Title of Regulation: 12VAC5-520. Regulations Governing the Dental Scholarship and Loan Repayment Programs (amending 12VAC5-520-10, 12VAC5-520-80, 12VAC5-520-130, 12VAC5-520-150, 12VAC5-520-160, 12VAC5-520-170, 12VAC5-520-190, 12VAC5-520-200, 12VAC5-520-210; adding 12VAC5-520-155, 12VAC5-520-195, 12VAC5-520-205; repealing 12VAC5-520-20, 12VAC5-520-140).

Statutory Authority: §§ 32.1-12 and 32.1-122.9 of the Code of Virginia.

Public Hearing Information: No public hearing is currently scheduled.

Public Comment Deadline: June 24, 2022.

Agency Contact: Olivette Burroughs, Statewide Health Workforce Manager, Virginia Department of Health, 109 Governor Street, Richmond, VA 23219, telephone (804) 864-7431, FAX (804) 864-7440, or email olivette.burroughs@vdh.virginia.gov.

Basis: The regulation is promulgated under the authority of §§ 32.1-12, 32.1-122.9, and 32.1-122.9:1 of the Code of Virginia. Section 32.1-12 grants the State Board of Health the legal authority to make, adopt, promulgate, and enforce such regulations necessary to carry out the provisions of Title 32.1 of the Code of Virginia. Section 32.1-122.9 of the Code of Virginia directs the board to establish an annual dental scholarship for students in good standing at Virginia Commonwealth University. Section 32.1-122.9 of the Code of Virginia also directs the board to promulgate regulations to administer the scholarship program. Section 32.1-122.9:1 of the Code of Virginia directs the board to establish a dental loan repayment program for graduates of accredited dental schools who meet criteria determined by the board.

Purpose: In June of 2016, the Virginia Department of Health (VDH) conducted a periodic review of Regulations Governing the Dental Scholarship and Loan Repayment Programs (12VAC5-520). As a result of the review, VDH determined it was necessary to use the regulatory process to amend the regulation, as the regulatory chapter has not been comprehensively revised in over a decade. Further, this regulatory action is necessary to amend the regulation to conform to similar regulatory chapters. There are several scholarship and loan repayment programs administered by VDH and 12VAC5-520, as currently written, does not resemble those other programs. The regulatory action is essential to protect the health, safety, and welfare of citizens as 12VAC5-520 is currently out of date and is not consistent with other similar programs. This proposed regulatory action shall update the regulatory chapter and encourage the use of the scholarship and loan repayment programs, potentially leading to more dentists practicing within underserved areas within the Commonwealth of Virginia.

Substance: The substantive proposed changes are: (i) Definitions: add, remove, and update definitions; (ii) Administration of program: repeal an unnecessary section; (iii) Population and dentist data: update the Code of Federal Regulation reference to the proper section; (iv) Eligibility for scholarships and repayment awards: rename the section. Update the format of the section so that it resembles other similar regulatory chapters; (v) Scholarship and loan repayment award: repeal an unnecessary section; (vi) Number of applications per student, amount of scholarships, and selection criteria: rename the section. Minor technical amendments; (vii) How to apply: addition of a new section that is present in similar regulatory programs; (viii) Conditions of scholarships and contractual practice obligation: rename the section; update the format of the section to resemble other similar regulatory chapters; specify that obligated service must begin within 180 days of graduation rather than 90 days so that the timeframe is identical to other similar regulatory chapters; add the requirement that recipients may only take a total of four weeks of leave for personal reasons without written permission from the commissioner, which is a requirement that is present in other similar regulatory chapters; and movement of information regarding repayment to a new section; (ix) Special requests for approval: minor technical amendments; (x) Breach of contract: rename the section and update the format of the section so that it resembles other similar regulatory chapters; (xi) Deferment and waivers: addition of new section that consists of some language from the previous default section and update the format of the section so that it resembles other similar regulatory chapters; (xii) Repayment: addition of the requirement that a scholarship recipient shall pay a penalty in the event of default after graduation; (xiii) Fulfillment after default payments: addition of a new section; (xiv) Reporting requirements: update the format of the section so that it resembles other similar regulatory chapters; and (xv) general language and wording changes were also made for consistency and clarity.

Issues: The primary advantage of the proposed regulatory action is a potential increase in the availability of dentists in underserved areas, should this program be funded. Additionally, these underserved areas will be better positioned to retain qualified dentists due to the obligation created by accepting the scholarship or loan repayment funds. VDH does not foresee any disadvantages to the public, the agency, or the Commonwealth associated with the proposed regulatory action.

Department of Planning and Budget's Economic Impact Analysis:

Summary of the Proposed Amendments to Regulation. As the result of a 2016 periodic review,¹ the State Board of Health (Board) proposes numerous amendments to the regulation governing the state dental scholarship and loan repayment programs. In addition to amending and adding language for improved clarity, the Board proposes amendments concerning: 1) eligibility to receive a scholarship, 2) when the dentist must start practice in a qualified location, 3) what constitutes a breach of contract, 4) the interest rate charged when scholarship or loan repayment award recipients fail to fulfill their commitment, 5) a penalty when scholarship recipients fail to inform the Virginia Department of Health (VDH) prior to dental school graduation that they will not fulfill their commitment, 6) how long VDH's commissioner may extend the repayment period for recipients in default, and 7) the conditions concerning reimbursement of repayment when a recipient fulfills their commitment after defaulting.²

Result of Analysis. Some proposed amendments produce a net benefit. The impact of other proposed amendments is indeterminate.

Estimated Economic Impact Background. Pursuant to §§ 32.1-122.9 and 32.1-122.9:1 of the Code of Virginia respectively, the Commonwealth has established the dental scholarship and dental loan repayment award programs. These programs are intended to help provide additional dental services in underserved areas of Virginia. Scholarships are awarded to students enrolled in Virginia Commonwealth University School of Dentistry.³ Dentist loan repayment awards are granted to graduates of accredited dental schools.

As part of the contract agreement for receiving dental school scholarship funds, the recipient commits to after graduation continuously engaging in full-time dental practice in a dental underserved area of Virginia for a period of years equal to the number of annual scholarships received. The loan repayment award contract also requires the recipient dentist to continuously engage in full-time dental practice in an underserved area of Virginia for a period of years equal to the number of loan repayment awards received.

Currently neither program is funded.

Scholarship Eligibility. The Board proposes to add to the scholarship eligibility requirements that the candidate have a cumulative GPA of at least 3.0 and demonstrate financial need, which is verified by the Virginia Commonwealth University School of Dentistry's financial aid officer or authorized person as part of the application process. The proposal to require that the candidate have a cumulative GPA of at least 3.0 is likely beneficial since state funds are best invested in more successful students who are more likely to graduate and be capable of fulfilling the commitment to provide dental care to underserved portions of the Commonwealth.

Required Start of Practice. Under the current regulation the recipient must begin practice in a dental underserved area within 90 days of graduation to not be in default. The Board proposes to amend the deadline to 180 days. The main intent of the programs is to increase dental service in underserved areas. To the extent that some newly minted dentists who do intend to fulfill their contract commitment may have trouble beginning practice in an underserved area within three months of graduation, the proposed amendment may be beneficial in that may help some recipients so serve and not default.

Breach of Contract. The Board proposes to specify that scholarship and loan repayment award recipients are in breach of contract: 1) if they falsify or misrepresent information on the program application, the verification of employment forms, or other required documents, or 2) if their employment is terminated for good cause as determined by the employer and confirmed by VDH. If employment is terminated for reasons beyond the participant's control (e.g. closure of site), the participant shall transfer to another site approved by the Board in the Commonwealth within six months of termination. Failure of participant to transfer to another site shall be deemed to be a breach of the contract. These situations would be considered breach of contract by the Board whether or not the language is specified in the regulation; nevertheless, having the language in regulation may help the Board enforce rules that would increase the likelihood that it can maximize the amount of quality dental care provided in underserved areas.

Interest Rate. When scholarship and loan repayment award payment recipients fail to fulfill their commitment, they are required to pay back their award plus interest. Under the current regulation, the interest rate is set at "the prime lending rate plus 2.0%." The Board proposed to amend the stated interest rate in the regulation to "the legal rate of interest pursuant to § 6.2-302 of the Code of Virginia." That statute states that "The judgment rate of interest shall be an annual rate of six percent, except that a money judgment entered in an action arising from a contract shall carry interest at the rate lawfully charged on such contract, or at six percent annually, whichever is higher." Considering that the statute is already in effect, under the current regulation the interest rate to be paid by recipients in default is the prime lending rate plus 2.0% or 6.0%, whichever is higher. As of the time that this report is being written, June 30, 2017, the prime lending rate is 4.25%. Thus by the current rules the interest rate to be paid by recipients in default would be 6.25%. The proposed regulation effectively sets the interest rate to be paid by those in default at 6.00%, regardless of the prime rate.

Penalty. The Board proposes to assess a penalty of three times the amount of all monetary scholarship awards paid to the scholarship recipient plus interest when the scholarship recipient fails to inform VDH prior to dental school graduation that he will not fulfill his commitment. A scholarship recipient who notifies VDH in writing that he will not practice dentistry in Virginia as required by his contract would be required to repay the total amount of scholarship funds received plus interest, but no penalty. This proposed penalty gives the scholarship recipient strong incentive to notify VDH of their change in plans before graduation.

Repayment Period Extension. When it is determined that a scholarship or loan repayment award recipient has failed to fulfill their commitment and is deemed to be in default, the recipient is required to pay back the award plus interest. Under the current regulation, VDH's commissioner may in his discretion permit extension of the period of repayment for up to two years from the date that the recipient is deemed to be in default. The Board proposes to change the permitted extension to "two years from the date that the recipient completes postgraduate training or the recipient enters into the full-time practice of dentistry, whichever is later." Effectively this in many cases would reduce the length of time that the commissioner may extend the repayment period for recipients in default, since the date that the recipient completes postgraduate training or the recipient enters into the full-time practice of dentistry would often be before the date of default.

Post-Default Commitment Fulfillment. The current regulation provides that should the scholarship recipient default and consequently pays back the value of their scholarship plus interest, but later does fulfill the commitment of serving his scholarship obligation in an underserved area within five years of having paid the restitution, that the recipient will be reimbursed for all or part of any scholarship award paid based on the fulfillment of the scholarship and availability of funds. The Board proposes to instead remove the five-year deadline, reduce the reimbursement by "applicable interest and fees," and include loan repayment awardees along with scholarships recipients in the opportunity for reimbursement. The proposed amendment to remove the five-year deadline would be beneficial in that it would provide incentive for dentists who are further along in their careers to come back and provide dental service in an underserved area. It would add uncertainty for the state to know when it may require funds for reimbursement though. Reducing the reimbursement by interest provides the incentive to provide the dental service sooner rather than later.

Businesses and Entities Affected. The state dental scholarship and loan repayment programs are currently not funded. If the programs were to be funded, the proposed amendments would affect dental practices in dental underserved areas,⁴ patients in underserved areas, the Virginia Commonwealth University School of Dentistry, and dentists and dental students desiring to work in underserved areas in return for a dental scholarship or loan repayment.

Localities Particularly Affected. If the state dental scholarship and loan repayment programs were to be funded, the proposed amendments would particularly affect localities that have relatively lower per capita dental care available.

Projected Impact on Employment. The proposed amendments are unlikely to significantly affect total employment.

Effects on the Use and Value of Private Property. The proposed amendments are unlikely to significantly affect the use and value of private property.

Real Estate Development Costs. The proposed amendments do not affect real estate development costs.

Small Businesses:

Definition. Pursuant to § 2.2-4007.04 of the Code of Virginia, small business is defined as "a business entity, including its affiliates, that (i) is independently owned and operated and (ii) employs fewer than 500 full-time employees or has gross annual sales of less than $6 million."

Costs and Other Effects. The proposed amendments do not significantly affect costs for small businesses.

Alternative Method that Minimizes Adverse Impact. The proposed amendments do not adversely affect small businesses.

Adverse Impacts:

Businesses. The proposed amendments do not adversely affect businesses.

Localities. The proposed amendments do not adversely affect localities.

Other Entities. The proposed amendments do not adversely affect other entities.

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¹More information about the periodic review can be viewed on the Virginia Regulatory Town Hall (Town Hall) at http://townhall.virginia.gov/L/ViewPReview.cfm?PRid=1502.

²The current proposed language eliminates the Virginia Department of Health from the list of state agency facilities where a dentist can practice and fulfill their commitment. VDH staff indicated that this amendment is currently being reconsidered.

³Virginia Commonwealth University has the only dental school in Virginia.

⁴The proposed definition for "dental underserved area" is 1) a geographic area in Virginia designated by the Board as a county or city in which the ratio of practitioners of dentistry to population is less than that for the Commonwealth as a whole; 2) those cities and counties determined to be dental health professions shortage areas as defined by the U.S. Department of Health and Human Services or designated a federal shortage area for the practice of dentistry as outlined in 42 CFR 5.1; or 3) a designated state facility.

Agency's Response to Economic Impact Analysis: The Virginia Department of Health concurs with the economic impact analysis prepared by the Department of Planning and Budget on the proposed amendments to the regulation with the exception that under "Penalty" in 12VAC5-520-200 B, the board proposes to assess a penalty of two times the amount of all monetary scholarship awards paid to the recipient plus interest. The proposed penalty is not, as stated in the analysis, three times the amount of all monetary scholarship awards paid to the recipient.

Summary:

The proposed amendments make the regulation consistent with similar scholarship award programs and include (i) corrections to the definitions of terms; (ii) clarifications to regulatory provisions; (iii) reorganization of the regulatory chapter conforming it to similar programs; and (iv) updates to language regarding how to apply to the program and to penalties to be paid in the event a recipient defaults after graduation.

12VAC5-520-10. Definitions.

The following words and terms when used in this chapter shall have the following meanings unless the context clearly indicates otherwise:

"Accredited dental school" means any dental school in the United States receiving accreditation from the Commission on Dental Accreditation.

"Accredited residency" means an advanced dental education program in general or specialty dentistry accredited by the Commission on Dental Accreditation and approved by the American Dental Association.

"Board" or "Board of Health" means the State Board of Health.

"Commissioner" means the State Health Commissioner.

"Dental practice" means the practice of dentistry by a recipient in general or specialty dentistry in a geographic area determined location within Virginia that is designated as a dental underserved area to be fulfillment of the recipient's scholarship or loan repayment obligation or practice as a dentist within a designated state facility.

"Dental student" means an individual who is studying the practice of general or specialty dentistry.

"Dental underserved area" means (i) a geographic area in Virginia designated by the State Board of Health as a county or city in which the ratio of practitioners of dentistry to population is less than that for the Commonwealth as a whole as determined by the commissioner or; (ii) a dental health professions professional shortage area using criteria described in Part II (12VAC5-520-80 et seq.) of this chapter; or (iii) a designated state facility.

"Dentist loan repayment program" means the program established by § 32.1-122.9:1 of the Code of Virginia that allocates funds appropriated in conjunction with the dental scholarship program to increase the number of dentists in underserved areas of Virginia.

"Department" means Virginia Department of Health.

"Designated state facility" means practice as a dentist in a facility operated by the Virginia Department of Health, Virginia Department of Behavioral Health and Developmental Services, Virginia Department of Juvenile Justice, or the Virginia Department of Corrections.

"Full-time dental practice" means the practice of dentistry for an average of a minimum of 32 hours per week for 48 weeks per year excluding those exceptions enumerated in Part III (12VAC5-520-160 et seq.) of this chapter.

"Interest at the prevailing bank rate for similar amounts of unsecured debt" means the prime lending rate plus 2.0% as published in the Wall Street Journal on the first day of the month in which the decision to repay is communicated to the commissioner by the recipient or on the first day of the month that the commissioner determines the recipient to be in default the legal rate of interest pursuant to § 6.2-302 of the Code of Virginia.

"Loan repayment award" means an award paid to a dentist for dental school loans in an amount equivalent to the current in-state tuition and mandatory fees at Virginia Commonwealth University School of Dentistry, and for which the dentist is under a contractual obligation to repay through practice in an a dental underserved area or designated state facility. This amount may be capped at the discretion of the commissioner.

"Practice of general or specialty dentistry" means the evaluation, diagnosis, prevention, and treatment (nonsurgical, surgical, or related procedures) of diseases, disorders, and conditions of the oral cavity, maxillofacial, and adjacent and associated structures and their impact on the human body.

"Recipient" means an eligible applicant who enters into a contract with the commissioner and participates in the scholarship or loan repayment program.

"Restitution" means three two times the award amount received plus interest at the prevailing bank rate for similar amounts of unsecured debt as set forth in this regulation, less any service obligation completed owed to the Commonwealth of Virginia by a scholarship or loan repayment award recipient who is in default of his contractual obligation as provided for in this chapter.

"Scholarship award" means an amount equivalent to one year of in-state tuition and mandatory fees at Virginia Commonwealth University School of Dentistry for the academic year a student is enrolled and for which the dental student entered a contractual obligation to repay through practice in an a dental underserved area or designated state facility. This amount may be capped at the discretion of the commissioner.

"Scholarship recipient" means an eligible dental student who enters into a contract with the commissioner and receives one or more scholarship awards from the Virginia Dental Scholarship Program.

"Specialty dentistry" means the advanced practice of dentistry in any specialty approved by the American Dental Association and accredited by the Commission on Dental Accreditation.

12VAC5-520-20. Administration of program. (Repealed.)

The State Health Commissioner, as executive officer of the Board of Health, shall administer this program. Any requests for deviation from the prescribed definitions shall be considered on an individual basis by the board in regular session.

12VAC5-520-80. Population and dentist data.

In order to determine the population-to-dentist ratio, the commissioner shall:

1. Use the population data or projections from the United States Census for independent cities, counties, and counties with independent cities within their boundaries;

2. Determine the number of practitioners of dentistry from data secured from the Virginia State Board of Dentistry and the American Dental Association, adjusting for those dentists licensed in Virginia but practicing in other states, the military, and retired dentists with active licenses;

3. Calculate this ratio every five years; and

4. Include as dental underserved areas those cities and counties determined to be dental health professions shortage areas as defined by the Department of Health and Human Services or designated a federal shortage area for the practice of dentistry as outlined in 42 CFR 5.1 42 CFR 5.2.

12VAC5-520-130. Eligible applicants Eligibility for scholarships and loan repayment awards.

A. Any currently enrolled dental student in good standing and full-time attendance at Virginia Commonwealth University School of Dentistry who has not entered the first year of an accredited residency shall be eligible for the Virginia Dental Scholarship Program. Preference for the scholarship award shall be given to residents of the Commonwealth, students who are residents of a dental underserved area, and students from economically disadvantaged backgrounds.

B. Any graduate of an accredited dental school in the United States who is establishing a practice in general or specialty dentistry in an underserved area or practicing dentistry in a designated state facility shall be eligible to apply for the Virginia Dentist Loan Repayment Program. General practice dentists will be within five years of graduation from an accredited undergraduate dental program and have existing loans accumulated as a result of their undergraduate dental program. Specialty practice dentists will be within five years of completion of their specialty training and have existing loans accumulated as a result of their undergraduate dental program. Dentists who received Virginia scholarship awards or other scholarships that paid their full tuition and fees are not eligible for the Dentist Loan Repayment Program for the years they received those awards.

A. An applicant for the Virginia Dental Scholarship Program must submit a completed application form and required documentation before the established deadline dates.

B. To be considered for the Virginia Dental Scholarship Program, an applicant must:

1. Be a United States citizen, a United States national, or a qualified alien pursuant to 8 USC § 1621;

2. Be currently enrolled, in good standing with a cumulative GPA of at least 3.0, which is verified by an appropriate grade transcript, and attend the Virginia Commonwealth University School of Dentistry;

3. Not have entered the first year of an accredited residency; and

4. Demonstrate financial need, which is verified by the school's financial aid officer or authorized person as part of the application process.

C. Preference for scholarships shall be given to:

1. Bona fide residents of Virginia as evidenced by being domiciled in the Commonwealth for at least one year as defined by § 23.1-502 of the Code of Virginia;

2. Students who are residents of a dental underserved area; and

3. Students from economically disadvantaged backgrounds.

D. An applicant for the Virginia Dentist Loan Repayment Program must submit a completed application form and required documentation before the established deadline dates.

E. To be considered for the Virginia Dentist Loan Repayment Program, an applicant must:

1. Be a United States citizen, a United States national, or a qualified alien pursuant to 8 USC §1621;

2. Be a graduate of an accredited dental school in the United States;

3. Secure employment at an approved practice site in general or specialty dentistry in a dental underserved area;

4. Be a general practice dentist within five years of graduation from an accredited dental program or a specialty practice dentist within five years of completion of specialty training;

5. Have existing loans accumulated as a result of the applicant's dental program;

6. Not have received Virginia scholarship awards or other scholarships that paid the applicant's full tuition and fees; and

7. Not have received a combined maximum of four scholarships or loan repayment awards.

F. Preference for loan repayment awards shall be given to Virginia Commonwealth University School of Dentistry graduates.

12VAC5-520-140. Scholarship and loan repayment award. (Repealed.)

A Virginia dental scholarship or loan repayment shall be awarded to the recipient upon or following the recipient's execution of a contract with the commissioner for scholarship or loan repayment by practicing dentistry in an underserved area or designated state facility as defined in this chapter.

12VAC5-520-150. Distribution of scholarships and loan repayment awards Scholarships and loan repayment awards details and selection criteria.

The Virginia General Assembly establishes the total combined appropriation for the dental scholarship and dentist loan repayment programs. Funds shall be awarded for these programs based on the following criteria:

1. Scholarship. The governing board of Virginia Commonwealth University School of Dentistry shall use the application procedure established by the commissioner and annually submit the names of qualified students to receive scholarships in accordance with the criteria for preference enumerated in 12VAC5-520-130. The total number of scholarship awards will shall be based on availability of funds. Scholarship awards will shall be made annually by October 30 to third-year and fourth-year dental students. First-year and second-year students will shall be considered for an award only in the event of extreme financial need. Individual scholarship recipients may receive a maximum of five four scholarship awards.

2. Loan repayment. The application period for the Dentist Loan Repayment Program will shall begin in October with awards made by the end of each fiscal year. Preference for loan repayment awards will shall be given to graduates of Virginia Commonwealth University School of Dentistry. Individual loan repayment award recipients may receive a maximum of four awards upon graduation from dental school. All awards will shall be competitive and will be based on availability of funds.

3. Scholarship and loan repayment. A combination of scholarship and loan repayment awards shall not exceed a total of four awards for any individual recipient.

12VAC5-520-155. How to apply.

Eligible applicants shall submit a complete application made available by the department on the department's website, www.vdh.virginia.gov. A complete application shall include documentation of all eligibility requirements. The deadline for submission of the application shall be announced by the department on the department's website.

12VAC5-520-160. Contractual practice obligation Conditions of scholarships, loan repayment awards, and contractual practice obligation.

A. Prior to the payment of money to becoming a scholarship or loan repayment award recipient, the applicant shall enter into a contract with the commissioner shall prepare and enter into a contract with the recipient. The contract shall:, agreeing to terms and conditions upon which the scholarship or loan repayment award is granted.

1. Provide B. The contract shall provide that the recipient of the scholarship award shall pursue the dental course of Virginia Commonwealth University until graduation and upon graduation or upon graduation from an accredited residency program that does not exceed four years,. For each scholarship received, the recipient agrees to engage in the equivalent of one year full-time dental practice in a dental underserved area of Virginia. The recipient shall notify the commissioner department in writing of his proposed practice location or intent to enter a residency not more than 30 days after graduation and begin his approved practice within 90 days after completing dental school or residency, and thereafter within 180 days of graduation from the dental course of Virginia Commonwealth University or upon graduation from an accredited residency program that does not exceed four years of the type of dental practice to be performed or intent to enter a residency. The notice shall include the name and address of the employer for approval. Thereafter the recipient shall continuously engage in full-time dental practice in a dental underserved area of Virginia or in a designated state facility for a period of years equal to the number of annual scholarships received. Dental practice in federal agencies, military service, or the U.S. Public Health Service may not be substituted for scholarship obligation.

2. Provide C. The contract shall provide that upon graduation from an accredited dental school and receiving notification of the dentist loan repayment award or residency program, the dentist shall begin his approved practice within 90 180 days and thereafter continuously engage in. For each loan repayment award received, the recipient agrees to engage in the equivalent of one year full-time dental practice in an a dental underserved area of Virginia or in a designated state facility for a period of years equal to the number of loan repayment awards received as designated by the State Board of Health.

3. Provide D. The contract shall provide that at any time prior to entering practice, the scholarship or loan repayment award recipient shall be allowed to select a future practice location from the listing of dental underserved areas maintained by the board.

4. Provide E. The contract shall provide that the recipient may request approval of a change of practice location. The commissioner in his discretion may approve such a request, but only if the change is to a practice location in a dental underserved area or a state facility designated by the State Board of Health.

5. Provide F. The contract shall provide that the recipient shall repay the scholarship or loan repayment obligation by practicing dentistry on a full-time basis in a dental underserved area, shall maintain office hours convenient for the population of the area to have access to the recipient's services, and shall participate in all government-sponsored insurance programs designed to ensure access to dental services of recipients of public assistance, including programs established pursuant to §§ 32.1-325 and 32.1-351 of the Code of Virginia. The recipient shall not selectively place limits on the numbers of such patients admitted to the practice.

6. Provide G. The contract shall provide that the scholarship recipient shall not voluntarily obligate himself for more than the minimum period of military service required of dentists by the laws of the United States and that upon completion of the minimum period of military service, the recipient shall promptly begin and thereafter continuously engage in full-time dental practice in a dental underserved area of Virginia or in a designated state facility for the period of years equal to the number of scholarships received. Dental practice in federal agencies, military service or the U.S. Public Health Service may not be substituted for scholarship obligation.

7. Provide that the recipient shall receive credit toward fulfillment of his contractual obligation at the rate of 12 months of dental practice for each scholarship or loan repayment award paid to the recipient. The recipient may be absent from the place of approved practice for a total of four weeks in each 12-month period for personal reasons. Absence for a period in excess of four weeks without the written permission of the commissioner shall result in proportional reduction of the period of credit toward fulfillment of the contractual obligation.

8. Provide that should the scholarship recipient pay restitution by not serving his scholarship obligation in an underserved area, and within five years of paying restitution fulfills the terms of his contract through dental practice as outlined in this section, that the recipient will be reimbursed for all or part of any scholarship award paid based on the fulfillment of the scholarship and availability of funds.

H. Absence for a period in excess of four weeks annually without the written permission of the commissioner shall result in proportional reduction of the period of credit toward fulfillment of the contractual obligation. The commissioner, in the commissioner's sole discretion, shall consider requests on an individual basis and determine the remaining fulfillment obligation.

12VAC5-520-170. Special requests for approval.

Special requests for approval of the practice of dentistry in an area in which the ratio does not meet the definition of an area of need a dental underserved area shall be considered by the State Board of Health on an individual basis. To obtain the board's approval, the scholarship or loan repayment award recipient shall substantiate to the board's satisfaction that the ratio does not correctly depict the provision of dental services in the city or county and that additional practitioners are necessary. Examples of situations deserving special consideration may include topography, age, or physical health of dental practitioners in the area, and sub-areas of high density population that can be geographically identified and shown to have a ratio less than the state ratio.

Part VI

Default Breach of contract

12VAC5-520-190. Default Breach of contract.

A. With respect to default, the contract shall provide that a scholarship or loan repayment recipient who fails to fulfill his obligation to practice dentistry as described in 12VAC5-520-160 shall be deemed in default under the following circumstances and shall forfeit all monetary scholarship or loan repayment awards made to him and shall repay the Commonwealth of Virginia as provided for in this chapter. The contract shall:

1. Provide that if the scholarship recipient defaults while still in dental school, by voluntarily notifying the commissioner in writing that he will not practice dentistry in a Virginia dental underserved area as required by his contract, by voluntarily not proceeding to the next year of dental education, or by withdrawing from dental school, the student shall pay the Commonwealth of Virginia all monetary scholarship awards plus interest at the prevailing bank rate for similar amounts of unsecured debt.

2. Provide that the scholarship recipient who defaults by failing to maintain grade levels that will allow the dental student to graduate, or by reason of his dismissal from dental school for any reason, shall repay the Commonwealth of Virginia all monetary scholarship awards plus interest at the prevailing bank rate for similar amounts of unsecured debt.

3. Provide that if the scholarship or loan repayment recipient is in default due to death or permanent disability so as not to be able to engage in dental practice, the recipient or his personal representative shall repay the Commonwealth all monetary awards plus 8.0% interest on the amount of the award. Partial fulfillment of the recipient's contractual obligation by the practice of dentistry as provided for in this contract prior to death or permanent disability shall reduce the amount of repayment plus interest due by a proportionate amount of money, such proportion being determined as the ratio of the number of whole months that a recipient has practiced dentistry in an approved location to the total number of months of the contractual obligation the recipient has incurred. The commissioner may waive all or part of the scholarship or loan repayment obligation under application by the recipient or his estate under these conditions and consider whole or partial forgiveness of payment or service in consideration of individual cases of hardship or inability to pay.

4. Provide that any recipient of a scholarship or loan repayment who defaults by evasion or refusal to fulfill the obligation to practice dentistry in an underserved area or designated state facility for a period of years equal to the number of annual scholarships or loan repayment awards received shall make restitution to the Commonwealth of Virginia.

B. A scholarship or loan repayment recipient will be considered to be in such default on the date:

1. The commissioner is notified in writing by the recipient that he does not intend to fulfill his contractual obligation;

2. The recipient has not accepted a placement and commenced his period of obligated practice as provided for in subdivisions 1 and 2 of 12VAC5-520-160; or

3. The recipient absents himself without the consent of the commissioner from the place of dental practice that the commissioner has approved for fulfillment of his contractual obligation.

A. A scholarship recipient shall be in breach of contract if:

1. The recipient fails to complete his dental studies;

2. The recipient fails to begin or complete the terms of obligated service under the terms and conditions of the scholarship contract;

3. The recipient falsifies or misrepresents information on the program application, the verification of employment forms, or other required documents; or

4. The recipient's employment is terminated for good cause as determined by the employer and confirmed by the department. If employment is terminated for reasons beyond the recipient's control (e.g., closure of site), the recipient shall transfer to another site in the Commonwealth approved by the board within 180 days of termination. Failure of recipient to transfer to another site shall be deemed to be a breach of the contract.

B. A loan repayment award recipient shall be in breach of contract if:

1. The recipient fails to begin or complete the term of obligated service under the terms and conditions of the loan repayment contract;

2. The recipient falsifies or misrepresents information on the program application, the verification of employment forms, or other required documents; or

3. The recipient's employment is terminated for good cause as determined by the employer and confirmed by the department. If employment is terminated for reasons beyond the recipient's control (e.g., closure of site), the recipient shall transfer to another site approved by the board in the Commonwealth within 180 days of termination. Failure of the recipient to transfer to another site shall be deemed to be a breach of the contract.

C. In the event of a breach of contract and in accordance with the terms of the contract, the recipient shall make payments as described in 12VAC5-520-200. In the event of a breach of contract where the recipient has partially fulfilled the recipient's obligation, the total amount of reimbursement shall be prorated by the proportion of obligation completed.

12VAC5-520-195. Deferment, waivers and variances.

A. Scholarship and loan repayment award recipients have the obligation to complete full-time continuous service for the period of their commitment. Under unusual circumstances as described in subsection C of this section, a recipient may request that the board agree to a deferment of the service obligation. This deferment, if granted, shall not relieve the recipient of the responsibility to complete the remaining portion of the obligation. Such deferment shall not be permitted as a matter of course, but may be allowed in the most compelling cases.

B. For recipients completing part of the scholarship or loan obligation prior to becoming permanently disabled or in the event of death, the total amount of the funds owed plus applicable interest shall be reduced by the proportion of obligated years served. The obligation to make repayment and restitution may be waived by the board upon application of the recipient or the recipient's personal representative to the board.

C. Individual cases of undue hardship may be considered for a variance by the board of payment or service pursuant to § 32.1-12 of the Code of Virginia.

D. All requests for deferments, waivers, or variances must be submitted in writing to the department for consideration and final disposition by the board.

12VAC5-520-200. Repayment.

A. Repayment requirements for scholarship and loan repayment award recipients are as follows:

1. Payment of restitution or repayment of award plus interest shall be due on the date that the recipient is deemed by the commissioner to be in default breach of contract.

2. The commissioner in his discretion shall permit extension of the period of repayment for up to 24 months two years from the date that the recipient is deemed to be in default breach of contract.

3. Partial fulfillment of the recipient's contractual obligation by the practice of dentistry as provided for in this the recipient's contract shall reduce the amount of restitution repayment by a percentage based on the number of whole months that the recipient has practiced dentistry in an approved location and the total number of months of the contractual obligation the recipient has incurred.

4. Failure of a recipient to make any payment on his debt when it is due shall be cause for the commissioner to refer the debt to the Attorney General of the Commonwealth of Virginia for collection. The recipient shall be responsible for any costs of collection as may be provided in Virginia law.

B. A scholarship recipient who commits a breach of contract while still in dental school by voluntarily notifying the commissioner in writing that the scholarship recipient will not practice dentistry in Virginia as required by the scholarship recipient's contract shall repay the total amount of scholarship funds received plus interest to the Commonwealth of Virginia. A scholarship recipient who commits a breach of contract after graduation shall pay a penalty of two times the amount of all monetary scholarship awards paid to the scholarship recipient plus interest, less any service obligation completed, to the Commonwealth of Virginia.

12VAC5-520-205. Fulfillment after breach of contract payments.

In the event that a recipient, in accordance with the terms of the contract, fully repays the Commonwealth for part or all of any scholarship or loan repayment award because of breach of contract and then later fulfills the terms of the contract after repayment, the Commonwealth shall reimburse the award amount repaid by the recipient minus applicable interest and fees. The award recipient shall request, in writing, the commissioner's approval to complete fulfillment as specified in the original terms of the contract.

12VAC5-520-210. Reporting requirements.

A. Reporting requirements of Virginia Commonwealth University School of Dentistry scholarship and loan repayment award recipients are as follows:

1. Virginia Commonwealth University School of Dentistry shall maintain accurate records of the enrollment and academic status of scholarship recipients until the recipient's graduation from dental school. The dental school shall provide a report listing the status of each recipient annually to the commissioner.

2. Each scholarship and loan repayment award recipient shall at any time provide information as requested by the commissioner to verify compliance with the contractual practice requirements obligation of the scholarship or loan repayment contract.

B. The recipient shall report any changes of mailing address, change of academic standing, change of intent to fulfill his contractual obligation and any other information that may be relevant to the contract at such time as changes or information may occur. The recipient shall respond within 30 days with such information as may be requested by the commissioner. notify the department in writing within 30 days if any of the following events occur:

1. Recipient changes name;

2. Recipient changes address;

3. Recipient changes practice site (a recipient is required to request in writing and obtain prior approval of changes in practice site);

4. Recipient no longer intends or is unable to fulfill service obligation as a dentist in the Commonwealth; or

5. Recipient ceases to practice as a dentist.

C. In addition to the requirements listed in subsections A and B of this section, scholarship award recipients shall also notify the department within 30 days if the following events occur:

1. Scholarship recipient changes dental program; or

2. Scholarship recipient ceases or no longer intends to complete his dental program.

FORMS (12VAC5-520)

Dental Scholarship and Loan Repayment Verification of Enrollment form (eff. 4/2022)

Dental Scholarship and Loan Repayment Verification of Financial Need form (eff. 4/2022)

Virginia Dental Scholarship and Loan Repayment Program Application (eff. 2022)