BILL ANALYSIS                                                                                                                                                                                                    Ó






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          |SENATE RULES COMMITTEE            |                         SB 22|
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                                   THIRD READING 


          Bill No:  SB 22
          Author:   Roth (D)
          Amended:  6/2/15  
          Vote:     21  

           SENATE HEALTH COMMITTEE:  9-0, 4/29/15
           AYES:  Hernandez, Nguyen, Hall, Mitchell, Monning, Nielsen,  
            Pan, Roth, Wolk

           SENATE APPROPRIATIONS COMMITTEE:  7-0, 5/28/15
           AYES:  Lara, Bates, Beall, Hill, Leyva, Mendoza, Nielsen

           SUBJECT:   Residency training


          SOURCE:    Author
          
          DIGEST:  This bill requires the Office of Statewide Health  
          Planning and Development (OSHPD) to establish a non-profit  
          public benefit corporation to be known as the California Medical  
          Residency Training Foundation (Foundation), as specified. This  
          bill requires the Foundation to be governed by a board of  
          trustees, as specified. This bill specifies the duties of the  
          Foundation and OSHPD for the purposes of establishing and  
          funding new residency positions in underserved areas of the  
          state.
          
          ANALYSIS:

          Existing law:
          
          1) Establishes the California Healthcare Workforce Policy  
             Commission (Commission) and requires the Commission to, among  








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             other things, identify specific areas of the state where  
             unmet priority needs for primary care family physicians and  
             registered nurses exist; establish standards for family  
             practice training programs, family practice residency  
             programs, primary care physician assistants programs, and  
             programs that train primary care nurse practitioners; and  
             review and make recommendations to OSHPD about funding of  
             those programs.

          2) Establishes the Health Professions Education Foundation  
             (HPEF) within OSHPD.  Requires the HPEF to solicit and  
             receive funds from Foundations and other private and public  
             sources and to provide financial assistance in the form of  
             scholarships or loans to students in the health professions  
             who are from underrepresented groups. Establishes, under the  
             HPEF, scholarship, loan, and loan repayment programs for  
             registered nurses, vocational nurses, geriatric nurse  
             practitioners, clinical nurse specialists, and mental health  
             professionals who agree to practice for specified periods of  
             time in underserved areas and in designated practice  
             settings, as specified.  

          3) Establishes, under HPEF, the Steven M. Thompson Physician  
             Corps Loan Repayment Program, which provides for the  
             repayment of educational loans for licensed physicians and  
             surgeons who practice in medically underserved areas of the  
             state, as defined.   

          4) Establishes within OSHPD the Health Professions Education  
             Fund to receive funds for scholarships and loans to students  
             from underrepresented groups who are enrolled in or accepted  
             to schools of medicine, dentistry, nursing, and other health  
             professions.  

          5) Establishes the Song-Brown Health Care Workforce Training Act  
             of 1973, administered by OSHPD to provide financial support  
             to family practice residency programs, nurse practitioner and  
             physician assistant programs, and registered nurse education  
             programs to increase the number of students and residents  
             receiving education and training in family practice and  
             nursing. 
          
          This bill:
          







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          1) Requires OSHPD to establish a non-profit public benefit  
             corporation to be known as the Foundation, which is required  
             to be governed by a board of trustees consisting of a total  
             of 13 members. 

          2) Requires seven members to be appointed by the Governor, one  
             member appointed by the Speaker of the Assembly, one member  
             by the Senate Committee on Rules, two members of the Medical  
             Board of California (MBC) by the MBC, and two members of the  
             Osteopathic Medical Board of California (OMBC). Permits the  
             board members appointed by the Governor, the Speaker of the  
             Assembly, and the Senate Committee on Rules to include  
             representatives of designated and nondesignated public and  
             private hospitals, community clinics, public and private  
             health insurance providers, the pharmaceutical industry,  
             associations of health care practitioners, and other  
             appropriate members of health or related professions.  
             Specifies terms of appointees.

          3) Permits the OSHPD director, after consultation with the  
             president of the board, to appoint a council of advisers  
             comprised of up to nine members, to advise the director and  
             the board on technical matters and programmatic issues  
             related to the Foundation.

          4) Requires board and council members appointed by the Governor,  
             Assembly, and Senate to serve without compensation, but to be  
             reimbursed for any actual and necessary expenses incurred in  
             connection with their duties as a board or council member.   
             Requires members appointed by the MBC and OMBC to be  
             reimbursed by those entities for any actual and necessary  
             expenses, as specified.

          5) Prohibits any board member from being considered to be  
             engaged in activities inconsistent and incompatible with his  
             or her duties solely as a result of membership on the MBC and  
             OMBC.

          6) Makes the Foundation subject to the Nonprofit Public Benefit  
             Corporation Law, except that if there is a conflict with this  
             bill and that law, this bill prevails.

          7) Requires the Foundation to:








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             a)    Solicit and accept funds from business, industry,  
                Foundations, and other private or public sources for the  
                purpose of establishing and funding new residency  
                positions described in c) below;

             b)    Encourage public and private sector institutions,  
                including hospitals, colleges, universities, community  
                clinics, and other health agencies and organizations to  
                identify and provide locations for the establishment of  
                new residency positions described in c) below.  Requires  
                the Foundation to solicit proposals for medical residency  
                programs and provide OSHPD a copy of all proposals it  
                receives;

             c)    Approve proposals and recommend to OSHPD the  
                establishment of new residency positions upon the  
                sufficient solicitation of funds and at the Foundation's  
                discretion.  Requires a recommendation to include all  
                pertinent information necessary for OSHPD to enter into  
                the necessary contracts to establish the residency  
                positions.  Requires the Foundation to only approve and  
                recommend proposals that would establish residency  
                positions that will serve a service area that is  
                designated as:

                 i)       A primary care shortage area;

                 ii)      A health professional shortage area (HPSA) for  
                   primary care, by either population or geographic  
                   designation by HRSA;

                 iii)     A medically underserved area or medically  
                   underserved population by HRSA.

             d)    Deposit into the Fund necessary moneys are required to  
                establish and fund the residency program, upon approval of  
                a recommendation;

             e)    Recommend to the OSHPD director that a portion of the  
                funds solicited from the private sector be used for the  
                administrative requirements of the Foundation; and

             f)    Prepare and submit an annual report to the Legislature  
                documenting the amount of money solicited, the amount of  







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                money deposited from the Foundation into the Fund, the  
                recommendations for the location and fields of practice of  
                future residency positions, total expenditures for the  
                year, and the prospective fundraising goals.

          8) Requires OSHPD to:

             a)    Provide technical and staff support to the Foundation  
                in meeting all of its responsibilities.

             b)    Provide financial management for the Foundation.

             c)    Approve the recommendation, upon receipt from the  
                Foundation, if it fulfills the requirements of this bill.  
                Requires an approval to signal OSHPD's intent to establish  
                the residency position upon sufficient funds being  
                available.
             d)    Establish a uniform process by which the Foundation may  
                solicit proposals from public and private sector  
                institutions, including hospitals, colleges, universities,  
                community clinics, and other health agencies and  
                organizations that train primary care residents.  

             e)    Require that these proposals contain all necessary and  
                pertinent information, including, but not limited to, the  
                location of the proposed residency position; the medical  
                practice area of the proposed residency position;  
                information that demonstrates the area's need for the  
                proposed residency position and for additional primary  
                care practitioners; 
                amount of funding required to establish and operate the  
                residency position;

             f)    Enter into contracts with public and private sector  
                institutions, including hospitals, colleges, universities,  
                community clinics, and other health agencies and  
                organizations in order to fund and establish residency  
                positions at, or in association with, these institutions. 

             g)    Ensure that the residency position has been, or will  
                be, approved by the Accreditation Council for Graduate  
                Medical Education;

             h)    Provide the following information to the board:







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                  i)       The areas of the state that are deficient in  
                   primary care services;

                  ii)      The areas of the state that have the highest  
                   number of Medi-Cal enrollees and persons eligible to  
                   enroll in Medi-Cal, by proportion of population;

                  iii)     The proposals received from institutions that  
                   train primary care physicians pursuant d) above; and

                  iv)      Other information that OSHPD or the board finds  
                   relevant to assist the board in making its  
                   recommendations on possible locations for new residency  
                   positions.

             i)    Monitor the residencies established pursuant to this  
                chapter; and 

             j)    Prepare and submit an annual report to the Foundation  
                and the Legislature documenting the amount of money  
                contributed to the fund by the Foundation, the amount of  
                money expended from the fund, the purposes of those  
                expenditures, the number and location of residency  
                positions established and funded, and recommendations for  
                the location of future residency positions.

          9) Establishes the Medical Residency Training Fund within the  
             State Treasury, as specified.

          10)Makes the level of expenditure by OSHPD for the  
             administrative support of the Foundation is subject to review  
             and approval annually through the State Budget process.

          11)Permits OSHPD and the Foundation to solicit and accept public  
             and private donations for deposit in the fund, and makes all  
             money in the fund continuously appropriated to OSHPD for the  
             purposes of this chapter. Requires OSHPD to manage this fund  
             prudently in accordance with applicable laws.

          12)Requires any regulations adopted to implement this to be  
             emergency regulations, as specified.

          13)Permits OSHPD to exempt from public disclosure any document  







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             in its possession that pertains to a donation made pursuant  
             to this bill if the donor has requested anonymity.

          Comments
          
          1)Author's statement.  According to the author, California has a  
            critical shortage of primary care physicians. In order to  
            maintain our current rate of utilizations, we must train 8,000  
            more primary care physicians by 2030. Our statewide shortage  
            is further aggravated by misdistribution. Only 16 of  
            California's 58 counties meet the recommended 60-80 primary  
            care physicians per 1,000 people. With an increasing Medi-Cal  
            population, these already underserved areas will see their  
            services stretched even thinner. SB 22 will create a voluntary  
            public-private partnership to fund additional primary care  
            physician residency positions to be placed in these  
            underserved areas of California. By providing a state match of  
            up to $20 million for private contributions, SB 22 creates a  
            fund to provide additional residency positions while allowing  
            a state sanctioned but privately run non-profit organization  
            have a say in the distribution of the positions within these  
            areas. By working closely with private and public  
            stakeholders, this bill aims to create a consensus based  
            solution to meet the need for more doctors in California as  
            access to healthcare continues to grow.


          2)Primary Care in California. California is home to the largest  
            number of primary care physicians and nurse practitioner in  
            the country. However, the state ranks 23rd in the number of  
            primary care physicians per resident.  An August 2014 report  
            by the California HealthCare Foundation states that California  
            has only 35 to 49 primary care physicians per 100,000 Medi-Cal  
            enrollees.  Federal guidelines call for the state to have 60  
            to 80 doctors per 100,000 patients.  The supply of primary  
            care physicians also varies substantially across California's  
            counties.  The number of primary care physicians actively  
            practicing in California counties is, in too many cases, at  
            the bottom range of, or below, the state's need.  According to  
            2011 Health Resources and Services Administration (HRSA) data,  
            29 of California's 58 counties fall at the lower end, or  
            below, the needed supply range for primary care physicians.   
            In other words, half of Californians live in a community where  
            they do not have adequate access to the health care services  







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            they need.  


          3)The Affordable Care Act (ACA).  Under the ACA, about five  
            million Californians have enrolled in either private insurance  
            or Medi-Cal.  There are now 12 million Medi-Cal enrollees,  
            about one third of California's population.  The newly insured  
            will increase demand for health care from an already strained  
            system. Furthermore, the ACA will change how care is  
            delivered. It provides incentives for expanded and improved  
            primary care, which may affect demand for some health care  
            professionals more than others, and encourages the creation of  
            team-based models of service delivery.  Research indicates  
            that health care reform will place higher skill demands on all  
            members of the health care workforce as systems try to improve  
            quality while limiting costs. The scale of change with health  
            care reform is unlike anything that California has previously  
            faced.  Studies have found that persons with health insurance  
            use more health care services than uninsured persons,  
            particularly in primary care and preventive services.  This  
            was found in Massachusetts, which experienced a substantial  
            increase in demand for primary care services as a result of  
            its 2006 health reform.  A February 2, 2015 article in the San  
            Jose Mercury News reported that the primary care physician  
            shortage combined with the millions of newly insured has  
            resulted in significant delays in seeing a doctor and crowded  
            emergency rooms.  According to the Mercury News article, "?  
            many experts say the problems are so widespread they shouldn't  
            be ignored." 


          4)Current workforce development programs. The state currently  
            operates a number of programs designed to increase the number  
            of health care professionals practicing in medically  
            underserved areas:


             a)   HPEF established in 1987 and housed within OSHPD  
               non-profit, HPEF is a non-profit Foundation statutorily  
               created to provide financial incentives to aspiring and  
               practicing health professionals.  HPEF offers six  
               scholarships and seven loan repayment programs in several  
               allied health professions, including nursing, mental  
               health, dentistry, and medicine. Scholarship programs  







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               provide financial assistance to healthcare students who are  
               attending a California accredited college or university and  
               agree to practice in California's underserved communities  
               upon graduation. Loan repayment programs are offered to  
               working health professionals to assist in repayment of  
               their education debt in exchange for a service obligation.   
               Service obligations are typically one to three years, and  
               vary depending on the program and awards range from $4,000  
               to $105,000 depending on profession and length of service  
               obligation. HPEF has increased access to care in the  
               state's underserved areas via 6,693 awards totaling more  
               than $60 million to health practitioner awardees serving in  
               57 of the state's 58 counties.


             b)   California State Loan Repayment Program (SLRP) provides  
               educational loan repayment assistance to primary health  
               care professionals who provide health care services in  
               federally designated HPSAs. Eligible health professionals  
               include physicians specializing in primary care fields,  
               nurse practitioners, certified nurse-midwives, general  
               practice dentists, registered dental hygienists, clinical  
               or counseling psychologists, clinical social workers,  
               licensed counselors, pharmacists, physician assistants,  
               psychiatric nurse specialists, and marriage and family  
               therapists. Eligible health professionals must be employed  
               by or have accepted employment at a SLRP Certified Eligible  
               Site (which includes rural health clinics, community health  
               clinics, county facilities, and federally qualified health  
               centers) and must commit to providing full-time or  
               half-time primary care services in a HPSA for a minimum of  
               two years. Health professionals may receive up to  $50,000  
               in exchange for a two year full-time service obligation  
               and/or $25,000 for a two year half-time service obligation;  
               individuals can receive up to $150,000 over six years at  
               full-time and $75,00 for half-time. SLRP award amounts are  
               matched by the site(s) in which the health professional is  
               practicing, on a dollar-for-dollar basis, in addition to  
               salary. The SLRP is funded through a grant from the HRSA,  
               Bureau of Clinician Recruitment and Service, National  
               Health Service Corps and is administered by OSHPD.


             c)   Song-Brown Program.  The Song-Brown Program was  







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               established to increase the number of family physicians in  
               the state and increase the number of family medicine  
               residency programs. Currently, Song-Brown provides  
               financial support to family medicine and primary care  
               residency (Internal Medicine, OB/GYN and Pediatric)  
               programs, family nurse practitioner programs, primary care  
               physician assistant training programs, and registered nurse  
               education programs.  Funding is provided to institutions  
               that provide clinical training and education in underserved  
               areas, and healthcare to the state's underserved  
               population.


             d)   Mini Grants Program provides grants to organizations  
               supporting underrepresented and economically disadvantaged  
               students in pursuit of careers in health care.  
               Organizations receive grants of up to $15,000 to engage in  
               health career conferences, workshops, and/or career  
               exploration activities. Since 2005, over $2.2 million has  
               been awarded to support organizations engaging in these  
               activities serving nearly 56,000 students statewide. In  
               2014 to2015, via partial funding from Mental Health  
               Services Act Workforce Education and Training, the  
               California Endowment, and the California State Office of  
               Rural Health, OSHPD awarded 46 Mini Grants to organizations  
               for a sum of $603,706. This will help support 16,555  
               students from demographically underrepresented groups to  
               pursue healthcare careers.


             e)   California Student/Resident Experiences and Rotations in  
               Community Health (CalSEARCH) provides grants to  
               organizations that support student and resident rotations  
               from primary care and mental health disciplines in  
               community clinics, health centers, and public mental health  
               system sites which expose students, residents and  
               practitioners to underserved communities. Organizations  
               awarded receive funding to administer the program and to  
               provide students, residents, and preceptors and mentors a  
               small stipend for completing the program. In addition to  
               completing a rotation in an underserved area, participants  
               are also required to complete a community project. From  
               2009 to 2012, 150 students and residents were supported via  
               an American Recovery and Reinvestment Act grant. In 2014  







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               to2015, via funding from the MHSA Workforce Education and  
                                                        Training and The California Endowment, OSHPD granted 12  
               awards to organizations for a sum of $317,000 which will  
               help support 92 participants statewide.


             f)   MHSA Workforce Education and Training (WET) Program  
               funded by Proposition 63, this program remedies the  
               shortage of mental health practitioners in the public  
               mental health system (PMHS) via: career awareness; PMHS  
               rotations; retention grants; stipends; loan repayments;  
               grants to expand capacity of education and residency  
               programs; grants to increase and retain consumer and family  
               member employment; and grants to support regional  
               partnerships.


          Prior Legislation


          SB 1416 (Rubio, 2012) would have created the Graduate Medical  
          Education Trust Fund for the purpose of funding grants to  
          graduate medical education residency programs in California, and  
          would have required OSHPD to develop criteria for distribution  
          of available moneys.  SB 1416 was held in the Assembly  
          Appropriations Committee


          FISCAL EFFECT:   Appropriation:    Yes         Fiscal  
          Com.:YesLocal:   No 

          According to the Senate Appropriations Committee:  

          1)One-time administrative costs of about $1 million to create  
            the foundation and develop criteria for making grants (General  
            Fund). In the long-run, donations may support some or all of  
            the activities of the proposed program. In the near term,  
            however, state funds will likely be needed to create the  
            program. 

          2)Ongoing costs of about $800,000 per year to administer the  
            program, support the Foundation, and review and approve grants  
            and contracts (private funds).








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          3)Unknown costs to make grants to medical residency programs  
            (private funds). The bill would require the Foundation to  
            solicit donations from public and private sources in order to  
            fund new medical residency positions. The amount of funding  
            available under the program will depend on the success of  
            those fundraising efforts.


          SUPPORT:   (Verified6/1/15)


          AARP
          Association of California Healthcare Districts
          California Academy of Physician Assistants
          California Chapter of the American College of Emergency  
          Physicians
          California Physical Therapy Association
          California Primary Care Association
          Community Clinic Association of Los Angeles County


          OPPOSITION:   (Verified6/1/15)


          None received

           

          Prepared by:Melanie Moreno / HEALTH / 
          6/2/15 20:28:34


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