals that regularly practice in more urban areas of the state; (III) A consistent problem is a lack of professional instruction, training, and supervision in health professional shortage areas that allows students studying in these areas to obtain the requisite professional mentoring and supervision to allow them to practice in such areas upon obtaining a professional degree and thereby provide the necessary scope of health care assistance required by the residents of shortage areas. (b) The intended use of the tax credit created in this section is to provide sufficient financial incentives to encourage preceptors to offer professional instruction, training, and supervision to students seeking careers as health care professionals in health professional shortage areas in the state. (c) This section is intended to serve as an initial step in providing sufficient incentives to enable preceptors to offer mentoring, teaching, and training services to students in underserved areas of the state and, insofar as this section succeeds in achieving its objectives, the general assembly hopes to be able to expand the scope of this section in future years consistent with health care needs across the state and the state's fiscal realities. (2) As used in this section, unless the context otherwise requires: (a) "Colorado area health education program" or "CAHEP" means the program administered by the university of Colorado at the Anschutz medical campus. The Colorado area health education program is a network that provides multidisciplinary educational services to students, faculty, and medical practitioners in local communities. The program divides the state into six regions with an area health education center office in each region. (b) "Health professional shortage area" means an area that the secretary of the United States department of health and human services has designated as a health professional shortage area pursuant to section 254e of the federal "Public Health Service Act". (c) "Preceptor" means a noncompensated physician, dentist, physical therapist, advanced practice registered nurse, physician assistant, or pharmacist who: (I) Has a faculty appointment at an accredited Colorado institution of higher education; and (II) Personally provides a minimum of one and a maximum of five preceptorships to one or more students in a health professional shortage area in a particular income tax year. (d) "Preceptorship" means a mentoring experience in which a preceptor provides a program of personalized instruction, training, and supervision representing a full clinical rotation that is approximately one month in duration to a graduate student certified to provide health care services as required to enable the student to obtain his or her professional degree. The one-month clinical rotation must be completed within one academic term or semester, but it is not a requirement of this section that the rotation be completed over any particular number of consecutive days. (e) "Student" means an individual matriculating at the graduate level at an accredited Colorado institution of higher education in the area of medicine, advanced practice registered nursing, dentistry, physician assistantship, mental health, physical therapy, or pharmacy. (f) "Taxpayer" means a preceptor who files an income tax return under this article. (3) (a) For income tax years commencing on or after January 1, 2015, but prior to January 1, 2022, and subject to the requirements of paragraph (b) of this subsection (3), a taxpayer is allowed a credit against the income taxes imposed by this article in an amount equal to: (I) One thousand dollars for any preceptorship provided by the preceptor during the tax year for which the credit is claimed; and (II) One thousand five hundred dollars for any preceptor if not less than ten percent of his or her health care practice consists of seeing medicaid patients during the particular tax year in addition to satisfying all applicable requirements imposed upon a preceptor pursuant to this section. (b) Notwithstanding any other provision of this section, the aggregate amount of the credit awarded to any one taxpayer under this section shall not exceed five thousand dollars for any one income tax year. (4) Notwithstanding any other provision of this section, the credit allowed by this section is only allowed for one or more income tax years in which the taxpayer: (a) Personally provides a minimum of one and a maximum of five preceptorships to one or more students in a health professional shortage area during any such year; or (b) Satisfies the requirements of subparagraph (II) of paragraph (a) of subsection (3) of this section in addition to satisfying the requirements of paragraph (a) of this subsection (4). (5) To qualify for the credit provided by this section, the taxpayer shall submit a certification form with each income tax return. The form must be obtained from the particular regional office of the CAHEP, as described in paragraph (a) of subsection (2) of this section, in which the preceptor was working during the relevant income tax year, which office shall certify that the taxpayer has satisfied the requirements for allowance of the tax credit as specified in this section. CAHEP may charge the taxpayer a reasonable fee for providing such certification, which fee shall not exceed the lesser of the actual costs incurred by CAHEP in completing the certification or seventy-five dollars for each certification. (6) Where a taxpayer claims the credit provided by this section but fails to satisfy the requirements of this section during the income tax year for which the credit is claimed, the taxpayer shall repay the entire amount of the total credit that is attributed to him or her pursuant to this section. The taxpayer shall report the recapture required by this subsection (6) by increasing the taxpayer's income tax liability by the amount of the total credit claimed for the year in which the recapture occurs. (7) If the amount of the credit allowed pursuant to this section exceeds the amount of the income tax otherwise due on the taxpayer's income in the income tax year for which the credit is being claimed, the amount of the credit not used as an offset against income taxes in the income tax year is not allowed as a refund but may be carried forward and applied against the income tax due in each of the five succeeding income tax years, but must first be applied against the income tax due for the earliest of the income tax years possible. (8) Nothing in this section modifies or changes the definition of "public employee" specified in section 24-10-103 (4) (b) (II) and (4) (b) (V), C.R.S. SECTION 2. Act subject to petition - effective date. This act takes effect at 12:01 a.m. on the day following the expiration of the ninety-day period after final adjournment of the general assembly (August 5, 2015, if adjournment sine die is on May 6, 2015); except that, if a referendum petition is filed pursuant to section 1 (3) of article V of the state constitution against this act or an item, section, or part of this act within such period, then the act, item, section, or part will not take effect unless approved by the people at the general election to be held in November 2016 and, in such case, will take effect on the date of the official declaration of the vote thereon by the governor.