Legislature(2003 - 2004)

05/06/2003 01:35 PM Senate L&C

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                  SB 154-NURSE EDUC LOAN REPAYMENT PROGRAM                                                                  
     CHAIR BUNDE announced SB 154 to be up for consideration.                                                                   
     SENATOR FRENCH, sponsor, told members:                                                                                     
     SB 154 addresses  one big issue, which  is the shortage                                                                    
     of  nurses in  the State  of Alaska.  According to  the                                                                    
     Alaska  Community   Health  and   Emergency  Management                                                                    
     Services,   about   30   communities  in   Alaska   are                                                                    
     designated  as  federal  health  professional  shortage                                                                    
     areas.  Another  study  by  the  Alaska  Colleagues  in                                                                    
     Caring showed a  vacancy rate for RNs  across the state                                                                    
     of 11.5% in  2002 and in other parts of  the state as a                                                                    
     20.8% vacancy  rate. The  rate of  turnovers in  RNs in                                                                    
     Alaska is  24% and probably most  interestingly, in the                                                                    
     year  2001, about  18% of  RNs working  in Alaska  were                                                                    
     non-residents, i.e.  traveling nurses and about  52% of                                                                    
     the RNs were over 45 years old.                                                                                            
     The  need for  nurses is  going to  double by  the year                                                                    
     2010.  We've got  about 4,500  nurses  employed in  the                                                                    
     state right  now; the number  is going to go  to 8,500.                                                                    
     In the face of that  growing problem, we looked at ways                                                                    
     to increase the  number of nurses in the  state so that                                                                    
     our  citizens would  have adequate  health care  should                                                                    
     they  need it.  We  mulled over  a  bunch of  different                                                                    
     possibilities   and   arrived   at   this   one   after                                                                    
     discussions with  a variety  of interested  groups. The                                                                    
     idea is  to pay money  each year to nurses  employed in                                                                    
     the   state  in   qualifying   positions  and   correct                                                                    
     qualifying education,  to pay them  up to 20%  of their                                                                    
     student loan or $2,000, whichever  is less. The idea is                                                                    
     to  string those  payments out  over a  period of  five                                                                    
     years so  as to keep  folks who  come here who  may see                                                                    
     this as  an incentive  to move to  the state,  who come                                                                    
     here and  take up  jobs and  get them  to spend  a long                                                                    
     enough time here  so that they'll grow to  love it like                                                                    
     most of  the rest of  us have  and keep them  here when                                                                    
     their five-year period is up.                                                                                              
     The idea is, frankly,  workforce development and to use                                                                    
     a  little bit  of government  stimulus to  increase the                                                                    
     number  of  nurses  working  here  in  the  state.  The                                                                    
     University  of  Alaska  has recently  gotten  money  to                                                                    
     double the  size of its nursing  program. Nevertheless,                                                                    
     that  program  is going  to  graduate,  even once  it's                                                                    
     fully up  and running, about  220 nurses a  year, which                                                                    
     is nowhere near the number  the state needs to maintain                                                                    
     an adequate nursing population....                                                                                         
SENATOR STEVENS asked if the goal is to attract people from                                                                     
other states.                                                                                                                   
     SENATOR FRENCH  answered that  is correct  and, according  to the                                                          
     Department  of  Labor  and  Workforce  Development,  the  nursing                                                          
     shortage is  nationwide. Alaska must  compete for RNs  or educate                                                          
     its own nurses to keep up  with demand caused by an aging society                                                          
     and the aging of RNs.                                                                                                      
     SENATOR STEVENS asked what percentage is traveling nurses.                                                                 
     SENATOR FRENCH  replied 17.7%  of the RNs  working in  Alaska are                                                          
     MS. CATHY  GIESSEL, Alaska Nurse Practitioners  Association, said                                                          
     that Senator  French did  a great job  of portraying  the problem                                                          
     and  that  they  support  SB  154. She  asked  the  committee  to                                                          
     remember that when  there aren't enough nurses to  fill the jobs,                                                          
     less  qualified  personnel fill  them  and  in many  cases  those                                                          
     employees give  medications. She  said she gets  recruiting calls                                                          
     from the  Lower 48  and noted,  "I believe this  bill would  be a                                                          
     wonderful recruitment device."                                                                                             
     MS. GIESSEL  said that  Florida, South  Dakota and  Virginia have                                                          
     loan repayment program offers for nurses.                                                                                  
     CHAIR BUNDE noted  that in two years this bill,  if passed, would                                                          
     cost the  state about $3 million  and, in five years,  would cost                                                          
     over $5 million.                                                                                                           
     MS.   CAMILLE   SOLEIL,   Executive   Director,   Alaska   Nurses                                                          
     Association, agreed  with previous  testimonies and  supported SB
     154.  She really  likes  the  discretion given  to  the Board  of                                                          
     Nursing that  allows it to target  the funds toward the  areas of                                                          
     need and  set up appropriate  criteria. It doesn't  guarantee the                                                          
     right to  the loan forgiveness.  The average graduating  nurse is                                                          
     looking at  $20,000 to $40,000 in  student loans that need  to be                                                          
     repaid. Nurses  like to  retire between  the ages  of 55  and 60,                                                          
  especially out of acute care where they are needed the most.                                                                  
     CHAIR BUNDE noted  the discretionary part of  any potential state                                                          
     subsidy soon disappears in the  public's mind. When the longevity                                                          
     bonus first passed,  it was said in  the record that in  15 or 20                                                          
  years, if the state can't afford it, it can just cut it out.                                                                  
     MS. LARAINE  DERR, President, Alaska  State Hospital  and Nursing                                                          
     Home  Association, said  she  has talked  to  the legislature  in                                                          
     previous years  about the impending nursing  shortage crisis. She                                                          
     is in  the process of doing  a survey and has  results from seven                                                          
of 17  hospitals. Last year  they spent $16 million  on traveling                                                               
nurses. That  money doesn't  necessarily stay  in the  state. She                                                               
said  the  University  is  doubling   the  number  of  nurses  it                                                               
graduates  by  2006  and  industry is  donating  more  than  $2.3                                                               
million over the next three years,  however there is a problem in                                                               
finding the faculty, as there is a shortage there as well.                                                                      
SENATOR  STEVENS  said the  loans  would  repay not  only  Alaska                                                               
student loans, but out-of-state loans as well.                                                                                  
MS. DERR replied that is correct.                                                                                               
SENATOR  FRENCH  said  he contemplated  setting  the  forgiveness                                                               
provision up for Alaska residents  who, for example, went outside                                                               
to school and  came back, but that wouldn't  supply enough nurses                                                               
to fill the vacancies.                                                                                                          
CHAIR BUNDE asked how he defines a resident.                                                                                    
SENATOR FRENCH  replied that tying  eligibility to  the Permanent                                                               
Fund is a  possibility. He added that the size  of the loan could                                                               
be lowered to reduce the impact to the state.                                                                                   
SENATOR  SEEKINS asked  how the  University plans  to double  the                                                               
output of nurses with a zero budget increase.                                                                                   
SENATOR FRENCH  replied that the  University got more  money this                                                               
year [for that program].                                                                                                        
SENATOR SEEKINS said  that issue is before  the Finance Committee                                                               
and cannot be counted on.                                                                                                       
TAPE 03-29, SIDE B                                                                                                            
SENATOR  SEEKINS  asked  if  the  money to  be  provided  to  the                                                               
University program is matching money or what.                                                                                   
MS. DERR replied  that the University is going to  match the $2.3                                                               
million.  She explained  that  the University  of  Utah has  been                                                               
providing distance  delivered nursing education here  and through                                                               
the process of getting more  nurses, she realized that Alaska was                                                               
paying money  to Utah to educate  our students. That is  why they                                                               
came up  with the money and  the University matched it.  Utah has                                                               
agreed that it  will no longer be providing  nursing education in                                                               
the state when the University of Alaska takes it over.                                                                          
     CHAIR BUNDE said  he wished the university would use  some of the                                                          
 $5 million they use on intercollegiate athletics for nursing.                                                                  
     SENATOR STEVENS said he likes this  bill because it is similar to                                                          
     one that  he has been  working on about forgiveness  of teachers'                                                          
     loans.  He  said  all  the  money  in  the  fund  is  subject  to                                                          
     appropriation by the legislature each year.                                                                                
     MS.  DIANE  BARRANS,  Executive  Director,  Alaska  Postsecondary                                                          
     Education  Commission (ACPE),  supported SB  154. The  Commission                                                          
     would  administer   the  benefits  as   they  are  paid   out  to                                                          
     individuals who  qualify under the  criteria set by the  Board of                                                          
     Nursing. Also,  she suggested the  legislature might  look toward                                                          
     the  Alaska Student  Loan Corporation  dividend for  the funding,                                                          
     although  the fiscal  note calls  for an  appropriation from  the                                                          
     general fund each year.                                                                                                    
     CHAIR BUNDE  asked what  the fiscal  note would  be for  the bill                                                          
     that Senator Stevens is working on.                                                                                        
     MS. BARRANS replied  that those costs are  somewhat comparable to                                                          
     this bill.                                                                                                                 
     CHAIR BUNDE asked if she worked  with the Legislature a few years                                                          
     ago  when   the  Washington,   Alaska,  Montana,   Idaho  Medical                                                          
     Education   Program   (WAMI),   that  subsidizes   doctors,   was                                                          
     restructured  so  those  students  had to  repay  some  of  their                                                          
     subsidy if they didn't come back to Alaska and work.                                                                       
     MS. BARRANS replied that she did.                                                                                          
     CHAIR BUNDE  asked her  how effective that  has been  in bringing                                                          
     students back to Alaska to practice.                                                                                       
     MS. BARRANS  replied at  this point none  of those  students have                                                          
     reached  the point  in  their  careers yet  where  they would  be                                                          
     returning to  the state.  She the  suggested, to  prevent putting                                                          
     the  legislature in  a  position of  being  morally obligated  to                                                          
     forgive loans,  that ACPE solicit for  participants, identify the                                                          
     amount of debt that would be  repaid as a benefit, and reserve at                                                          
     the  time they  begin their  service  in Alaska  the amount  that                                                          
     would be  paid to  them. That  way, they would  not be  saying to                                                          
     those participants  the state  can pay for  their first  year but                                                          
     not  their second  year, etc.  In the  years when  no funding  is                                                          
     available,  they would  shut off  enrollment so  no one  would be                                                          
     enrolled for  benefits that were,  at best,  speculative. Numbers                                                          
     would be revisited on an annual basis.                                                                                     
CHAIR BUNDE  said some places  have provided  substantial bonuses                                                               
to attract  people to come  to work in  an area of  shortage, but                                                               
after acquiring the  bonuses they moved elsewhere. He  asked if a                                                               
nurse had  to work here for  five years, whether he  or she would                                                               
be free to move after that.                                                                                                     
MS. BARRANS said that is correct.                                                                                               
CHAIR BUNDE asked if this bill would reimburse any originator.                                                                  
MS. BARRANS replied any commercial lender.                                                                                      
CHAIR BUNDE  asked how  limiting this bill  to only  borrowers of                                                               
Alaska loans would impact the fiscal note.                                                                                      
MS.  BARRANS guessed  that it  would potentially  cut the  fiscal                                                               
note in half.                                                                                                                   
MS.  RHONDA RICHTSMEIER,  Deputy  Chief,  Public Health  Nursing,                                                               
agreed with  the nursing shortage  estimates: in 2000,  30 states                                                               
had  significant nursing  shortages and  in 2020,  46 states  are                                                               
anticipated to  have shortages. She  said the reasons  are multi-                                                               
pronged. There is  an aging population with  more chronic disease                                                               
and 71 percent of nurses in Alaska  are 41 to 71 years of age; 25                                                               
percent of those are going to retire in the next 5 to 10 years.                                                                 
MS. RICHTSMEIER  said fewer students are  graduating from nursing                                                               
schools.  It is  difficult to  get people  interested in  nursing                                                               
because a  lot of alternative  careers offer higher  salaries. In                                                               
addition, there  aren't enough  nursing instructors.  Since 1995,                                                               
there  has  been  a  31%  reduction in  the  number  of  students                                                               
graduating from colleges of nursing.  She believes there needs to                                                               
be a  multi-pronged approach to this  multi-pronged problem. They                                                               
need to  address salary to  bring new people into  the profession                                                               
and keep them in the profession.                                                                                                
SENATOR  DAVIS asked  her  to  comment on  the  cost of  training                                                               
nurses instate and out-of-state.                                                                                                
MS. RICHTSMEIER responded that she  could only speak recently for                                                               
instate  and that  UAA's four-year  program costs  around $20,000                                                               
just for tuition and books.                                                                                                     
SENATOR SEEKINS asked if the  administration supports the bill as                                                               
     MS. RICHTSMEIER said she understood that to be the case.                                                                   
     SENATOR  DAVIS  moved   to  pass  SB  154   from  committee  with                                                          
     individual   recommendations  and   the  attached   fiscal  note.                                                          
     SENATORS  FRENCH, STEVENS  and DAVIS  vote yea;  SENATORS SEEKINS                                                          
     and BUNDE voted nay; and SB 154 passed from committee.                                                                     

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