Legislature(2007 - 2008)SENATE FINANCE 532

03/13/2007 09:00 AM FINANCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Moved CSSB 59(FIN) Out of Committee
+ Bills Previously Heard/Scheduled TELECONFERENCED
Moved SB 81 Out of Committee
Heard & Held
9:56:38 AM                                                                                                                    
     SENATE CS FOR CS FOR HOUSE BILL NO. 18(SED)                                                                                
     "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."                                                                                
This was the  second hearing for this bill in  the Senate Finance                                                               
9:57:02 AM                                                                                                                    
Co-Chair  Stedman  announced  that  the  Committee  would  review                                                               
additional  information  but  would  not report  this  bill  from                                                               
Committee at this time. Fiscal issues must be addressed.                                                                        
9:57:26 AM                                                                                                                    
MIKE PAWLOWSKI, Staff to Representative  Kevin Meyers, sponsor of                                                               
the bill, testified to a  memorandum dated February 26, 2007 from                                                               
Representative  Meyer to  Co-Chair  Stedman [copy  on file].  Mr.                                                               
Pawlowski  noted this  memorandum addressed  questions raised  at                                                               
the previous  hearing and highlighted  the responses  to Co-Chair                                                               
Hoffman's questions as follows.                                                                                                 
     1.  What  is  the   long-term  effectiveness  of  the  WWAMI                                                               
     program?  How  many   WWAMI  [Washington,  Wyoming,  Alaska,                                                               
     Montana  and Idaho]  graduates are  still practicing  in the                                                               
     State of Alaska?                                                                                                           
          a. The first WWAMI class graduated in 1975. 60% of all                                                                
          WWAMI graduates are still practicing in Alaska today.                                                                 
     2. How  many WWAMI  graduates practice  in Bethel?  How many                                                               
     WWAMI graduates practice in rural Alaska?                                                                                  
          a. While WWAMI graduates have previously practiced in                                                                 
          Bethel and Western Alaska, there are none currently                                                                   
          practicing in  the region. Students have  however, been                                                               
          accepted from  the area and students  from rural Alaska                                                               
          represent a  significant portion of the  incoming WWAMI                                                               
          classes. Out  of the 60% of  WWAMI graduates practicing                                                               
          in Alaska, almost 1 in  4 are currently practicing in a                                                               
          rural community, compared to only  1 in 10 in the other                                                               
          WWAMI states.                                                                                                         
9:59:18 AM                                                                                                                    
Mr. Pawlowski continued overviewing the memorandum and the                                                                      
question posed by Senator Elton as follows.                                                                                     
     3.  Address   whether  the   Senate  Special   Committee  on                                                               
     Education's amendment functions to  increase or decrease the                                                               
     chances  a   participant  will   go  in   to  general/family                                                               
     practice.  Did  the  amendment  increase  the  participant's                                                               
     costs in  light of the fact  that family practice is  one of                                                               
     the lowest paid specialties in medicine?                                                                                   
          a.  The answer  to the  first part  of the  question is                                                               
          difficult   since  it   requires   speculation  on   an                                                               
          individual's educational and  professional choices. The                                                               
          amendment clearly  increases the debt burden  a student                                                               
          takes  on  during  their   studies  and  through  their                                                               
          residency.  For example,  if a  student borrowed  their                                                               
          portion  of tuition,  the  obligation  they would  have                                                               
          accrued  after 3,  5, or  7 years  of residency  at the                                                               
          current interest rate of 7.5% would be:                                                                               
               3 years: $93,172                                                                                                 
               5 years: 107,672                                                                                                 
               7 years: 124,429                                                                                                 
          When viewed  in combination with the  student's tuition                                                               
          payments of $15,500 per year,  a WWAMI student is faced                                                               
          with the  prospect of coming  out of residency  with as                                                               
          much  as   $200,000  in  outstanding   obligations,  in                                                               
          addition   to  whatever   they  accrued   during  their                                                               
          undergraduate  career. If  interest didn't  accrue, the                                                               
          student's  WWAMI obligation  would be  $75,000. Whether                                                               
          this  difference   pushes  an  individual   toward  one                                                               
          particular specialty  or another  is difficult  to say.                                                               
          However, in  accruing a higher obligation  a person has                                                               
          substantially  increased their  incentive to  return to                                                               
          Alaska to practice.                                                                                                   
10:00:23 AM                                                                                                                   
Co-Chair  Stedman noted  information regarding  the Alaska  WWAMI                                                               
Biomedical Program  website was submitted by  Senator Olson [copy                                                               
on file].                                                                                                                       
10:00:53 AM                                                                                                                   
MICHELLE    RISK,   University    of   Alaska,    testified   via                                                               
teleconference from an offnet location  that she was available to                                                               
respond to questions on the fiscal note.                                                                                        
10:01:13 AM                                                                                                                   
MIKE HOGAN,  Executive Director, Alaska Physicians  and Surgeons,                                                               
Inc.,  testified  from  an  offnet  location  that  he  was  also                                                               
available  to respond  to  questions. He  voiced  support of  the                                                               
10:01:31 AM                                                                                                                   
Co-Chair  Stedman learned  that Pete  Kelly, Director,  Office of                                                               
Government Relations,  University of  Alaska, and  Diane Barrans,                                                               
Executive    Director,   Postsecondary    Education   Commission,                                                               
Department of Education and Early  Development, were available to                                                               
respond to questions.                                                                                                           
10:02:05 AM                                                                                                                   
Co-Chair Stedman  spoke to the cost  of the program to  the State                                                               
and the  "potential impact in years  to come". He asked  Ms. Risk                                                               
to address the cost implications.                                                                                               
10:02:27 AM                                                                                                                   
Ms.  Risk asked  whether  the Committee  had  received a  revised                                                               
fiscal note from the University of Alaska.                                                                                      
10:02:45 AM                                                                                                                   
Co-Chair  Stedman established  that the  Committee did  have this                                                               
fiscal note  in its  possession along with  the two  fiscal notes                                                               
adopted by previous committees.                                                                                                 
10:03:26 AM                                                                                                                   
Co-Chair  Stedman  commented  on  the "shear  magnitude"  of  the                                                               
revised  fiscal note  and  inquired whether  the  costs could  be                                                               
"absorbed" in the University of  Alaska's and the WWAMI program's                                                               
10:03:38 AM                                                                                                                   
Ms.  Risk  pointed  out  that  the  University  would  contribute                                                               
$180,000 University Receipt funds in FY 08.                                                                                     
10:04:04 AM                                                                                                                   
Senator   Elton  directed   attention  to   the  $30,000   travel                                                               
expenditure listed  on the revised  fiscal note and asked  for an                                                               
explanation  of  the travel  involved  in  the operation  of  the                                                               
10:04:18 AM                                                                                                                   
Ms. Risk  replied that the  revised fiscal note  contains funding                                                               
for  two new  faculty positions  and support  staff positions  to                                                               
accommodate the increase of the  program from ten to 20 students.                                                               
The  funding  specified  in  the  travel  component  would  cover                                                               
expenses  incurred  by all  of  the  program's positions.  Travel                                                               
would be to the other states participating in the program.                                                                      
10:04:54 AM                                                                                                                   
Senator  Elton asked  the  purpose  of the  travel  to the  other                                                               
10:05:08 AM                                                                                                                   
Ms. Risk answered  that the travel is necessary  to allow faculty                                                               
to "learn about the program."                                                                                                   
10:05:24 AM                                                                                                                   
DENNIS   VALENZENO,  PhD,   Director,  Alaska   WWAMI  Biomedical                                                               
Program,   University   of    Alaska-Anchorage,   testified   via                                                               
teleconference from an offnet location,  about the two additional                                                               
faculty positions.  WWAMI is a  collaboration of  several states.                                                               
Participating faculty congregate to discuss the program.                                                                        
10:06:15 AM                                                                                                                   
Senator Elton noted that at least one annual trip occurs.                                                                       
10:06:22 AM                                                                                                                   
Dr. Valenzeno  affirmed that one  trip occurs  at the end  of the                                                               
school year.  Additionally, other travel is  necessary to address                                                               
changes to the program.                                                                                                         
10:06:40 AM                                                                                                                   
Co-Chair  Stedman  requested  an  explanation of  the  change  in                                                               
number of positions.                                                                                                            
10:06:50 AM                                                                                                                   
Ms.  Risk informed  that two  new  full time  positions would  be                                                               
created  and  that two  existing  part  time positions  would  be                                                               
expanded to full time positions.                                                                                                
10:07:22 AM                                                                                                                   
Co-Chair Stedman asked the cost breakdown of the positions.                                                                     
10:07:25 AM                                                                                                                   
Ms.  Risk answered  that $40,000  would be  utilized to  fund the                                                               
expansion  of  the part  time  positions.  The remainder  of  the                                                               
$250,000 Personal  Services component  would be utilized  for the                                                               
salary and benefits of the two new full time positions.                                                                         
10:07:42 AM                                                                                                                   
Co-Chair Stedman  asked if the  professors participating  in this                                                               
program teach only to WWAMI students.                                                                                           
10:07:50 AM                                                                                                                   
Dr. Valenzeno replied that the  faculty instructs WWAMI students,                                                               
as well  as undergraduate and graduate  students, particularly in                                                               
the biology and chemistry courses.                                                                                              
10:08:22 AM                                                                                                                   
Senator Olson  asked if  the two new  faculty positions  would be                                                               
clinical or professors.                                                                                                         
10:08:36 AM                                                                                                                   
Dr. Valenzeno  answered that  one position  would be  a "fulltime                                                               
basic scientist" and  the other position would  be categorized as                                                               
one-half basic scientist and one-half clinical scientist.                                                                       
10:08:56 AM                                                                                                                   
Senator  Olson informed  that some  travel  expenses include  the                                                               
costs of  students traveling to  rural sites. He  has experienced                                                               
WWAMI students traveling in Nome and Barrow.                                                                                    
10:09:07 AM                                                                                                                   
Senator  Thomas asked  the number  of students  currently on  the                                                               
waitlist  to enter  the WWAMI  program  and the  duration of  the                                                               
waitlist. He commented on the need  to pass this legislation in a                                                               
timely manner  to allow  those students who  would be  allowed to                                                               
participate in  the expanded program  to apply for  acceptance in                                                               
medical school in Washington.                                                                                                   
10:09:41 AM                                                                                                                   
SUZANNE  TRYCK  testified  via   teleconference  from  an  offnet                                                               
location  identifying   herself  as   "from  the   University  of                                                               
Washington  side  of the  Alaska  WWAMI  Program". Currently  ten                                                               
additional students  are on the  waitlist and have  "already been                                                               
determined  to be  accepted  into the  program."  The letters  of                                                               
invitation for "the first ten"  had been mailed. The ten students                                                               
on the  waitlist, "will,  we fear, go  away with  each succeeding                                                               
day; they probably have letters  of invitation from other medical                                                               
schools." Therefore the timing "is an issue for us."                                                                            
10:10:38 AM                                                                                                                   
Senator Elton  requested that  because of  the timing  issue, the                                                               
Committee consider reporting  this bill to the  next committee of                                                               
referral  with the  expectation that  the fiscal  notes could  be                                                               
addressed  "within the  next  couple of  days"  and finalized  by                                                               
another committee.                                                                                                              
10:11:34 AM                                                                                                                   
Co-Chair  Stedman   acknowledged  the  testimony   regarding  the                                                               
urgency of this  legislation. He also noted the  Committee was in                                                               
the process of addressing the  University of Alaska budget, which                                                               
correlates to the funding of the Alaska WWAMI program.                                                                          
10:12:06 AM                                                                                                                   
Co-Chair  Hoffman expressed  concerns  about  the revised  fiscal                                                               
note. The  WWAMI program could  be beneficial in  alleviating the                                                               
shortage  of doctors  practicing in  Alaska. However,  the health                                                               
care profession  needs in rural  areas "far outweighs"  the needs                                                               
in urban  areas. He expressed  interest in including  a provision                                                               
in  this bill  that would  "give  direction" and  result in  some                                                               
additional  physicians practicing  in rural  areas. As  currently                                                               
written,  this  legislation  could   facilitate  an  increase  in                                                               
doctors  practicing   in  Alaska  but  no   increase  in  doctors                                                               
practicing in Rural Alaska.                                                                                                     
10:13:30 AM                                                                                                                   
Senator  Olson  deemed  the issue  of  less  concern.  Physicians                                                               
practicing  in rural  locations  would have  incentive to  accept                                                               
offers of employment in urban  centers. However, if urban centers                                                               
were adequately  represented, fewer  offers would be  extended to                                                               
physicians in  rural areas and  thus those physicians  would more                                                               
likely remain in their current practice.                                                                                        
10:14:51 AM                                                                                                                   
Senator Olson offered a partial  solution to the fiscal concerns.                                                               
Rather  than  expanding  the  program  to  admit  ten  additional                                                               
students,  a  compromise  could   be  made  and  five  additional                                                               
students could be allowed to participate.                                                                                       
10:15:29 AM                                                                                                                   
Co-Chair  Stedman indicated  he  would  collaborate with  Senator                                                               
Olson  to  develop  the  proposal.  The  fiscal  impact  of  this                                                               
legislation  would  be  addressed   through  the  regular  budget                                                               
10:15:53 AM                                                                                                                   
Co-Chair Stedman ordered the bill HELD in Committee.                                                                            

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