BILL ANALYSIS Ó
AB 2048
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Date of Hearing: April 5, 2016
ASSEMBLY COMMITTEE ON HEALTH
Jim Wood, Chair
AB 2048
Gray - As Amended March 16, 2016
SUBJECT: National Health Service Corps State Loan Repayment
Program.
SUMMARY: Requires the Office of Statewide Health Planning and
Development (OSHPD), in its administration of the National
Health Service Corps State Loan Repayment Program (SLRP), to
include all federally qualified health centers (FQHCs) located
in California on the program's certified eligible site list.
Specifically, this bill:
1)Requires OSHPD to notify all certified eligible sites when the
program opens each application cycle, and to maximize, to the
extent possible, the number of applications received each
cycle.
2)Prohibits OSHPD from requiring program applicants and
participants to provide matching funds in years that OSHPD
receives state matching funds.
3)Requires OSHPD to submit an annual report to the Senate and
Assembly Committees on Health that includes all of the
following information:
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a) The number of applications received during the annual
application cycle;
b) The percentage of applicants who were awarded funding
under the program; and,
c) The percentage of funding that went to each geographic
region in the state.
4)Continuously appropriates $1 million from the General Fund
(GF), without regard to fiscal year, to OSHPD for purposes of
providing state matching funds for the SLRP.
EXISTING LAW: Requires OSHPD, in its administration of the SLRP
to strive, whenever feasible, to equitably distribute loan
repayment awards between eligible urban and rural program sites,
after taking into account the availability of health care
services in the communities to be served and the number of
individuals to be served in each program site.
FISCAL EFFECT: This bill has not been analyzed by a fiscal
committee.
COMMENTS:
1)PURPOSE OF THIS BILL. According to the author, FQHCs are
safety net providers that serve some of the nation's most
vulnerable populations. The author states they are required
to offer services to all persons regardless of their ability
to pay, be a nonprofit or public organization, serve a
medically underserved area, and provide comprehensive primary
care services. The author contends that FQHCs reduce health
disparities by serving populations that would otherwise not
have access to services, and care received at these centers is
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ranked among the most cost-effective, producing $24 billion in
annual health system savings, yet studies have found that the
quality of care provided is equal to or even greater that the
quality of care provided elsewhere.
The author notes the SLRP was created in 1987 to increase and
retain the number of primary care physicians, dentists, nurse
practitioners, pharmacists, and mental and behavioral
specialists in Health Professional Shortage Areas (HPSAs), and
while the SLRP is an important program to recruit healthcare
professionals to communities in need, FQHCs face burdensome
obstacles to participation. The author states that, despite
their federal designation, each FQHC is required to submit an
application to be placed on the list of Certified Eligible
Sites (CES) before applicants from their facility may be
considered for loan repayment. Additionally, FQHCs must renew
their application every three years to continue participation
in the SLRP. The author contends that, as a result of these
requirements, less than one-third of the health centers in the
state are currently listed on the CES. The author also notes
that federal SLRP dollars require a state match, and, while
other states provide this match themselves, California has
shifted that cost onto the health centers. The author points
out that California receives only $1 million in federal
funding annually, and many small and medium size health
centers that cannot afford to provide matching funds are
precluded from SLRP participation.
The author concludes that this bill will streamline
participation in the SLRP by eliminating CES application and
renewal requirements for FQHCs, creating notification and
reporting requirements to keep health centers and the
Legislature informed about the program, and lifting the
financial burden of providing matching funds off the shoulders
of the health centers.
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2)BACKGROUND.
a) FQHCs. As noted by the author, FQHCs serve a
significant portion of the uninsured and underinsured in
California. They are open-door providers that treat
patients on a sliding scale fee structure and make their
services available regardless of a patient's ability to
pay. There are approximately 600 FQHCs in California. All
FQHCs are either non-profit community clinics or government
entities. Community clinics and health centers provide
health care to 14% of Californians. This figure is even
higher in rural or remote areas that struggle to attract
and retain health care providers.
b) The California State Loan Repayment Program. SLRP was
congressionally authorized in 1987 under the U.S. Public
Health Services Act. SLRP increases the number of primary
care physicians, dentists, dental hygienists, physician
assistants, nurse practitioners, certified nurse midwives,
pharmacists and mental/behavioral health providers
practicing in federally designated California HPSAs. SLRP
authorizes repayment of qualified educational loans for
eligible primary health care professionals, who must commit
to an initial two year full-time or four year half-time
service agreement to provide direct patient care in a
primary, dental, or mental health HPSA.
In order for a site to be eligible to host SLRP providers, it
must:
i) Be located in a federally designated HPSA;
ii) Be a public or private, not-for-profit, out-patient
facility;
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iii) Match the SLRP award, on a dollar-for-dollar basis;
iv) Pay the provider a prevailing wage; and,
v) Provide services on a free or reduced fee schedule
basis to individuals at or below 200% of the federal
poverty level.
The purpose of the CES list is to identify those sites that
are located in a HPSA and agree to match the SLRP award
amount. When a site submits a CES application, SLRP
determines if the site is located in a HPSA, if the site is
in Northern, Central, or Southern California, and if it is
in a Rural, Urban, or Frontier area. (A "Frontier area" by
federal definition, is an area with population density of
less than 11 persons per square mile). HPSA site
designations are valid for three years; then they must be
recertified by SLRP to ensure they are still located in a
HPSA. If a site loses its HPSA designation, it is no
longer an eligible site. FQHCs are automatically approved
HPSA designations through the NHSC. However, SLRP does not
currently automatically approve all FQHCs; if SLRP did, it
would be assuming all FQHCs could match the SLRP award
amount.
SLRP is federally funded through a grant from the Health
Resources and Services Administration. SLRP receives $1
million per grant year. The number of awards given out
depends upon how many applications are received. Because
the purpose of SLRP is to recruit and retain high quality
healthcare professionals working in HPSAs, applicants
requesting an extension usually receive an award.
The table below shows the areas of the state where current
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awarded providers are practicing:
---------------------------------------------------------
| 2013 | 2014 | 2015 |
---------------------------------------------------------
|---------+--------+----------+--------+---------+--------|
|Central |Frontier|Central |Frontier|Central |Frontier|
| 13| 0| 28| 0| 26| 0|
|---------+--------+----------+--------+---------+--------|
|Northern |Rural |Northern |Rural |Northern |Rural |
| 10| 11| 10| 21| 12| 15|
|---------+--------+----------+--------+---------+--------|
|Southern |Urban |Southern |Urban |Southern |Urban |
| 21| 33| 32| 49| 25| 48 |
---------------------------------------------------------
c) SLRP participation. Currently, there are 415 SLRP
Certified Eligible Sites: 392 primary care, 165 mental
health, and 135 dental health. Four are located in
Frontier areas, 140 in Rural areas, and 271 in Urban areas.
OSHPD notifies all CES when the application cycle opens up
each year. OSHPD/SLRP sends stakeholder announcements,
updates the SLRP Website and contacts current awardees
(healthcare providers) who are eligible for an extension
award. The CES application is open year-round. The
provider application cycle is tentatively set for August 1
to October 1 of each year but has varied the last few years
due to the implementation of OSHPDs online application
system.
3)SUPPORT. The California Primary Care Association, Community
Clinic Association of Los Angeles, and Redwood Community
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Health Coalition all support this bill stating that it is a
simple, yet effective way to support community health centers
ability to recruit and retain providers by strengthening SLRP.
The proponents note that at a time when our state's
underserved communities are grappling with a severe and
growing primary care provider shortage, SLRP increases the
number of primary care providers practicing in federally
designated HPSAs, however SLRP is currently structured in a
way that disincentives participation among FQHCs who serve
low-income and uninsured communities. The supporters conclude
that this bill will address these challenges by streamlining
participation in the SLRP through automatic enrollment for
FQHCs as CES.
The Association of California Healthcare Districts (ACHD) notes
that as the demand for physicians rises with the
implementation of the Pateint Protection and Affordable Care
Act, it is of utmost importance that California be innovative
in addressing physician shortage issues in underserved areas,
where many FQHC's operate. ACHD also states, by appropriating
the necessary funds for the SLRP, California will continue to
promote access to healthcare in the most underserved areas of
the state.
4)PREVIOUS LEGISLATION. AB 820 (Nakanishi) Chapter 682,
Statutes of 2003, requires OSHPD, in administering SLRP, to
strive, whenever feasible, to equitably distribute loan
repayment awards between urban and rural program sites, after
taking into account the availability of health care services
in the communities to be served and the number of individuals
to be served in each program site. Requires that all eligible
applications be given consideration before any award is
granted.
5)TECHNICAL AMENDMENT. As currently drafted this bill requires
OSHPD to include all FQHCs located in California on the SLRP
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program's CES list. However, by deleting the requirement for
FQHCs to reapply to be on the list, this bill removes the
mechanism by which SLRP/OSHPD determines if an FQHC is still
in a HPSA and willing to match the funds. This bill should be
amended to require the provider's site to certify their
agreement to match the SLRP award as part of the provider's
application in any year OSHPD does not receive state matching
funds.
REGISTERED SUPPORT / OPPOSITION:
Support
APLA Health & Wellness
Association of California Healthcare Districts
California Primary Care Association
Central Valley Health Network
Coalition of Orange County Community Health Centers
Community Clinic Association of Los Angeles
Community Clinic Consortium
Health Alliance of Northern California
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La Clinicia de La Raza
Los Angeles LGBT Center
Marin Community Clinics
Neighborhood Healthcare
Northeast Valley Health Corporation
Redwood Community Health Coalition
Sacramento Native American Health Center, Inc.
San Ysidro Health Center
South Central Family Health Center
Opposition
None on file.
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Analysis Prepared by:Lara Flynn / HEALTH / (916) 319-2097