Legislature(2009 - 2010)HOUSE FINANCE 519

04/14/2009 08:30 AM FINANCE


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Delayed to 5 min. after Conf. Cmte. --
+ HB 204 POSTSECONDARY MEDICAL EDUC. PROG. TELECONFERENCED
Heard & Held
+ HB 222 MED. INS. ELIGIBILITY/NONDISCRIMINATION TELECONFERENCED
Moved Out of Committee
+ Bills Previously Heard/Scheduled TELECONFERENCED
HOUSE BILL NO. 204                                                                                                            
                                                                                                                                
     "An  Act increasing  the number  of students pursuing  a                                                                   
     medical   education  who   are  provided   postsecondary                                                                   
     educational services and  programs; and providing for an                                                                   
     effective date."                                                                                                           
                                                                                                                                
REPRESENTATIVE  NANCY DAHLSTROM,  SPONSOR,  related that  the                                                                   
bill  would  add  four  students  to  the  medical  education                                                                   
program.                                                                                                                        
                                                                                                                                
9:19:22 AM                                                                                                                    
                                                                                                                                
SAM  DIX, STAFF,  REPRESENTATIVE  NANCY DAHLSTROM,  explained                                                                   
that the  purpose of  the bill  is to  add four more  medical                                                                   
students and eventually  establish a 30-student  program.  It                                                                   
is an  attempt to maximize  the facilities at  the University                                                                   
of Alaska - Anchorage.                                                                                                          
                                                                                                                                
Vice-Chair Thomas asked if the  bill pertains only to medical                                                                   
doctors.  Mr.  Dix said that was correct.   Vice-Chair Thomas                                                                   
hoped  to see  the bill  expanded  to include  dentists.   He                                                                   
asked if the administration supports the bill.                                                                                  
                                                                                                                                
Representative  Dahlstrom  reported that  the  administration                                                                   
does support the bill.  She offered  to work on expanding the                                                                   
bill to include other areas.                                                                                                    
                                                                                                                                
Vice-Chair Thomas expressed frustration  and thought he might                                                                   
not support the bill.                                                                                                           
                                                                                                                                
9:21:38 AM                                                                                                                    
                                                                                                                                
Representative Dahlstrom offered to work on that problem.                                                                       
                                                                                                                                
Representative  Austerman  inquired  about  the cost  of  the                                                                   
program.   He  wondered,  since  it is  a loan  program,  why                                                                   
general  fund  dollars  would   be  needed.    Representative                                                                   
Dahlstrom stated that it was a loan forgiveness program.                                                                        
                                                                                                                                
9:23:02 AM                                                                                                                    
                                                                                                                                
DIANE  BARRANS, EXECUTIVE  DIRECTOR, POSTSECONDARY  EDUCATION                                                                   
COMMISSION,    DEPARTMENT   OF    EDUCATION,   agreed    with                                                                   
Representative  Austerman  that the  program  is funded  with                                                                   
state  general  funds.   The  existing  program  operates  in                                                                   
excess of $2 million a year.   She reported that it is a work                                                                   
obligation program  with a trigger if someone  in the program                                                                   
fails to return to Alaska.                                                                                                      
                                                                                                                                
Representative Austerman  asked how long the  obligation was.                                                                   
Ms. Barrans  replied that  students have 15  years to  pay if                                                                   
they fail  to return to the  state and provide three  to five                                                                   
years of service.                                                                                                               
                                                                                                                                
Representative  Austerman presented  an example  of a  doctor                                                                   
who returns to the state, provides  service, and has the loan                                                                   
forgiven.    Ms.  Barrans  agreed with  his  analysis.    She                                                                   
clarified  that   the  service  obligation  is   in  lieu  of                                                                   
repayment.                                                                                                                      
                                                                                                                                
9:24:38 AM                                                                                                                    
                                                                                                                                
Representative  Fairclough  reported  that she  followed  the                                                                   
bill last  year and  the discussions  in the HESS  committee.                                                                   
She asked  about the  dismal return rates  and wondered  if a                                                                   
residency program would help solve the program.                                                                                 
                                                                                                                                
Ms. Barrans  explained that past  return rates  proceeded the                                                                   
loan obligation  period of  the program.   The actual  return                                                                   
rate of Alaskans varied between  45 and 55 percent and should                                                                   
now increase.   Out  of state  WWAMI students  also chose  to                                                                   
participate  in  Alaska.   She  explained how  the  residency                                                                   
requirements work.   It takes  about seven years  to complete                                                                   
the  program.    The  cohort  of  students  that  would  have                                                                   
completed a three-year residency  in the fall of 2008 was the                                                                   
first group with the contractual service obligation.                                                                            
                                                                                                                                
9:27:27 AM                                                                                                                    
                                                                                                                                
Co-Chair  Hawker  asked  for more  information  about  return                                                                   
rates.                                                                                                                          
                                                                                                                                
DENNIS  VALENZENO,  DIRECTOR AND  PROFESSOR,  WWAMI  PROGRAM,                                                                   
UNIVERSITY OF ALASKA, ANCHORAGE,  via teleconference, related                                                                   
that  the return  rate  of Alaskans  is  actually quite  good                                                                   
compared to outside programs.   About 50 percent come back to                                                                   
the state  to practice.   Students coming  to the  state from                                                                   
other  states to  do short  clinical  experiences impact  the                                                                   
statistics.   The overall return  on the investment  is about                                                                   
88 percent  since the beginning of  the program in 1971.   It                                                                   
takes about seven  years to complete the program.   Residency                                                                   
is the  most important factor  as to where doctors  choose to                                                                   
practice.   Where students  go to school  is the  second most                                                                   
important  factor.   Through WWAMI  Alaska is  able to  offer                                                                   
three of the four years of medical school.                                                                                      
                                                                                                                                
9:30:39 AM                                                                                                                    
                                                                                                                                
Representative  Fairclough had  heard  a different  scenario.                                                                   
She wished to research the statistics further.                                                                                  
                                                                                                                                
Co-Chair  Hawker asked  if the  state would  benefit more  by                                                                   
increased  residency  programs or  by  more  students in  the                                                                   
WWAMI program.                                                                                                                  
                                                                                                                                
SUZANNE  TRIPP, DIRECTOR,  REGIONAL  PROGRAMS, UNIVERSITY  OF                                                                   
WASHINGTON  SCHOOL  OF MEDICINE,  via  teleconference,  first                                                                   
addressed Vice-Chair  Thomas's concerns about dentists.   She                                                                   
related that through the University  of Washington, there was                                                                   
an option for  developing dental programs in  Alaska based on                                                                   
the WWAMI model.                                                                                                                
                                                                                                                                
Ms. Tripp  turned to  the issue of  residency training.   She                                                                   
maintained that  it was  a huge factor  in WWAMI.   Residency                                                                   
programs  are  being  developed  currently.    She  spoke  of                                                                   
overcoming   obstacles   related  to   developing   residency                                                                   
programs in Alaska.   There needs to be  sufficient technical                                                                   
expertise, adequate  finances - based on Medicare  bed rates,                                                                   
and  enough  case volume  in  order  to  qualify to  take  on                                                                   
residents.  Branch  programs in pediatrics and  in psychiatry                                                                   
are currently  being developed.   Internal medicine  programs                                                                   
will be next.                                                                                                                   
                                                                                                                                
9:33:11 AM                                                                                                                    
                                                                                                                                
Representative  Fairclough summarized  that residency  is the                                                                   
number one factor.  She wished to check further.                                                                                
                                                                                                                                
Representative  Gara  agreed  with the  expansion  of  family                                                                   
practice  residency.   He voiced  support for  the bill.   He                                                                   
mentioned a  concern about an  acute shortage  of internists,                                                                   
family  care physicians,  and gerontologists.   He  suggested                                                                   
focusing scholarships in those areas.                                                                                           
                                                                                                                                
Representative  Dahlstrom  offered to  meet  to discuss  this                                                                   
issue and  to include  the Committee's  concerns.   She added                                                                   
that she has concerns  with lack of medical care  in parts of                                                                   
the state.                                                                                                                      
                                                                                                                                
9:36:22 AM                                                                                                                    
                                                                                                                                
Representative Gara said he was open to a conversation.                                                                         
                                                                                                                                
Co-Chair  Hawker  asked  for  an  opinion  of  Representative                                                                   
Gara's comments.                                                                                                                
                                                                                                                                
Mr.  Valenzeno  agreed  that targeting  an  area  of  medical                                                                   
practice was a  good idea.  He thought it would  be difficult                                                                   
to hold a student to that choice.   Representative Gara hoped                                                                   
there was a way to make it work.                                                                                                
                                                                                                                                
9:38:10 AM                                                                                                                    
                                                                                                                                
Representative Austerman  wondered whether  returning doctors                                                                   
are required to serve high-need areas or rural areas.                                                                           
                                                                                                                                
Ms.  Barrans   reported  that   there  is  an   incentive  to                                                                   
accelerate  the  discharge  of the  financial  obligation  by                                                                   
choosing a rural area.                                                                                                          
                                                                                                                                
9:39:12 AM                                                                                                                    
                                                                                                                                
Vice-Chair Thomas  asked what  the average obligation  to the                                                                   
state  was.  Ms.  Barrans said  it was  $90,000, which  would                                                                   
increase by  about 4 to 6 percent  per year.  That  amount is                                                                   
in addition to  about $100,000 of education  debt the student                                                                   
has already  incurred.  Vice-Chair  Thomas asked  if $190,000                                                                   
was  the amount  forgiven.   Ms. Barrans  explained that  the                                                                   
$100,000  was  owed  to  the   federal  government  or  other                                                                   
lenders.                                                                                                                        
                                                                                                                                
Vice-Chair  Thomas  wondered why  15  years  was allowed  for                                                                   
paybacks.   He suggested  the payback  be accelerated  if the                                                                   
student does not  return to the state.  Ms.  Barrans observed                                                                   
that collectability must be considered.   It is difficulty to                                                                   
leverage  an accelerated  repayment  on such  a large  amount                                                                   
without collateral.                                                                                                             
                                                                                                                                
9:41:56 AM                                                                                                                    
                                                                                                                                
Representative  Fairclough  inquired  about  the  delinquency                                                                   
rate  of the  loans.   Ms.  Barrans reported  that  currently                                                                   
there is zero delinquency.                                                                                                      
                                                                                                                                
Representative Austerman  asked about the  forgiveness period                                                                   
and amount collected.  Ms. Barrans  reported that $170,000 is                                                                   
the  amount collected  with  interest by  the  state if  they                                                                   
don't return and work in the state.                                                                                             
                                                                                                                                
Representative Austerman  asked if the $90,000  original loan                                                                   
was forgiven if the student returns  to the state to work for                                                                   
five years.  Ms. Barrans said that was correct.                                                                                 
                                                                                                                                
9:43:37 AM                                                                                                                    
                                                                                                                                
Representative  Salmon   asked  about  incentives   to  bring                                                                   
physicians to  come to Alaska to  work.  Ms. Barrans  was not                                                                   
aware of such a program.                                                                                                        
                                                                                                                                
Co-Chair Hawker opened public testimony.                                                                                        
                                                                                                                                
9:44:27 AM                                                                                                                    
                                                                                                                                
Ms. Tripp  clarified that the  average amount of debt  for an                                                                   
Alaska  WWAMI graduate  is about  $130,000  because they  pay                                                                   
tuition in  addition to state  support.  The amount  of money                                                                   
the  state   sends  to  the   University  of   Washington  is                                                                   
equivalent in context,  not amount, to the amount  of general                                                                   
fund  used  by  the  University  of Alaska.    It  makes  the                                                                   
partnership of  the University of Washington  and the state's                                                                   
medical  school, similar  to  any publically  funded  medical                                                                   
school.  The money  the state pays is not a  scholarship or a                                                                   
grant; it is  the state's support for medical  education.  In                                                                   
addition, students may receive  scholarships or loans and pay                                                                   
tuition to  the University of  Washington and  the University                                                                   
of Alaska.   Students usually  have more than  $200,000 worth                                                                   
of obligation upon completion  of their education.  In Alaska                                                                   
there is  a need  for primary  care physicians.   There  is a                                                                   
correlation between debt and the  type of medicine practiced.                                                                   
                                                                                                                                
9:46:39 AM                                                                                                                    
                                                                                                                                
Co-Chair Hawker closed public testimony.                                                                                        
                                                                                                                                
Co-Chair Hawker requested information  about the fiscal note.                                                                   
                                                                                                                                
Mr. Dix  explained that  in 2012  the total operating  budget                                                                   
would be $210,300.  For 2013 it  would be $425,200.  For 2014                                                                   
it would be $550,300 and for 2015 it would be for $557,400.                                                                     
                                                                                                                                
Co-Chair Hawker asked why it accelerates over the years.                                                                        
                                                                                                                                
Ms. Tripp related that it accelerates  because there are more                                                                   
students  in  the  program  every   year.    Co-Chair  Hawker                                                                   
concluded that it was a cumulative bill.                                                                                        
                                                                                                                                
9:48:37 AM                                                                                                                    
                                                                                                                                
Representative Gara  asked if the WWAMI subsidy  was for four                                                                   
years of  medical school, but  not for the residency  because                                                                   
the students would be getting  paid.  Ms. Tripp said that was                                                                   
correct.                                                                                                                        
                                                                                                                                
Representative Austerman inquired  if the amount was for four                                                                   
new students.   He asked if  there was already $2  million in                                                                   
the program.  Ms. Tripp said that was correct.                                                                                  
                                                                                                                                
Vice-Chair  Thomas  asked  if  the  fiscal  note  covers  the                                                                   
student  that has  an assistant.   Ms. Tripp  stated that  it                                                                   
does include all expenses.  Vice-Chair  Thomas asked how many                                                                   
more  teachers  would be  added.    Ms. Tripp  explained  the                                                                   
apprenticeship program  and how sites are found.   Additional                                                                   
persons are  then brought on,  however, she did not  know how                                                                   
many.                                                                                                                           
                                                                                                                                
9:50:57 AM                                                                                                                    
                                                                                                                                
Vice-Chair  Thomas thought  extra individuals  were hired  to                                                                   
supervise the students.  Ms. Tripp  recalled that there was a                                                                   
coordinator who would help students  navigate through medical                                                                   
school,  as well  as career  counselors.   In  the third  and                                                                   
fourth year additional supervisors  are involved.  Vice-Chair                                                                   
Thomas wanted  to know the costs  in addition to  funding the                                                                   
students.                                                                                                                       
                                                                                                                                
9:52:04 AM                                                                                                                    
                                                                                                                                
Representative  Joule wondered what  the shortage  of doctors                                                                   
would  look  like  without  this program.    He  asked  where                                                                   
residencies take  place.  Ms.  Tripp reported  that residency                                                                   
training can happen  in a number of sites,  determined by the                                                                   
population of  the town and  type of  residency.  One  of the                                                                   
requirements for pediatricians  is that a doctor be available                                                                   
on site  for training.   In  Bethel the  residents go  out to                                                                   
various rural sites for one month.                                                                                              
                                                                                                                                
Ms. Tripp addressed  the issue of physician  training and the                                                                   
physician shortage  in Alaska.  There  is a need for  30 more                                                                   
physicians  a  year  in  order to  address  the  shortage  of                                                                   
doctors in the state.  There are  currently 260 WWAMI doctors                                                                   
in  the state.   A  primary care  physician  has about  3,000                                                                   
patient visits a year.                                                                                                          
                                                                                                                                
Representative  Joule   thought  that  was  a   "pretty  good                                                                   
picture" of the situation.                                                                                                      
                                                                                                                                
9:54:58 AM                                                                                                                    
                                                                                                                                
HB  204  was   heard  and  HELD  in  Committee   for  further                                                                   
consideration.                                                                                                                  
                                                                                                                                
9:55:47 AM                                                                                                                    
                                                                                                                                

Document Name Date/Time Subjects
Frequently Asked Questions.pdf HFIN 4/14/2009 8:30:00 AM
HB 204
AARP.pdf HFIN 4/14/2009 8:30:00 AM
HB 204
HB222-DHSS-MS-04-11-09NEW.pdf HFIN 4/14/2009 8:30:00 AM
HB 222
HB222-DHSS-BHMS-04-11-09NEW.pdf HFIN 4/14/2009 8:30:00 AM
HB 222
HB 222 Sectional.pdf HFIN 4/14/2009 8:30:00 AM
HB 222
HB 222 Sponsor Statement.pdf HFIN 4/14/2009 8:30:00 AM
HB 222
Stateof AlaskaDeptHSS.pdf HFIN 4/14/2009 8:30:00 AM
HB 204
Sponsor Statement WWAMI (3).pdf HFIN 4/14/2009 8:30:00 AM
HB 204
Physician Shortage Fact Sheet Header.pdf HFIN 4/14/2009 8:30:00 AM
HB 204
HB 204 - Increase WWAMI Class Size.pdf HFIN 4/14/2009 8:30:00 AM
HB 204