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 first hearing for this bill in the Senate Finance Committee. AT EASE 9:15:18 AM / 9:15:38 AM 9:15:52 AM MIKE PAWLOWSKI, Staff to Representative Kevin Meyer, the bill's sponsor, characterized the State's continuing physician shortage to be "at the edge of crisis". The situation has been a subject of discussion for many years. The Alaska Physician Supply Task Force has recommended that the State "should seriously look at both recruiting more physicians and growing our own." Mr. Pawlowski explained that this bill would further the effort to solve the State's physician shortage by doubling the size of the State's participation in the post secondary Washington, Wyoming, Alaska, Montana, and Idaho Biomedical Program (WWAMI). 9:17:05 AM Mr. Pawlowski specified that each state's financial participation in WWAMI, a program in which students from the five aforementioned states are educated at the University of Washington School of Medicine, is based upon the number of students they have enrolled in the program. Historically, Alaska has admitted ten new participants to the program annually. Mr. Pawlowski announced that approximately one-third of the physicians in Alaska could be retiring within the next ten years. To that point, this legislation would increase the number of new participants in the WWAMI program each year to 20. Mr. Pawlowski detailed the particulars of the WWAMI program. After being accepted to the University of Washington (UW) School of Medicine, program participants attend the University of Alaska Anchorage their first year and then transfer to UW. After completing their UW training, they enter residency and work toward becoming a full-fledged physician. Mr. Pawlowski stated that, in addition to increasing the number of students participating in the program, this bill would allow participants to conduct their residency outside of Alaska. This is because the only residency program in Alaska "is limited to general family practice doctors" and the State is in need of other types of physicians. Allowing students "to conduct their residency out of state" would be beneficial to the program. Mr. Pawlowski noted that the Senate Special Committee on Education bill before the Committee changed language pertaining to how interest accrues on a WWAMI student loan during the participant's out-of-state residency period: it would not require that "repayment" until the participant returned to the State "to fulfill their obligation or leave their residency program or assorted service." Mr. Pawlowski deemed the actions proposed in this bill to be "the first step in bridging our physician shortage; it is a long time lead step" of perhaps seven to ten years. That timeframe would be approximately when the State would require new physicians to replace retiring ones. The effort to increase the number of physicians is welcome as it would improve access to care and perhaps assist in lowering the cost of medial care in the State. 9:19:15 AM In response to a request from Co-Chair Stedman, Mr. Pawlowski explained that Alaska, Wyoming, Idaho, and Montana participate in the WWAMI program in partnership with the UW School of Medicine because no medical school is available within their state. UW essentially becomes the participating state's medical school. Co-Chair Hoffman recalled a recent discussion between Senator Olson and Alaska's Congressional Senator Lisa Murkowski regarding the challenge of attracting more physicians to the State. To that point, Co-Chair Hoffman assessed the need to increase the number of general practitioners to be greater than the need to attract medical specialists, particularly in Rural Alaska. Therefore, he suggested that consideration be given to requiring graduates of the WWAMI program to provide general practice service to the State. Co-Chair Hoffman also asked the program's success rate in respect to the number of graduates who return and practice in Alaska. Mr. Pawlowski stated that Alaska Statute B, which is not addressed in this bill, specifies that a WWAMI student loan should be repaid over a five year period. Statute B also specifies that a student conducting their family practice residency in the State would receive "credit towards my 100 percent payback for the three years that I'm in residency". This provides an "implicit benefit to the student going into the WWAMI program to come back" and practice general family medicine in the State. Mr. Pawlowski stressed how challenging it is, when a student enters the program, to determine where they would conduct their residency or what specialty they would pursue. Nonetheless, the consensus is that the State is in need of both general practitioners and specialists. Mr. Pawlowski emphasized, however, that the number of students who return and practice in the State exceeds 80 percent. The bill's sponsor, Representative Meyer, believes this is indicative of a successful program. 9:22:52 AM Co-Chair Hoffman asked the timeframe pertaining to the 80 percent student return rate. Mr. Pawlowski understood it was based on records for the past five to seven years. This information should be verified by either the UW or the WWAMI program coordinators. Co-Chair Hoffman asked how many of those physicians have practiced in the State more than ten years. Mr. Pawlowski suggested that representatives of the UW and the WWAMI program who were listening to the discussion via teleconference could better address the question. He cautioned however that such information might have been difficult to track prior to the year 2000 when repayment provisions were added to the program. 9:24:20 AM Co-Chair Hoffman opined that both the success rate of the program and the long term retention rate of its graduates should be determined since consideration is being given to doubling the number of students admitted and, thus, the State's financial commitment, to the program. 9:24:38 AM Senator Elton advised of a concern communicated to him that a [unspecified] provision in the bill might "discourage a general practice or a family practice because" it might "compel people into a specialty that, in fact, paid more to deal with the loan cost". 9:25:15 AM Mr. Pawlowski had "heard the same characterization", but was unsure of its fairness. Even though students in the program could accumulate "a debt burden of $150,000 to $200,000", conducting their residency in the State would reduce that burden, and thus allow a student to go into general family practice. This debt forgiveness factor could create "an adequate hook to ensure" that a student would come back to the State. He acknowledged however that the issue could be argued two ways and therefore would be a policy call. 9:26:18 AM Senator Elton suggested that the University of Alaska be provided an opportunity to weigh in on whether this might be "a potential problem" before the Committee took action on the bill. Co-Chair Stedman communicated that the University would be provided an opportunity to comment, as he intended to hold the bill in Committee. 9:26:40 AM Senator Olson advised of having information that might address Co-Chair Hoffman's earlier concern about medical care in Rural Alaska. Co-Chair Stedman asked that the information referenced by Senator Olson be distributed to Members after today's hearing. That would allow Members time to review it before the next hearing on the bill. Senator Olson agreed. 9:27:43 AM ROD BETIT, President and Chief Executive Officer, Alaska State Hospital and Nursing Home Association, spoke on behalf of the organization's 37 members which included "all of the military, State, tribal, and private facilities in the State with the exception of one". This legislation is the "number one priority" of the Association. Members' packets include a January 16, 2007 letter [copy on file] to Representative Kevin Meyer from the Association to that effect. Mr. Betit spoke to the effort Association members exert to attract physicians to meet the needs of the State. Also, being a member of the aforementioned Task Force, he shared their conclusion that the State must experience an annual net gain of 59 physicians rather than the current net gain of 38 in order to adequately address the State's physician shortage, which currently exceeds 300. The Task Force considered this legislation "a very significant step" toward addressing the problem. Mr. Betit advised that annually, approximately half of the students who participated in the WWAMI program return to the State to practice. Another three or four students from the partnering states who were exposed to Alaska as part of their clinical training also chose to practice in the State. "That's a pretty healthy return rate." Mr. Betit considered this legislation to be "one of the most cost beneficial things that the State could do to help close that gap" in the State's physician shortage. Mr. Betit urged prompt action on the bill as the goal is to expand the State's WWAMI class size this year. 9:30:47 AM Co-Chair Hoffman revisited his earlier concern about the number of program graduates who return to the State; specifically that he could not recall any WWAMI graduate having practiced in the Yukon-Kuskokwim region of the State. He also inquired about the tenure of those who did practice in the State. Mr. Betit expressed that this information was available and would be provided. He agreed that the Yukon-Kuskokwim area "is particularly stressed as far as having enough physicians to meet the needs of the people" there. The experience at any given time last year was that approximately 21 more physicians were needed to cover the clinics and serve the area's residents. The Yukon- Kuskokwim medical facility had only 11 or 12 staff physicians; the balance consisted of traveling physicians who would stay approximately two or two weeks. This is detrimental to continuity of patient care. Mr. Betit informed the Committee that rural representation in the WWAMI program was strong. Candidates were well prepared and had the ability to compete well for placement in the program. 9:32:28 AM Co-Chair Hoffman asked whether the proposal to increase the State's participation in the WWAMI program had been discussed with the UW to verify the increase could be accommodated. Mr. Betit assured that UW had committed to accommodating ten additional program participants from Alaska. UW had also requested that the State make a decision in this regard by early March as the selection process for the next medical school class was underway. 9:33:24 AM Senator Olson asked Mr. Betit how the decision to increase program participants to 20 rather than 25 or 30 had been reached, considering the high demand for physicians in the State. 9:34:04 AM Mr. Betit responded that the Task Force recognized that the physician shortage could not be rectified in short order. Thus, the Task Force's goal was "to get our physician capacity to where it needed to be by the year 2025." A net gain of 21 additional physicians per year would be required to achieve that goal. The shortage in the short term would continue since the impact of the first graduates of the 20-student Alaska WWAMI class would not be felt for approximately seven years. Regardless, this legislation was considered "good strategy". Mr. Betit opined that, until then, it would be "unrealistic to think that" the State would attract 30 or 40 new physicians annually, as the competition, nationally, is high. A goal of 20 is considered realistic. 9:35:09 AM Co-Chair Hoffman asked whether housing and medical facility conditions were considered in the effort to recruit physicians, as improved housing and school facility conditions enhanced the effort to address teacher shortages in rural areas of the State. Mr. Pawlowski affirmed that "the physician practice environment" had been reviewed in the effort to make practicing in Alaska attractive, particularly in the more remote areas of the State. While further attention should be devoted to the physician practice environment, enlarging the WWAMI program and educating and encouraging Alaskan students to practice in the State made "more sense" than concentrating on recruiting physicians from outside the State. 9:36:42 AM Senator Dyson communicated that "physician friends …. who have practiced in Rural communities say there are some professional trade-offs". For example, doing so provided them the opportunity to practice a wider range of medical procedures than they might have experienced in an urban community setting. He asked Mr. Betit to expand on the different "professional development" opportunities one might experience in a small verses large medical environment; specifically whether such opportunities might attract physicians. 9:37:37 AM Mr. Betit responded that some physicians like the challenges a small rural clinic might present while others do not. It is importance to prevent physicians in more remote areas from feeling "isolated" and without any professional support. To that point, he applauded previous Legislative action which provided one million dollars toward a tele-radiology system for hospitals and clinics in rural communities. The response to this system has been very positive, and it has enhanced patient care by allowing medical personnel to send film to and teleconference with larger medical resources. Mr. Betit stated that further efforts should be made to ensure that the practice environment in remote areas makes a physician feel comfortable. 9:38:53 AM Senator Dyson acknowledged, but clarified that his question was to the benefits physicians might experience by being in rural environments. 9:39:28 AM Mr. Betit expressed that the lifestyle, size and feel of a community, and having to cope with a lack of managed care might be "on the positive side" of working in a rural area. 9:39:59 AM Senator Thomas asked whether Alaska's physician recruitment experiences differed from those experienced by other rural states. 9:40:24 AM Mr. Betit replied that Alaska's experiences were not unusual; the physician shortage is widespread and many small states are required to vigorously recruit. Nonetheless, living in Alaska has "additional challenges". In addition, "managing a patient population in this size state isn't as efficient as it would be in bigger settings." Mr. Betit disclosed that Wyoming is expanding its number of WWAMI program participants in order to increase its opportunity to hire in-state students. Alaska must be aggressive in keeping up with the efforts of other WWAMI states. 9:41:15 AM Senator Thomas inquired to other measures the State might undertake to address the physician shortage beyond increasing the number of WWAMI participants. Mr. Betit stated that the Task Force's report "Securing an Adequate Number of Physicians for Alaska's Needs "[copy on file] includes several recommendations regarding how to improve the practice environment. Mr. Betit credited previous Legislative action that improved the State's tort reform provisions for "a significant drop in the liability" facing physicians. That has been "a big factor in terms of being able to attract the physicians that are coming to the State". Mr. Betit noted that other Task Force recommendations address such things as the loan repayment program, the physician recruitment process, and other practice environment issues. While no formal strategies have yet been developed, his organization and others have committed to assisting in the endeavor. 9:42:42 AM Senator Olson understood that a recent trend in health care treatment has been toward utilizing mid-level health care professionals such as physician assistants and nurse practitioners, particularly in treating Medicare and Medicaid patients. He had not noticed much emphasis placed on this in the Task Force report. Mr. Betit clarified that the focus of the report was to physician needs in the State. However, the Task Force had discussed mid-level providers and included a notation in the report that Alaska had "a higher proportion" of mid level care givers than most states. "The relationship between mid-levels and physicians in Alaska is much stronger than it is in most states…." The desire would be for that relationship to continue and that more mid-level providers be available to fill some of the gaps in the State's health care system. 9:44:14 AM Senator Huggins questioned whether the language in Section 1 subsection (d), page 1 line 9, that specified that the program would "accommodate at least 20 new program participants each year" meant that the program could be expanded beyond 20 were there a large field of qualified candidates. Mr. Betit understood the verbiage to allow for more than 20 program participants provided additional funding was authorized. The goal this year was to receive funding authorization for an additional ten program participants. This would, in effect, increase the program size to 20. 9:45:01 AM Co-Chair Hoffman, referring to language in Section 2 subsection (a), page 2 lines 3 and 4 of the bill which outlined student obligations, asked whether it "would be wise to" require program participants returning to the State to practice "in some of the most deprived areas of the State". 9:45:36 AM Mr. Betit expressed being unqualified to speak to that issue. However, he noted that academics have voiced concern "about imposing" such a condition. 9:45:54 AM Co-Chair Hoffman was concerned that even though program participants return to the State to practice, "the services aren't getting out to the areas that are most underserved…." 9:46:31 AM LEO BUSTAD, Cardiologist with the Alaska Heart Institute in Anchorage testified in Juneau on behalf of Alaska physicians and surgeons. His background included being a member of the University of Alaska's chancellor advisory board and previous service as a clinical professor at the University of North Carolina. Dr. Bustad spoke about the opportunities the State's WWAMI program has provided to program participants for 20 years. However, even thought the State's population and medical needs have risen, the number of participants in the program has not been increased. Approximately 40 "well-qualified" Alaskan students are denied admittance to the program's ten slots each year despite the increased need. Dr. Bustad informed the Committee that his medical practice has had to contract with a recruitment search company for many years in spite of the fact that cardiology is an attractive field. It would be easier to recruit from an Alaskan pool of applicants as they are familiar with the State and typically have family nearby rather than 3,000 miles away as could be the experience when hiring people from outside the State. Dr. Bustad elaborated that the WWAMI program provides Alaska students an opportunity to attend medical school. It is a successful program, and rather than solely focusing on the costs associated with increasing the program, the cost of not increasing program funding should be considered. The physician shortage in Anchorage is the price being paid now. Dr. Bustad acknowledged the physician shortage in Rural Alaska and noted that many students in the WWAMI program "have come from western Alaska". It is much easier to recruit those people "to come back and practice in western Alaska than it would be to recruit someone from New York City." The State has "an obligation to our young people to give them an opportunity to go to medical school". The program "is one of the few workforce development programs that has been very successful. The dropout rate is near zero." Dr. Bustad asserted that a large group of qualified students who desire to become doctors are denied admittance to the program each year "despite at the end of the pipeline there's a large number of jobs that go unfulfilled. The university is the bottleneck." Dr. Bustad concluded that the cost of the program would be more attractive were it viewed in terms of the number of "students completing the program as opposed to the cost of the students" going into it. Co-Chair Hoffman believed in the program, but contended that there were other opportunities through which students could receive a medical education. Dr. Bustad stated that, were the State-supported WWAMI program eliminated, students would be forced to attend private medical schools. They would, most likely, incur huge debt and thereby, might not be prone to return to Alaska. In addition, the opportunity to attend a private medical school is limited. 9:51:52 AM Senator Elton asked the types of medical residency programs available in the State. Dr. Bustad advised that the family practice residency at Providence Hospital in Anchorage had the capacity to train 12 physicians a year. That program, which "is the only self- contained residency program in the State" is successful in terms of retaining physicians in the State. Other residency physicians "rotate through Alaska hospitals in certain situations." For example, the Navy hospital provides some surgeon and perhaps some internal medicine opportunities. There are no residency programs for cardiologists. Third and fourth year UW medical students also have the opportunity to rotate through Alaska. Such exposure might encourage students from other states to consider practicing here. 9:53:10 AM Senator Elton declared that residency programs should be encouraged as there is a connection between residency and physicians deciding to stay and practice in the State. Dr. Bustad specified that simply adding ten students a year to the WWAMI program should not be lauded as the complete solution. Alaska's current physician force is aging and while enlarging the WWAMI class this year is encouraged, graduates of the program might not be available to replace retiring physicians, including his fellow cardiologists, until perhaps the year 2017. Dr. Bustad reiterated that "the cost of doing nothing is very high". Senator Olson observed that allowing Alaskan students to be educated closer to home and to their support group was a benefit to them and the State. Senator Olson also opined that, in addition to the need for general family practitioners, there would be increasing demand for cardiologists and other specialists as the State's population aged. He asked Dr. Bustad's perspective on this. 9:56:22 AM Dr. Bustad remarked that the number of specialists in the State is not keeping pace with demand even now. He experienced difficulty finding specialized treatment for some of his patients, even in Anchorage. Providence Hospital, which is the largest medical complex in the State, has only two internists. The internist who would accept Medicaid patients was a WWAMI student. Dr. Bustad ranked the lack of primary care physicians as the State's largest medical "deficit, however, there was also an inadequate number of specialists. The State must do "something dramatically different" or the situation would continue to deteriorate. 9:57:39 AM Senator Huggins asked the effect of tort reform on physicians. 9:58:01 AM Dr. Bustad expressed that the State of Washington's current tort reform measures resemble those of Alaska's before Alaska changed theirs. Spokane Washington has experienced a net loss of physicians: they moved out of state due to the state's tort reform. Dr. Bustad opined that Alaska's physician recruitment problems were not attributable to its tort reform provisions but resulted from the State's distance from other places. Medical professionals and their families hesitate to come here because they would be far from family. 9:58:50 AM Senator Olson asked whether the medical climate in the State might shift toward managed care organizations, commonly referred to as Health Management Organizations (HMOs). Dr. Bustad did not think that shift would occur because of the State's remoteness, its limited opportunities, and its small population base. 9:59:51 AM After consulting with Co-Chair Stedman, Mr. Pawlowski agreed to work with Finance staff to develop a list of Committee questions to be addressed by WWAMI program managers in Alaska and at UW. The responses would be provided in writing. Co-Chair Stedman ordered the bill HELD in Committee. AT EASE 10:01:07 AM / 10:01:42 AM