Legislature(2007 - 2008)SENATE FINANCE 532
03/13/2007 09:00 AM FINANCE
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* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
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 Committee. 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 bill. 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 budgets. 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 program. 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 states. 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 process. 10:15:53 AM Co-Chair Stedman ordered the bill HELD in Committee.