SENATE BILL NO. 139 "An Act establishing a loan repayment program and employment incentive program for certain health care professionals employed in the state; and providing for an effective date." 9:49:01 AM Co-Chair Hoffman MOVED to ADOPT CSSB 139 (FIN), labeled 26- LS0503\N, Mischel, 3/29/10. Co-Chair Stedman OBJECTED. Senator Olson, sponsor, related that the bill establishes a loan repayment program and employment incentives for a number of health care professionals employed throughout the state. It addresses an immediate need. The bill distinguishes itself from other scholarship bills by providing immediate results when filling vacancies. It does not require waiting for students to "come through the pipeline" before they can begin their practice. It also targets experienced providers who are ready to go to work. The funds will be issued after the work has been performed and payments will be stopped if the practitioner leaves the state or designated area. It is not a loan and has no defaults. There is a preference for Alaskans; however, graduates from elsewhere can come to Alaska to take advantage of the loan repayment program. Senator Olson stressed that one of the focuses is on recruiting physicians because of their expertise. 9:51:14 AM DENISE LICCIOLI, STAFF, SENATOR OLSON, explained the changes in the bill. The first change is on page 1, line 8, and on page 2, lines 9-10, the words, "by the state" were added in order to limit loan repayments to loans held by the state. The second change was made by adding a new section on page 5, beginning on line 9. The section provides clarification to the department for the intention of the legislation to limit the number of participants to 90 per year, regardless of whether the participant was a new participant or a continuing participant. It would also provide guidance to ensure that at least three of each practitioner type was reserved for filling in a very hard- to-fill location. The intention is to address health care shortages in various areas of the state. 9:53:58 AM Senator Thomas wondered if there was an hour requirement prior to receiving a license for certain participants. Ms. Liccioli said the bill targets those who are or who would be licensed by the state to practice their preferred occupation. Co-Chair Stedman WITHDREW his OBJECTION. There being NO OBJECTION, Version N was adopted. Senator Olson said the bill addresses in a comprehensive manner, important health care issues. 9:56:12 AM Ms. Liccioli provided information about the bill: Alaska is facing a serious shortage of healthcare practitioners, especially in the rural areas of our state, and it is projected to worsen significantly in the next few decades. Senate Bill 139 is intended to address this issue by establishing a program to immediately begin filling the vacant healthcare practitioner positions throughout the state. This legislation will establish a direct incentive and loan repayment program, for loans held by the State of Alaska, in the Department of Health and Social Services. The program is designed to be competitive with incentives offered by other states and attract and retain healthcare practitioners. SB 139 will provide direct incentives and loan repayments for 10 different health care occupations, categorized by "Tier". Tier 1 slots include physicians, pharmacists and dentists. Tier 2 slots include dental hygienists, registered nurses, certified nurse practitioners, physician assistants, physical therapists, clinical psychologists, and clinical social workers holding at least a master's degree in social work. The slots are also categorized by whether they are in a "regular" site, which can be located anywhere in the state; or whether they are in a "very-hard-to-fill" site, which can be located only in areas designated as such by the Commissioner of Health and Social Services. The sites would not be exactly the same as the federal designations. The amount of the incentive for each slot varies according to location and the category, or "Tier", of healthcare provided. Tier 1 slots have incentives of up to $35,000 per year at a regular site, or up to $47,000 per year at a very-hard-to-fill site. Tier 2 slots have incentives of up to $20,000 per year at a regular site, or up to $27,000 per year at a very- hard-to-fill site. The bill provides direct incentives and loan repayments for 9 slots or positions for each occupation. The bill requires that at least 3 of the 9 slots for each occupation are reserved for "very-hard- to-fill" positions; the remaining slots for each occupation can be anywhere based on applications and need. The fiscal note allows for funding of 6 positions in "very-hard-to-fill locations. Priority will be given to sites that treat patients who are uninsured and who have medical assistance or Medicare coverage. The maximum slots for which an incentive or loan payment is made in any given year is capped at 90. She emphasized that it is 90 per year in order to provide more flexibility. 9:59:28 AM Eligible individuals are provided their incentive and/or loan repayment in quarterly installments, only after working the previous three months, for a contract term of 3 years. The program allows for a possible extension up to an additional 3 years, but has a lifetime maximum of 6 years for any individual to participate. Individuals would have to apply for an extension. Payments stop immediately if the practitioner leaves their position. There is no risk of loan default since it is not a loan program and funds are only issued after the work is performed. The employer of the participant will be required to match the amount provided to the participant based on the employer's ability to pay, as determined by the Commissioner. The match can range from nothing to 50% of the total. For purposes of the fiscal note, a 25% match is assumed, to allow for that range. SB 139 is an effective way to address the shortage of healthcare practitioners quickly and targets experienced practitioners who are ready to work. Although preference can be given to Alaskans, practitioners can be from anywhere in the nation. If passed, this legislation is expected to attract healthcare practitioners from all areas of the country, which will give us a bigger pool of qualified, experienced healthcare professionals from which to choose; and which will help to assure our ability to fill the available slots. The program established by this bill will be an effective complement -- not a replacement -- to other programs such as WWAMI and would fill the gap existing while students are going to school and until they are able to practice their chosen field. In other words there will be immediate results for filling vacancies; no waiting for a student to become a practitioner. It is critical that we promptly address Alaska's healthcare shortages in order to ensure that all Alaskans have adequate access to medical care. SB 139 helps us to save and improve the lives of our constituents by allowing us to provide for those who cannot wait until tomorrow to get the care that they need today. 10:01:57 AM Senator Thomas referred to page 5 and asked if the person can receive loan repayments if they are not yet licensed, but are in the program. Ms. Liccioli pointed to page 5, line 21, to show that they must become licensed within 90 days of their first day of employment. 10:03:00 AM Co-Chair Stedman noted two fiscal notes; one zero note from the Department of Education and Early Development, and one fiscal note from the Department of Health and Social Services for $2,882,300 in general funds to cover the estimated cost of incentive payments and to hire one additional full-time staff person to administer the program. Ms. Liccioli believed the two new notes reflect the new CS. 10:04:15 AM LANETTA LUNDBERG, DIRECTOR, HUMAN RESOURCES, KETCHIKAN GENERAL HOSPITAL (via teleconference), spoke in favor of SB 139. She highlighted the benefits of the legislation. 10:06:00 AM JERRY GRONEN, WASILLA (via teleconference), explained that he is a student who will accumulate $70,000 in student loans. He testified in favor of SB 139 and the reimbursements and incentives it provides. JIM LYNCH, CHIEF FINANCE OFFICER, FAIRBANKS MEMORIAL HOSPITAL (via teleconference), spoke in favor of SB 139. He brought up the problem of retiring health care workers and the difficulty of trying to fill positions, especially in rural areas. JIM JORDAN, EXECUTIVE DIRECTOR, ALASKA STATE MEDICAL ASSOCIATION (via teleconference), spoke in favor of the legislation. He said the pool of physicians available for recruitment from around the country has been reduced by a growing tendency of a reduction in patient care hours. He highlighted the results of health care reform in Massachusetts in 2006. 10:12:15 AM DR. DON PATHMAN, PHYSICIAN, UNIVERSITY OF NORTH CAROLINA (via teleconference), spoke of his experience studying the outcomes of loan repayment and incentive programs in the health profession. He referred to handouts provided to the committee. He agreed with SB 139 and testified about the effectiveness of the loan repayment incentive. 10:15:35 AM ELIZABETH RIPLEY, MATSU HEALTH FOUNDATION (via teleconference), spoke in favor of SB 139. She listed the benefits of her program. She voiced concern about understaffing. She referred to a resolution included in the members' packets. She shared statistics about medical providers. 10:19:14 AM SAM TRIVETTE, JUNEAU, spoke in favor of SB 139 because it would attract health care workers and increase care for retirees. He spoke of keeping retirees in Alaska and the necessity to providing health care for them. SHELLEY HUGHES, GOVERNMENT AFFAIRS DIRECTOR, ALASKA PRIMARY CARE ASSOCIATION, testified in favor of SB 139. She shared concerns about the shortage in Alaska of primary care providers. She urged passage of the bill. 10:24:09 AM NANCY DAVIS, RN, PRESIDENT, ALASKA NURSES ASSOCIATION, JUNEAU, added her organization's support for SB 139. MARIE DARLIN, AARP, testified in support of SB 139. She reminded the committee that Alaska would lose if seniors move away due to inadequate health care. 10:26:48 AM NANCY O. DAVIS, EXECUTIVE DIRECTOR, ALASKA PHARMACY ASSOCIATION, spoke in favor of the legislation. She said the bill will allow health care workers to be recruited. 10:27:52 AM Senator Olson stressed that Alaska is losing the battle to keep up with adequate health care providers. He emphasized that large school debt is forcing medical professionals to work in major metropolitan areas. This legislation allows the state to have an incentive program. Alaska is one of three states that do not currently have such a program. He requested the committee's support for the bill. 10:28:54 AM Senator Huggins agreed with Senator Olson about not losing any battles. He thanked Senator Olson for sponsoring the legislation. SB 139 was heard and HELD in Committee for further consideration. SENATE BILL NO. 174 "An Act relating to professional student exchange program availability and conditions for loan forgiveness." SB 174 was SCHEDULED but not HEARD. SENATE BILL NO. 235 "An Act relating to charter school approval and funding." SB 235 was SCHEDULED but not HEARD. SENATE BILL NO. 236 "An Act relating to tax credits for cash contributions by taxpayers that are accepted for certain educational purposes or for a college facility; and providing for an effective date." SB 236 was SCHEDULED but not HEARD. SENATE BILL NO. 224 "An Act establishing the governor's performance scholarship program and relating to the program; establishing the governor's performance scholarship fund and relating to the fund; relating to student records; making conforming amendments; and providing for an effective date." SB 224 was SCHEDULED but not HEARD.