Legislature(2007 - 2008)CAPITOL 106


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03:03:09 PM Start
03:05:25 PM HB55
03:09:38 PM HB18
04:16:07 PM Overview: Mentoring Project for Teachers and Principals - Department of Education and Early Development
04:44:49 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Moved CSHB 18(HES) Out of Committee
Heard & Held
+ Presentation by Department of Education: TELECONFERENCED
Mentoring Project for Teachers
and Principals
+ Bills Previously Heard/Scheduled TELECONFERENCED
HB 18-POSTSECONDARY MEDICAL & OTHER EDUC. PROG.                                                                               
[Contains discussion of HB 55.]                                                                                                 
3:09:38 PM                                                                                                                    
CHAIR WILSON announced  that the next order of  business would be                                                               
HOUSE BILL  NO. 18 "An Act  amending the functions and  powers of                                                               
the Alaska  Commission on  Postsecondary Education;  and relating                                                               
to   the  repayment   provisions   for   medical  education   and                                                               
postsecondary degree program participants."                                                                                     
3:09:41 PM                                                                                                                    
REPRESENTATIVE  SEATON  moved  to  adopt  CSHB  18,  Version  25-                                                               
LS0131\M, Mischel, 1/30/07.  There  being no objection, Version M                                                               
was before the committee.                                                                                                       
3:10:24 PM                                                                                                                    
REPRESENTATIVE KEVIN MEYER, Alaska  State Legislature, as sponsor                                                               
of  HB 18,  explained  that  the number  of  students allowed  to                                                               
attend  the  WWAMI  program  hasn't   been  changed  since  1971.                                                               
However, the state's population  and medical needs have increased                                                               
significantly  since  that time.    He  explained that  currently                                                               
those attending  the WWAMI  program pay  the in-state  tuition at                                                               
the University  of [Washington] and  the state pays for  the out-                                                               
of-state  portion  of the  charges.    This legislation,  HB  18,                                                               
proposes  forgiving  up  to  20 percent  each  year  the  student                                                               
[practices] in Alaska.   In other words, if a  student returns to                                                               
Alaska for five years, the  state will forgive the entire out-of-                                                               
state  portion.   The thought  is  that [after  five years],  the                                                               
physician would be  established with a clientele  that would keep                                                               
that physician in  Alaska.  Representative Meyer  opined that the                                                               
WWAMI  program has  been very  successful.   In  fact, one  study                                                               
shows  that almost  80 percent  of the  students who  utilize the                                                               
WWAMI  program  return   to  Alaska  as  physicians.     He  then                                                               
highlighted that the  proposal in HB 18 will  allow the residency                                                               
program to  occur outside of  Alaska.  This program  is important                                                               
and the cost incurred to utilize it is well worth it, he opined.                                                                
3:13:28 PM                                                                                                                    
MIKE  PAWLOWSKI,  Staff  to Representative  Kevin  Meyer,  Alaska                                                               
State Legislature, began by stating  that the changes encompassed                                                               
in Version  M are meant to  bring HB 18  and HB 55 together.   He                                                               
then paraphrased from a written  statement, which read as follows                                                               
[original punctuation provided]:                                                                                                
     Section 1:  Replaced section  one of HB 18 with section                                                                    
     1 of HB  55 and inserted clarifying language  on line 9                                                                    
     that  specifies the  program should  admit at  least 20                                                                
     participants each year.                                                                                                    
     Section 2:   Replaced one-third  on page 2 line  7 with                                                                
     50  percent (new  page  2  line 6)  to  bring the  base                                                                
     obligation a  program participant accrues in  line with                                                                    
     existing statute.                                                                                                          
     Replaced    "student"   with    "program   participant"                                                                    
     throughout section  2 to better  reflect the  status of                                                                    
     person under  the WWAMI program since  a person serving                                                                    
     their  residency is  still under  the  program but  not                                                                    
     technically a student.                                                                                                     
3:15:29 PM                                                                                                                    
REPRESENTATIVE SEATON  drew attention to  Section 1 of  Version M                                                               
and asked if there are  limitations on the WWAMI slots available.                                                               
In other words, are there 20  slots in WWAMI per year for Alaskan                                                               
students, he asked.                                                                                                             
MR. PAWLOWSKI deferred to upcoming  witnesses who will testify as                                                               
to the number  of slots available and  the overall implementation                                                               
of the WWAMI program.                                                                                                           
3:16:10 PM                                                                                                                    
MR. PAWLOWSKI,  in response to Representative  Gardner, explained                                                               
that  under  Version  M,  interest   doesn't  accrue  during  the                                                               
residency program outside  of the state.  Version M,  with the 50                                                               
percent,  attempts to  bring in  line the  state subsidy  and the                                                               
difference between  resident and nonresident tuition.   The state                                                               
subsidy per WWAMI  student is in and around $50,000  a year.  The                                                               
difference  between resident  and  nonresident  tuition is  about                                                               
$25,000 per  year.  "In the  current program there was  always an                                                               
implicit subsidy in  there and I think the  rationale behind that                                                               
is if  you consider whether or  not tuition ever covers  the cost                                                               
of educating  a student, and it  doesn't.  There's a  GF [general                                                               
fund] in the University of  Alaska system ... increment that will                                                               
pay  for   the  corresponding   state  responsibility   for  that                                                               
student," he explained.  Since  WWAMI is Alaska's medical school,                                                               
the remainder  of the  obligation is the  state's part  of paying                                                               
for  that student.   Therefore,  the  difference is  in terms  of                                                               
3:18:02 PM                                                                                                                    
REPRESENTATIVE GARDNER  asked if those students  who don't return                                                               
to Alaska currently  are responsible for the full  $50,000 a year                                                               
or only half of it.                                                                                                             
MR. PAWLOWSKI  specified that  it works out  to about  half under                                                               
the current program and the proposed program.                                                                                   
3:18:39 PM                                                                                                                    
REPRESENTATIVE  FAIRCLOUGH  highlighted that one of  the goals is                                                               
retention of physicians.   She then inquired as  to whether there                                                               
is a  chart illustrating  the retention  level of  physicians who                                                               
utilize WWAMI, stay in the Alaska, and practice in Alaska.                                                                      
MR.  PAWLOWSKI related  that  the report  should  include such  a                                                               
chart.    He  offered  to locate  the  chart  for  Representative                                                               
3:19:43 PM                                                                                                                    
REPRESENTATIVE  FAIRCLOUGH,  referring  to the  report  from  the                                                               
Alaska Physician Supply Task Force,  echoed the earlier mentioned                                                               
difference  between  the ratio  of  physicians  to population  in                                                               
Alaska  versus  the  national  average.     However,  the  report                                                               
indicates that Alaska is above  the national average in regard to                                                               
the proportion  of nurse  practitioners and  physician assistants                                                               
per  population.   Therefore, she  inquired  as to  the ratio  of                                                               
nurse  practitioners  and  physician   assistants  per  1,000  in                                                               
population in Alaska.                                                                                                           
MR. PAWLOWSKI said he wasn't  sure, but suggested that others may                                                               
be able to respond.                                                                                                             
3:21:01 PM                                                                                                                    
REPRESENTATIVE FAIRCLOUGH,  referring to the issue  of retention,                                                               
asked if  there has  been consideration  given to  shortening the                                                               
repayment fee by  moving from a 20 percent over  five years to 25                                                               
percent over four years.                                                                                                        
REPRESENTATIVE   MEYER  said   that  he   hasn't  had   any  such                                                               
discussion.    He  reiterated  his   belief  that  the  longer  a                                                               
physician is in  the state and has  his/her business established,                                                               
the   more  likely   that  physician   will  remain   in  Alaska.                                                               
Therefore, it probably doesn't matter  much whether the repayment                                                               
occurs over the course of four or five years.                                                                                   
REPRESENTATIVE FAIRCLOUGH noted her  appreciation to the sponsors                                                               
for  being proactive  with regard  to health  care in  Alaska, in                                                               
which  the  fastest growing  population  is  over  age 65.    The                                                               
aforementioned is also impacting  medical providers in the state.                                                               
Representative Fairclough then stated  her support of the concept                                                               
of this legislation.                                                                                                            
3:22:59 PM                                                                                                                    
REPRESENTATIVE  SEATON   asked  if  the  language   referring  to                                                               
residing in  Alaska means that  the individual is eligible  for a                                                               
permanent  fund  dividend   (PFD).    He  further   asked  if  an                                                               
individual attending school outside of  Alaska who has an excused                                                               
absence for four years would be eligible for this program.                                                                      
MR. PAWLOWSKI deferred to Ms. Barrans.                                                                                          
3:24:36 PM                                                                                                                    
DENNIS  VALENZENO,  Ph.D.,   Director,  Alaska  WWAMI  Biomedical                                                               
Program,  University of  Alaska -  Anchorage (UAA),  informed the                                                               
committee that he is responsible  for the first year program that                                                               
is given at the University of  Alaska to the 10 Alaskans accepted                                                               
into  the  WWAMI  program,  the  pathway  programs  leading  into                                                               
medical education, as well as  the collaboration of the education                                                               
done  in Alaska  for the  third and  fourth year  students.   Dr.                                                               
Valenzeno highlighted that the Alaska  WWAMI program doesn't send                                                               
students  to  the  University  of  Washington  to  receive  their                                                               
medical education.  At this  time, students can complete three of                                                               
the four  years of medical school  in state.  Dr.  Valenzeno said                                                               
he  highlighted  the aforementioned  because  he  didn't want  to                                                               
overlook  the   educators  and  physicians  in   Alaska  who  are                                                               
providing an education.  Furthermore,  physicians do tend to stay                                                               
where they  are educated,  and thus it's  more likely  that those                                                               
physicians  educated  in   Alaska  will  stay  in   Alaska.    He                                                               
attributed  the  aforementioned  as  one of  the  reasons  Alaska                                                               
experiences nearly  85 percent  return on  this investment  in 10                                                               
slots as  compared to the  national average that's just  under 40                                                               
3:26:47 PM                                                                                                                    
DR. VALENZENO, in response to  Representative Seaton, pointed out                                                               
that with five states and  six institutions, a significant amount                                                               
of coordination  must occur  in order for  class size  to change.                                                               
He related that the program  can accommodate 20 students as early                                                               
as this  fall, but to  go beyond  20 students would  require some                                                               
"ramp-up"  time.     He  related   his  understanding   that  the                                                               
University  of  Washington  and  the  University  of  Alaska  are                                                               
available to accommodate [more than 20  students].  Of the 78 who                                                               
applied for the WWAMI program  this year, Dr. Valenzeno estimated                                                               
that 30-35 are well-qualified for acceptance.                                                                                   
3:28:05 PM                                                                                                                    
CHAIR WILSON asked  if classrooms are being  built to accommodate                                                               
20 students or will [the education] be done in shifts.                                                                          
DR.   VALENZENO  answered   that   current   classrooms  can   be                                                               
reconfigured  to accommodate  20 students.   However,  additional                                                               
study  space  would   be  needed  for  the   program,  which  the                                                               
university is addressing.  Beyond  20 students, the physical size                                                               
of the classroom and laboratory is limiting.                                                                                    
3:29:12 PM                                                                                                                    
REPRESENTATIVE FAIRCLOUGH asked if the  state has a contract with                                                               
the WWAMI  program.   She then pointed  out that  the legislation                                                               
before the committee utilizes "shall"  language.  She related her                                                               
understanding   that  the   contract  with   the  University   of                                                               
Washington  School  of Medicine  to  qualify  for 20  slots;  the                                                               
latitude is necessary  because other states in  the WWAMI program                                                               
are competing  for the vacant/new  slots.  She  acknowledged that                                                               
Alaska  can't be  guaranteed  the additional  10  slots, but  may                                                               
obtain an additional 1-10 slots.                                                                                                
DR.  VALENZENO   related  his  understanding  that   the  current                                                               
contract between  Alaska and the University  of Washington School                                                               
of Medicine  specifically states  that Alaska has  10 slots.   He                                                               
relayed that  representatives from  the University  of Washington                                                               
School of  Medicine have  stated that the  program can  accept 20                                                               
students  from Alaska.   In  further  response to  Representative                                                               
Fairclough, he  acknowledged that the  contract would need  to be                                                               
amended,  although  he  mentioned   that  he  didn't  have  legal                                                               
expertise on the matter.                                                                                                        
3:31:18 PM                                                                                                                    
ROD  BETIT, President,  Alaska State  Hospital  and Nursing  Home                                                               
Association (ASHNHA), noted that he  is also testifying on behalf                                                               
of a  partnership that  was formed  from two  different physician                                                               
groups in Providence  Hospital in order to highlight  some of the                                                               
access issues in the state.   He reminded the committee that this                                                               
[partnership]  drew attention  to the  shortage of  physicians in                                                               
the state.   He further  reminded the committee that  last year's                                                               
capital  budget  appropriations  provided funding  to  start  the                                                               
infrastructure improvements to increase  the WWAMI program at the                                                               
University  of Alaska  - Anchorage.   Mr.  Betit opined  that the                                                               
task  force  report  is  alarming  in  terms  of  the  number  of                                                               
physicians that  the state is  short currently and  the projected                                                               
numbers  over  the  next  10  years.   The  shortage  is  further                                                               
compounded by the  fact that current physicians desire  more of a                                                               
life  than those  at the  end of  their careers.   Therefore,  it                                                               
isn't  unrealistic  to  believe   that  1.5  physicians  will  be                                                               
required to  replace a retiring  physician.  He noted  that every                                                               
state is facing  this situation today.  As the  task force report                                                               
points out,  the state  needs to be  proactive and  aggressive to                                                               
attract the necessary number of  physicians from medical schools,                                                               
especially given the fact that  the number of students graduating                                                               
as  physicians isn't  keeping  pace  with the  need.   Mr.  Betit                                                               
opined that WWAMI is a great  program with an excellent return to                                                               
the state for its investment.   The proposal today, he opined, is                                                               
a critical step to begin to  fill the gap and should move forward                                                               
quickly  in  order  to  provide   the  University  of  Washington                                                               
assurance as  to Alaska's plans.   He  related that the  State of                                                               
Wyoming is also pursuing additional  slots from the University of                                                               
Washington.   In  conclusion, Mr.  Betit urged  the committee  to                                                               
pass  HB 18 from committee.                                                                                                     
3:35:24 PM                                                                                                                    
REPRESENTATIVE GARDNER asked whether  Mr. Betit is confident that                                                               
the additional  slots [at the  University of Washington]  will be                                                               
MR. BETIT related that there  has been considerable discussion on                                                               
this matter  over the last year  and a half.   Therefore, he said                                                               
he  was confident  those slots  would be  available if  the state                                                               
provides  the University  of Washington  assurance early  on that                                                               
such is the desire of the State of Alaska.                                                                                      
3:35:49 PM                                                                                                                    
REPRESENTATIVE  SEATON   returned  attention   to  Representative                                                               
Fairclough's earlier  comments regarding the task  force report's                                                               
assessment  of need.    He highlighted  the  finding that  Alaska                                                               
should maintain  a higher ratio  of mid-level providers,  such as                                                               
advanced nurse practitioners and  physician assistants.  He asked                                                               
if the legislation addresses the aforementioned need.                                                                           
MR. BETIT said  that to his knowledge nothing  in the legislation                                                               
addresses  that.   However, he  noted that  maintaining a  higher                                                               
ratio of mid-level  providers was something that  is necessary to                                                               
address the shortage discussed by the task force.                                                                               
3:37:25 PM                                                                                                                    
MARIE  DARLIN,   Coordinator,  AARP  Capital  City   Task  Force,                                                               
directed attention  to AARP's letter  in support of HB  18, which                                                               
should be in the committee packet.   She opined that WWAMI is one                                                               
way in  which to  address the shortage  of physicians  in Alaska.                                                               
Furthermore,  [increasing  the  number  of slots  in  the]  WWAMI                                                               
program  is one  way to  address the  many AARP  members who  are                                                               
unable  to  find  physicians  willing  to  accept  patients  with                                                               
Medicare.  She then highlighted  that the Alaska Physician Supply                                                               
Task Force suggested  that there be as many as  30 slots per year                                                               
in  the WWAMI  program.    In conclusion,  Ms.  Darlin urged  the                                                               
committee members to vote in favor of HB 18.                                                                                    
3:40:04 PM                                                                                                                    
SUZANNE  TRYCK,   Director,  Regional  Programs,   University  of                                                               
Washington School of Medicine, urged  the committee to pass HB 18                                                               
out of committee  today.  She explained that  this legislation is                                                               
timely because  the University of  Washington is  currently going                                                               
through  its  admissions  process.   Therefore,  the  sooner  the                                                               
legislation is  passed, the sooner  the University  of Washington                                                               
can invite more  Alaskans to join classes.  In  response to Chair                                                               
Wilson,  Ms.  Tryck confirmed  that  classes  for 2007  begin  in                                                               
September and thus  students are being admitted  into the program                                                               
3:41:08 PM                                                                                                                    
REPRESENTATIVE  FAIRCLOUGH  asked  if  Alaska has  to  amend  the                                                               
current contract  with the  State of Washington  in order  to add                                                               
these proposed new slots.                                                                                                       
MS.  TRYCK replied  yes, adding  that the  contract is  currently                                                               
under review.   The expectation,  she said, is that  the contract                                                               
will be in place in time  to offer the positions to the increased                                                               
class size.   In further  response to  Representative Fairclough,                                                               
Ms.  Tryck  related  the  preference  for  the  language  of  the                                                               
legislation to  provide latitude  [with regard  to the  number of                                                               
slots].  However, she informed  the committee that the University                                                               
of Washington has already committed to the extra 10 slots.                                                                      
3:42:45 PM                                                                                                                    
REPRESENTATIVE  SEATON asked  for  clarity with  regard to  which                                                               
commissioner the language in Section 1 of Version M refers.                                                                     
MS.  TRYCK  related  her  understanding that  it  refers  to  the                                                               
commissioner of the Commission on Postsecondary Education.                                                                      
3:43:32 PM                                                                                                                    
JOEL  GILBERTSON,  Regional  Director, Providence  Health  System                                                               
Alaska, reiterated the  importance of the passage of HB  18.  Mr.                                                               
Gilbertson then  related his personal  belief that  the physician                                                               
shortage in Alaska  is one of the largest public  health risks at                                                               
this  time.    Across  the   state,  including  Anchorage,  large                                                               
portions of  individuals aren't receiving timely  access to care,                                                               
continuity  in  care,  and strong  services  to  support  chronic                                                               
disease management.   The aforementioned results in  loss of care                                                               
for individuals  and creates an  inefficient health  care system.                                                               
The  WWAMI program  provides additional  man power  to provide  a                                                               
myriad of  health care services.   As has been  mentioned, almost                                                               
85 percent  of the  [Alaska] WWAMI  participants practice  in the                                                               
state.   He noted that  elements of HB  18 ensure that  such will                                                               
continue  in  the future  while  opening  the  door to  see  more                                                               
Medicare insured  patients.  In conclusion,  Mr. Gilbertson urged                                                               
passage of HB 18.                                                                                                               
3:46:26 PM                                                                                                                    
KAREN  PERDUE, Associate  Vice President,  University of  Alaska,                                                               
remarked that  being involved  in the  nursing expansion  and the                                                               
Physicians Supply  Task Force has  been a great experience.   The                                                               
University of  Alaska supports the  expansion embodied in  HB 18.                                                               
She confirmed that  the University of Alaska has  worked with the                                                               
University of Washington  to ensure that the  additional 10 slots                                                               
will  be available.    She mentioned  that  students wouldn't  be                                                               
admitted  in the  first year  of  the program  if the  university                                                               
didn't believe the  additional slots would be  available later at                                                               
the University of  Washington.  Ms. Perdue  then highlighted that                                                               
the fiscal  note for the university's  cost of the first  year of                                                               
the program  isn't in  the committee packet.   The  University of                                                               
Alaska  anticipates that  its  costs  for the  first  year of  10                                                               
additional students would be $280,000.   The aforementioned would                                                               
be a one-time cost and  doesn't accumulate as does the University                                                               
of Washington costs do.  The  fiscal note also includes a request                                                               
for  additional   capital  money   to  complete  and   equip  the                                                               
classroom.   Ms. Perdue related  the university's  strong support                                                               
of HB 18.                                                                                                                       
3:48:40 PM                                                                                                                    
CHAIR WILSON asked if the classroom  will only be utilized by the                                                               
medical students.                                                                                                               
MS.  PERDUE  said  she  doubted   that  the  classroom  would  be                                                               
available  to others  since the  medical students  really utilize                                                               
the room throughout the day.                                                                                                    
3:48:48 PM                                                                                                                    
REPRESENTATIVE  FAIRCLOUGH  requested information  regarding  the                                                               
administrative cost of the program.                                                                                             
MS. PERDUE said she would provide such information.                                                                             
3:49:26 PM                                                                                                                    
REPRESENTATIVE  SEATON noted  that the  committee was  provided a                                                               
summary  of  the  projected  costs  in  revenue  in  relation  to                                                               
doubling the size of the classroom.                                                                                             
MS.  PERDUE  explained that  the  summary  specifies the  capital                                                               
cost, of which  $475,000 was appropriated last  year.  Therefore,                                                               
the fiscal  note will  reflect that going  forward.   She further                                                               
explained  that   the  operating  costs  would   be  $280,000  as                                                               
specified on the projected revenue side.                                                                                        
3:50:24 PM                                                                                                                    
MIKE FORD, Alaska  Native Health Board, noted  his agreement with                                                               
earlier testimony that Alaska has  a very serious health problem.                                                               
The Alaska  Native Health  Board, he  related, views  HB 18  as a                                                               
step in the  right direction.  In fact, one  of the priorities of                                                               
the  Alaska  Native Health  Board  is  to develop  a  sustainable                                                               
workforce of  health care professionals  who will come  to Alaska                                                               
and stay in Alaska.  He, too, urged the committee to pass HB 18.                                                                
3:51:44 PM                                                                                                                    
CHAIR WILSON,  upon determining  no one  else wished  to testify,                                                               
announced that public testimony was closed.                                                                                     
3:51:59 PM                                                                                                                    
REPRESENTATIVE GARDNER related her  understanding that HB 18 says                                                               
that  students repay  the full  amount that  the state  has paid.                                                               
However, the  sponsor statement  for HB 18  says, "House  Bill 18                                                               
removes  the limit  on the  number of  students currently  set in                                                               
statute, decreases  the amount a  person is required to  pay back                                                               
if they  don't return to  Alaska ...."   Therefore, she  asked if                                                               
the  legislation increases  the amount  a student  has to  pay if                                                               
he/she doesn't return to Alaska.                                                                                                
3:53:24 PM                                                                                                                    
DIANE   BARRANS,  Executive   Director,   Alaska  Commission   on                                                               
Postsecondary  Education  (ACPE),  Department  of  Education  and                                                               
Early Development, clarified  that there is a change  in terms of                                                               
the  principal of  the loan,  although the  dollar amount  hasn't                                                               
changed.   She related  her understanding  that the  objective of                                                               
the task  force was to  make it concrete  with regard to  how the                                                               
principal  obligation was  determined.    Therefore, rather  than                                                               
have the  language of the  differential between the  resident and                                                               
the  nonresident tuition,  a  percentage  approximating the  same                                                               
amount  of   money  was  utilized.     Currently,  an  individual                                                               
graduating  from  the  WWAMI  program   this  year  will  have  a                                                               
principal obligation  of $76,000 on which  interest would accrue.                                                               
If  that graduate  failed to  return to  the state,  the graduate                                                               
would pay  the principal plus  the interest.  However,  Version M                                                               
takes 50  percent of  the state  support fee  and makes  that the                                                               
obligation, which amounts to about  $75,000.  With respect to the                                                               
interest,  there's  a  slight difference.    She  explained  that                                                               
currently interest  accrues at  the end  of the  graduate medical                                                               
education program,  but is deferred  until repayment.   Repayment                                                               
is postponed  until the  completion of  any residency  program or                                                               
period of  service to public  health, Indian health  services, or                                                               
the military.   This legislation changes  the aforementioned such                                                               
that the interest  doesn't begin to accrue  until the [completion                                                               
of any residency  program or period of service  to public health,                                                               
Indian health  services, or the  military].  She opined  that the                                                               
reasoning behind the change in  interest accrual is because there                                                               
isn't  an  opportunity  for  all   20  students  within  Alaska's                                                               
residency program.                                                                                                              
3:56:04 PM                                                                                                                    
REPRESENTATIVE SEATON referred  to the change on page  1, line 6,                                                               
from "may"  to "shall" and  posed a  situation in which  the ACPE                                                           
doesn't receive  enough funds  from the  legislature to  cover 20                                                               
students.    He asked  if  the  ACPE  is  concerned with  such  a                                                               
situation and whether it would place it in violation of the law.                                                                
MS.  BARRANS replied  no because  the current  contract addresses                                                               
the situation in which the  legislature doesn't sufficiently fund                                                               
the  contract.   In such  a situation,  the [number  of students]                                                               
would be relevant  to the funding level.  However,  it does place                                                               
the University  of Washington  School of  Medicine in  an awkward                                                               
position because  it will have  a certain number of  students and                                                               
annual funding.                                                                                                                 
3:57:45 PM                                                                                                                    
The committee took an at-ease from 3:57 p.m. to 4:00 p.m..                                                                      
4:00:30 PM                                                                                                                    
MS. BARRANS said that as a  fiscal agent for the state, she would                                                               
ensure  that   there  is  a   provision  in  the   contract  that                                                               
contemplates a day  in which the legislature wouldn't  be able to                                                               
fund  the  program.    Therefore,   everyone  entering  into  the                                                               
contract would understand  what would occur in  such a situation.                                                               
Ms. Barrans clarified that this is  an obligation of the State of                                                               
Alaska not the Alaska Student Loan Corporation.                                                                                 
4:01:07 PM                                                                                                                    
MS. BARRANS,  in response to  Representative Seaton,  stated that                                                               
the PFD  residency requirements wouldn't  suffice.  The  ACPE has                                                               
specifically defined  a resident for the  purposes of eligibility                                                               
for this  program as  someone who has  physically resided  in the                                                               
state  for two  years prior  to admittance  into the  program, or                                                               
that the  absence from the state  be solely due to  the full-time                                                               
educational pursuit of the individual  or his/her spouse and that                                                               
the  two   years  preceding  the  absence,   the  individual  was                                                               
physically present in the state.                                                                                                
4:02:21 PM                                                                                                                    
REPRESENTATIVE GARDNER inquired as  to the repayment requirements                                                               
for a graduate who doesn't return to the state to practice.                                                                     
MS.  BARRANS  explained  that  the  only change  would  be  in  a                                                               
situation  in  which  an  individual  who  attended  a  residency                                                               
program  outside of  Alaska  and served  some  period of  service                                                               
obligation to  another entity; that individual  would potentially                                                               
have a number  of years of interest-free status  on the principal                                                               
of the loan.   Ms. Barrans characterized  whether the legislature                                                               
would  want  to have  the  interest  added  to  the debt  of  the                                                               
individual in  the aforementioned  situation and require  such an                                                               
individual  to repay  the  entire debt  as a  policy  call.   The                                                               
current interest  on such a  loan amounts  to 8.25 percent.   Ms.                                                               
Barrans noted  that currently  the debt  is interest  free during                                                               
the  four years  of the  program and  the repayment  is over  the                                                               
course of 15 years.                                                                                                             
4:04:36 PM                                                                                                                    
REPRESENTATIVE GARDNER referred to page  2, line 5, which relates                                                               
that a  student of the program  who doesn't return to  Alaska and                                                               
isn't in  any of the  other exclusionary programs is  required to                                                               
repay 50 percent of what the state has paid.                                                                                    
MS. BARRANS replied yes.                                                                                                        
4:05:13 PM                                                                                                                    
REPRESENTATIVE  GARDNER inquired  as  to why  the state  wouldn't                                                               
require a student in such a situation to repay the full amount.                                                                 
MS.  BARRANS  relayed that  the  discussion  around the  original                                                               
legislation  were  that students  wouldn't  take  advantage of  a                                                               
program with  a punitive debt  if an individual didn't  return to                                                               
Alaska.  While someone entering  the program may intend to return                                                               
to  Alaska, there  may be  another  outcome due  to various  life                                                               
changes, she noted.                                                                                                             
MS. TRYCK  explained that because  the money is located  in ACPE,                                                               
it's  viewed  as a  subsidy  of  students of  medical  education.                                                               
However, it's structurally  the same as the public  funds for the                                                               
University  of Alaska.    One  way to  view  whether the  student                                                               
should repay 100 percent is  to question whether every student in                                                               
the University  of Alaska pays the  full cost of education.   Ms.                                                               
Tryck  pointed  out that  when  students  attend private  medical                                                               
schools, they  do pay a  high tuition  rate.  Still,  students in                                                               
private  medical schools  don't  pay 100  percent  of the  actual                                                               
4:07:51 PM                                                                                                                    
MS.  BARRANS referred  to the  language on  page 2,  lines 18-22,                                                               
which she  characterized as  "a grey area"  that is  difficult to                                                               
program  into a  system  code.   She  related  that deleting  the                                                               
language would be preferable.                                                                                                   
4:09:58 PM                                                                                                                    
REPRESENTATIVE SEATON  asked if  the [language  on page  2, lines                                                               
18-22]  addresses  a  situation  in  which  an  individual  is  a                                                               
perpetual student and isn't making progress toward graduation.                                                                  
MS. BARRANS said that in the over  20 years she has been with the                                                               
program, that hasn't happened.   In situations in which a student                                                               
has to sit  out one year, the status of  the account is suspended                                                               
until a resolution occurs.                                                                                                      
MS.  TRYCK noted  that WWAMI  does have  a means  for terminating                                                               
students.  However,  there are Alaskans who go into  a fifth year                                                               
and  the  program  provides  allowances for  that.    In  further                                                               
response   to  Representative   Seaton,  Ms.   Tryck  said   that                                                               
elimination  of  the  provision wouldn't  encourage  students  to                                                               
become derelict with their education.                                                                                           
4:12:16 PM                                                                                                                    
TIM  KELLY, Lobbyist  for the  Alaska  State Medical  Association                                                               
(ASMA), relayed  that HB  18 is  important legislation,  which he                                                               
characterized as  a top  priority this  legislative session.   He                                                               
further relayed that ASMA is supportive of Version M.                                                                           
4:13:34 PM                                                                                                                    
CHAIR WILSON,  upon determining  no one  else wished  to testify,                                                               
closed public testimony.                                                                                                        
4:13:58 PM                                                                                                                    
REPRESENTATIVE GARDNER  moved that the committee  adopt Amendment                                                               
1, as follows:                                                                                                                  
     Page 2, lines 18-22;                                                                                                       
          Delete "If the commission finds that the program                                                                  
     participant has  withdrawn from the  medical education,                                                                
     residency, or  fellowship program, or that  the program                                                                
     participant  is  otherwise  failing  to  make  adequate                                                                
     progress   toward  completion   of  the   program,  the                                                                
     commission  may start  the  accrual  of interest  after                                                                
     notifying the program participant."                                                                                    
There being no objection, Amendment 1 was adopted.                                                                              
4:14:47 PM                                                                                                                    
REPRESENTATIVE  SEATON  moved  to  report CSHB  18,  Version  25-                                                               
LS0131\M, Mischel,  1/30/07, [as  amended] out of  committee with                                                               
individual  recommendations and  the  accompanying fiscal  notes.                                                               
There  being no  objection, CSHB  18(HES) was  reported from  the                                                               
House Health, Education and Social Services Standing Committee.                                                                 

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