BILL ANALYSIS Ó AB 565 Page 1 CONCURRENCE IN SENATE AMENDMENTS AB 565 (Salas) As Amended September 3, 2013 Majority vote ----------------------------------------------------------------- |ASSEMBLY: |70-0 |(May 16, 2013) |SENATE: |39-0 |(September 9, | | | | | | |2013) | ----------------------------------------------------------------- Original Committee Reference: HEALTH SUMMARY : Revises the definition of a practice setting for purposes of the Steven M. Thompson Physician Corps Loan Repayment Program (STLRP) to include a physician owned and operated medical practice setting that provides primary care located in a medically underserved area (MUA), as specified. Revises the criteria of the STLRP to require that an applicant have three years providing health care services to medically underserved populations (MUPs) or in a MUA and to give priority consideration to applicants from rural communities who agree to practice in a physician owned and operated practice setting, as specified. Deletes the STLRP guideline that seeks to place the most qualified applicants in the areas with the greatest need and replaces it with the requirement that the STLRP gives preference to applicants who agree to practice in a federally designated health professional shortage area (HPSA) or MUA and who agree to serve a MUP. The Senate amendments delete the provisions lowering the percentage (30%) of patients who are enrolled in public programs, as specified, that a practice setting must serve to apply for the STLRP, and reverts to existing law requirements (50%). EXISTING LAW : 1)Establishes the Health Professions Education Foundation (HPEF) within the Office of Statewide Health Planning and Development (OSHPD) to, among other functions, develop criteria for evaluating applicants for various scholarships or loans. 2)Establishes the California Physician Corps Program, which consists of the STLRP and the Physician Volunteer Program, administered by HPEF. AB 565 Page 2 3)Requires STLRP to provide financial incentives, as specified, to applicants who possess a current valid medical or osteopathic license who practice in medically underserved communities, as specified. Allows up to 20% of the available positions to be awarded to applicants from specialties outside of primary care. Requires up to 15% of funds to be dedicated to loan assistance for physician and surgeons who agree to practice in geriatric settings. 4)Defines MUA as consistent with the federal definition of a HPSA or an area of the state where unmet priority needs for physicians exist as determined by the California Healthcare Workforce Policy Commission. 5)Defines MUP as Medi-Cal program and Healthy Families program recipients and uninsured populations. 6)Defines practice setting for purposes of the STLRP as either: a) A community clinic as defined, a clinic owned or operated by a public hospital and health system, or a clinic owned and operated by a hospital that maintains the primary contract with a county government to fulfill the county's role to serve indigent population, which is located in a MUA and at least 50% of whose patients are from a MUP; or, b) A medical practice located in a MUA and at least 50% of whose patients are from a MUP. AS PASSED BY THE ASSEMBLY , this bill lowered the percentage from 50% to 30% the number of patients that a practice setting must serve to qualify for the STLRP, as specified. FISCAL EFFECT : According to the Senate Appropriations Committee, minor, and absorbable costs. COMMENTS : The STLRP was established in 2003 to encourage recently licensed physicians to practice in HPSAs in California. STLRP authorizes a plan for repaying up to $105,000 in educational loans in exchange for full-time service for a minimum of three years. STLRP guidelines include giving priority consideration to applicants that are best suited to meet the cultural and linguistic needs and demands of patients AB 565 Page 3 from MUPs; giving preference to applicants who have completed a three-year residency in a primary specialty (family practice, internal medicine, pediatrics, or obstetrics/gynecology); and, placing the most qualified applicants in areas with the greatest need. In 2012, the Office of Statewide Health Planning and Development submitted its annual STLRP report to the Legislature. According to the report, since inception, the STLRP has awarded $17 million to 223 individuals. In 2011, HPEF awarded more than $4.1 million to 76 physicians (out of 185 applicants requesting approximately $17.6 million in loan repayments). Award recipients include individuals practicing at federally qualified health centers or look-alikes, community health centers, rural health centers, migrant health centers, public housing health centers, correctional facilities, and Indian health clinics. The report indicates that performance reviews of STLRP participants are conducted by HPEF through mandatory biannual reports which are completed and submitted by supervisors, clinic directors, or other appropriate managers of the practice settings where the participants are serving their service obligation. The report indicates that throughout the spring of 2011, HPEF developed a partnership with the Healthcare Workforce Development Council to leverage STLRP awards with matching funds from the Federal American Recovery and Reinvestment Act of 2009, and these matching funds were awarded to 61 of the 76 physicians selected. Analysis Prepared by : Rosielyn Pulmano / HEALTH / (916) 319-2097 FN: 0002297