Legislature(2009 - 2010)CAPITOL 106
01/22/2010 08:00 AM House EDUCATION
| Audio | Topic |
|---|---|
| Start | |
| Overview: Anchorage School District Memorandum 96: Comprehensive Study of the Predictors of High School Outcomes | |
| HB235 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| *+ | HB 235 | TELECONFERENCED | |
HB 235-PROF STUDENT EXCHANGE LOAN FORGIVENESS
9:23:12 AM
CHAIR SEATON announced that the next order of business would be
HOUSE BILL NO. 235, "An Act relating to professional student
exchange program availability and conditions for loan
forgiveness."
The committee took an at-ease from 9:24 to 9:25.
9:25:35 AM
REPRESENTATIVE P. WILSON moved to adopt CSHB 235, Version 26-
LS0913|R, Mischel, 1/8/10, as the working document.
CHAIR SEATON objected for discussion.
9:25:56 AM
REPRESENTATIVE MUNOZ began the introduction of HB 235.
[Technical difficulties interrupted her presentation but did not
result in loss of testimony.]
9:27:18 AM
DIANE BARRANS, Executive Director, Postsecondary Education
Commission, stated that she was available for questions and
comments.
9:27:27 AM
REPRESENTATIVE MUNOZ continued, paraphrasing from a prepared
statement, which read as follows [original punctuation
provided]:
The Western Interstate Commission for Higher
Education, also known as WICHE, is a professional
student exchange program that provides students in 12
Western states access to professional healthcare
programs that are otherwise not available in their
home states. WICHE students pay reduced tuition fees
- usually resident tuition in public institutions or
reduced tuition at private schools.
WICHE is an important tool for accessing educational
opportunities that otherwise would be out of reach for
a number of reasons. HB235 expands the WICHE program
to include a loan forgiveness incentive for the
healthcare fields of dentistry, optometry, and
pharmacy.
As many of you may be aware, healthcare professionals
are needed in many areas of our state. We are also
seeing an increased number of professionals coming to
retirement age. For example, two dentists in the
Ketchikan area have actively been trying to sell their
practices without success because younger dentists are
not returning to this Alaskan community. Dr. George
Shaffer, who is on the line, can speak to this issue.
Over the years his practice has absorbed patients as a
courtesy to retiring dentists however, Ketchikan is
still lacking dentists and leaving a heavy burden on
others.
The student loan forgiveness program starts at a 25
percent forgiveness on the principal loan amount for
participants who maintain their Alaska residency and
return to the state for at least five years. An
additional 25 percent loan forgiveness is provided to
those who practice in an underserved area or serve
patients who are covered under the medical assistance
program.
9:30:22 AM
MS. KENDRA KLOSTER, Staff, to Representative Kathy Munoz, Alaska
State Legislature, explained the changes to each section of the
bill. Section 3 language was changed to clarify the forgiveness
increase for students practicing in underserved areas.
Returning to Section 2, she pointed out that the interest rate
has been amended to be more competitive and aligned with the
WICHE program. Also, the conditions of repayment have been
revised to be on par with the WICHE program; Sections 2 and 3.
9:31:39 AM
CHAIR SEATON asked for clarity regarding the criteria for
forgiveness.
9:31:52 AM
REPRESENTATIVE MUNOZ responded that forgiveness is five percent
per year, up to 25 percent, if they return. If they practice in
an underserved area, or accept Medicaid patients, it becomes 10
percent per year, for five years, or 50 percent.
9:32:22 AM
REPRESENTATIVE BUCH asked for a definition of underserved areas.
He said he located it in the original version, but not in the
committee substitute (CS).
9:33:09 AM
REPRESENTATIVE MUNOZ deferred to Dr. David Logan.
9:33:27 AM
CHAIR SEATON verified that Version A identifies underserved
area, and version R does not have the same language.
9:33:55 AM
MS. KLOSTER indicated that an underserved area is as defined by
the Department of Health and Social Services (DHSS).
CHAIR SEATON noted that Version A included Sec. 14.44.042, and
asked if the information has been omitted, or conformed
differently, in Version R.
9:35:01 AM
MS. BARRANS, offered her understanding that the draft allows the
commissioner of DHSS to designate an area as underserved, which
could be accomplished via regulation. Another means to identify
the standard could be based on the level of the percentage of
billing for services to patients that are receiving medical
assistance through a state program; page 2, lines 29-31, of
Version R.
9:35:59 AM
REPRESENTATIVE GARDNER suggested that the confusion may arise
due to the original draft referring to AS 14.44.042, and Version
R refers to AS 14.44.041.
9:36:24 AM
CHAIR SEATON drew attention to the original language of Version
A, lines 28-[30], where it states: "... if billings for
services provided to those patients are not less than five
percent of the participant's average gross billings for the
year; ...".
9:37:05 AM
REPRESENTATIVE BUCH clarified that his question arises from
[Version R, page 2], line 27, which states: "... in a
geographical area the commissioner of health and social services
has designated as underserved; ...". He expressed concern that
discretion would be the purview of the commissioner. Also, he
opined that this appears to be a vague definition, and asked
whether a clearer definition is included elsewhere in the bill.
CHAIR SEATON said that the provisions of the bill will be
discussed and debated, but the motion being considered is
whether to adopt Version R as a CS. The sectional description
may provide clarity, he suggested.
9:38:16 AM
MS. KLOSTER deferred to Dr. David Logan.
CHAIR SEATON said that if the language is in both versions it
does not need to be addressed, but if there is a change it
should be explained by the sponsor.
MS. KLOSTER noted again the forgiveness aspects, changed in Sec.
3, and the alignment of interest rates and repayment schedules
with the WICHE program.
9:40:05 AM
CHAIR SEATON pointed out that these are technical changes that
do not alter the majority of the bill, which the committee could
decide to amend at a future time. With that he removed his
objection. There being no further objection, Version R was
before the committee.
9:41:04 AM
DR. DAVID LOGAN, DDS, Alaska Dental Society, stated support for
CSHB 235, underscoring the importance of providing this avenue
of support for Alaska's young people to attend professional
institutes. Financial burdens are a reality, for entering and
completing programs to enter these professions; $250,000 for
dental schools. Part of the financial burden is deciding how to
repay the loan, where to establish a practice, and other
economic decisions that may not bring them back to Alaska. A
program of this type may take the edge off of the burden and
allow students to practice in the community of their choice.
Being a benefactor of the WICHE program, he attributed it as the
reason that he has been able to return to Alaska and practice.
9:43:55 AM
REPRESENTATIVE P. WILSON offered support for allowing DHSS to
determine the underserved areas, as these areas fluctuate
annually and can be like moving targets.
9:45:19 AM
REPRESENTATIVE EDGMON commented that this would allow the
commissioner of DHSS to match state and federal definitions of
underserved areas.
9:45:52 AM
DR. LOGAN concurred, and said that the dental state statutes are
already common to federal definition. He opined that an
underserved area may already be a common definition throughout
statutes regarding the entire health care profession.
9:46:22 AM
CHAIR SEATON provided a scenario of an area being serviced by a
sole dentist, who is expecting to receive a 10 percent loan
reduction. If another dentist arrives and begins practicing,
how will this affect the loan forgiveness status of the original
dentist; a question for Ms. Barrans, he said.
9:46:59 AM
REPRESENTATIVE MUNOZ said practices would be handled on a case
by case basis, but the specific scenario described by the chair
has not as yet been addressed.
9:47:11 AM
REPRESENTATIVE GARDNER asked if there is data from other states
to support this approach for changing the behavior of graduates
in establishing practices. Additionally, she said, there has
been an outpouring across Alaska regarding difficulty in getting
access to physicians, and dental care, but the shortage in
pharmacy and optometry is new. She asked what information is
available to support these professions as areas of identified
need.
REPRESENTATIVE MUNOZ said that the WICHE program supports
students who attend programs in states away from their home
state, in the absence of a local program. To that end, the
proposed legislation is a strong incentive for students to
return and practice in Alaska.
9:48:44 AM
REPRESENTATIVE GARDNER asked if this incentive matches or
exceeds what other states offer.
MS. KLOSTER said she would provide that information to the
committee.
REPRESENTATIVE GARDNER underscored that this could prove to be
important, as other states may provide a higher forgiveness rate
and Alaskan students may choose to relocate and take advantage
of that opportunity.
9:49:36 AM
REPRESENTATIVE KELLER queried how the five percent reduction was
chosen, as well as the limit of five students per professional
area, and whether other options were considered.
9:50:37 AM
REPRESENTATIVE MUNOZ responded that the Alaska Commission on
Postsecondary Education (ACPE) assisted in the drafting of this
legislation. The intention is to provide statute that can be
funded via the ACPE structure without additional state support.
9:51:14 AM
REPRESENTATIVE KELLER clarified that ACPE has prioritized the
needs of the areas covered in the bill.
9:51:38 AM
REPRESENTATIVE MUNOZ deferred to Diane Barrans.
9:51:50 AM
REPRESENTATIVE GARDNER reiterated her question on why this is
being extended to pharmacists and optometrists.
9:52:13 AM
REPRESENTATIVE MUNOZ deferred to the professionals who will
testify in their fields.
9:52:23 AM
CHAIR SEATON directed attention to page 1, line 5 [through 7],
and read: "... Notwithstanding the funding priorities
established under (a) of this section, the Alaska Commission on
Postsecondary Education shall provide adequate funding for not
fewer than five students ... ", and asked if the intention is to
supersede the funding priorities currently set forth in section
(a), and why that is being considered.
9:53:24 AM
MS BARRANS pointed out that this bill is an industry led piece
of legislation, and the three fields that are identified in the
bill are brought via advocacy efforts.
9:54:13 AM
CHAIR SEATON asked about the current funding priorities and
whether this bill elevates the three professional fields above
the established priorities.
9:54:43 AM
MS BARRANS recalled that the professional student exchange
program, through WICHE, was funded for the first 20-25 years
through general fund support. Subsequent to 1986 the program
was totally de-funded. In the mid 1990's, the program was
revived by the legislature, but set-up as a loan obligation,
rather than the state providing the support fee directly on
behalf of the Alaska residents participating. Alaskan students
were allowed to apply for loans, subject to the student loan
corporation's capacity to fund the program. The support fee
becoming an individual financial obligation is rather unusual
within the Professional Student Exchange Program (PSEP). Except
for Nevada, participating students do so at their home state's
expense, with no obligation on behalf of their residents to
practice within their home state, although it is encouraged.
Because the student loan corporation is expected to fund the
program, other criteria were put into place. The criteria
reside in AS 14.44.025, which would now be .025 (a), allowing
the Commission on Postsecondary Education to establish funding
priorities by regulation. Under the regulation, in order for a
field to be included in the program, three criteria must be met:
1) the graduate program is not offered in the state; 2) a
shortage of professionals in the state exists; 3) earnings
related to the profession are sufficient to allow obligation
repayment. The fields supported by the loan program include
dentistry, optometry, pharmacy, podiatry, as well as physical
and occupational therapy. The bill would mandate that at least
five participants in each of the three main fields would be
funded each year. She explained that because of the forgiveness
provision, the fiscal note indicates that the student loan
corporation could no longer be tapped as the funding resource.
Instead the loans will become general funded programs and the
repayment will constitute an income stream for the general
funds.
9:58:35 AM
CHAIR SEATON stated his understanding that the criteria used in
(a), of Section 1, elevates the named professions above any
other programs that would be established in this section;
mandating that there would be five students supported in these
fields before any of the other categories established by the
commission.
MS BARRANS concurred.
9:59:09 AM
CHAIR SEATON opened public testimony.
10:00:25 AM
NANCY DAVIS, Executive Director, Alaska Pharmacist Association
(AkPhA), stated support for HB 235, and SB 174, underscoring
that the cost to follow a career path in pharmacy has a price
tag of about $150,000. The path for professional fields has
changed over the years, she said, and pharmacy is now a post
doctoral program earning the Pharm.D moniker. A pre-pharmacy
program does exist in Alaska, and it would be helpful if
students could attend post doctoral programs at in-state tuition
prices. The average out-of-state tuition of the nine schools
surveyed one year ago represents a yearly differential of
$12,000-$13,000, or nearly $50,000 of additional tuition to
complete a program. The proposed loan forgiveness at the rate
of five percent for five years will at least pay this
differential, as well as being an investment in the future.
10:03:21 AM
REPRESENTATIVE GARDNER directed attention to the committee
packet and the letter of support provided by Amber Briggs, AkPhA
President. She read: "Because the health care workforce
shortage in Alaska is reducing health care access for our
state's residents, ... The Alaska Pharmacists Association
strongly supports the concept ...". There appears to be a lack
of data regarding a lack of pharmacists in the state, and she
asked for further information regarding the projected needs in
this field.
MS. DAVIS provided statistics from 2007 that the state derived
indicating a 25 percent deficiency in pharmacists. She opined
that it is difficult to recruit and retain pharmacists in
Alaska, hence the shortage. The loan forgiveness is an
important incentive for Alaskan students to return and practice.
State statistics, surveyed two years ago, indicated a shortage
of approximately 130 pharmacists. A shortage can become a
safety issue, she opined, when dispensing medication and working
long hours, errors can occur. The national average, for
community pharmacists, is a ratio of 5.36:100,000, but in Alaska
it is 3.35:10,000 people. To attain the national average,
Alaska would need to have 137 pharmacists join the current
ranks. The 15 Indian health service pharmacies were not
included in this calculation.
10:05:58 AM
CHAIR SEATON asked the bill sponsor to have the department
provide further information and data regarding the identified
needs of these professions.
10:06:21 AM
MS. DAVIS commented that the AkPhA is supportive of building a
school of pharmacy in the state, however, the pharmacists are
needed now, and it could take ten years to establish an
institution.
10:07:26 AM
GEORGE SHAFFER, DDS, stated the difficulty that students have in
receiving loans for attending school and establishing practices,
at a time when many professionals are entering the age of
retirement. He recalled how, many years ago, the state defined
shortage areas. Unfortunately, difficulties arose as the
definition was not particularly clear, and eventually the
federal definition was utilized and worked well. He cautioned
that to serve the needs of the state today, it should not be
left to federal purview alone, and the state should take an
active role to make designations. Making another point, he
said, a group of students who are already in school may not
qualify for this program. Because of the in-state tuition
differential, many may have given up their Alaskan residency, in
lieu of a lower tuition for graduate school. A provision could
be considered to assist these students to renew their residency
and qualify for the program, he opined.
10:10:29 AM
BARRY CHRISTIANSEN, Pharmacist, stated support for HB 235,
saying that he is a past participant in the WICHE program, and
it proved a benefit to him. He opined that there is a shortage
of pharmacists in Alaska, from his direct experience in the
field. Once students attend school out-of-state, there is a
good chance that they may not return, and this may prove to be
an incentive to remedy that phenomena, he said.
10:11:52 AM
JIM TOWLE, stated support for HB 235, stressing the need to
support the young students of today who are pursuing these
careers.
10:13:42 AM
REPRESENTATIVE MUNOZ reviewed the questions and comments that
arose from today's meeting, which require sponsor response: the
percentages of forgiveness offered in other states; statistics
supporting professional deficiencies in the field of optometry
in Alaska; a representative from DHSS to address the definition
of underserved areas; and an appropriate fiscal note.
10:14:26 AM
CHAIR SEATON concluded, thanking the participants in today's
meeting.
[HB 235 was held over.]
| Document Name | Date/Time | Subjects |
|---|---|---|
| ASD Memorandum # 96 (2009-2010).pdf |
HEDC 1/22/2010 8:00:00 AM |
|
| AK Pharmacists Assoc.pdf |
HEDC 1/22/2010 8:00:00 AM |
|
| HB235 version R.pdf |
HEDC 1/22/2010 8:00:00 AM HEDC 2/1/2010 8:00:00 AM |
HB 235 |
| HB235 Sponsor Statement.pdf |
HEDC 1/22/2010 8:00:00 AM HEDC 2/1/2010 8:00:00 AM |
HB 235 |
| sectional analysis.pdf |
HEDC 1/22/2010 8:00:00 AM |
|
| Memo from legal re bill changes.pdf |
HEDC 1/22/2010 8:00:00 AM |
|
| Ltr House Ed Comm RE HB235 WICHE.pdf |
HEDC 1/22/2010 8:00:00 AM HEDC 2/1/2010 8:00:00 AM |
HB 235 |