BILL ANALYSIS Ó
SJR 7
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Date of Hearing: June 23, 2015
ASSEMBLY COMMITTEE ON HEALTH
Rob Bonta, Chair
SJR
7 (Pan) - As Amended April 6, 2015
SENATE VOTE: 36-0
SUBJECT: Medical residency programs.
SUMMARY: Urges the U.S. Congress and the President to renew
funding for the Health Resources and Services Administration's
(HRSA's) Teaching Health Center and Primary Care Residency
Expansion Graduate Medical Education (GME) Programs set to
expire this year, and lift the freeze on residency positions
funded by Medicare to expand physician supply and improve access
to health care. Specifically, this resolution:
1)Makes findings and declarations, including all of the
following:
a) According to a 2014 report by the California HealthCare
Foundation (CHCF), out of 105,000 licensed physicians, only
71,000 are actively involved in providing patient care;
b) There are physician shortages in certain regions and
will likely be exacerbated by increases in the number
insured patients and the number of physicians planning to
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retire;
c) Federal funding levels of residency training programs
have been frozen since 1997, while California's population
has increased by more than 10% since that time;
d) California has been able to address only a minimal
portion of primary care physician (PCP) residency programs'
funding shortfall with state funds;
e) Many PCPs, including those who have graduated from
California medical schools, want to train in California,
but are forced to leave the state because of the shortage
in training slots at residency programs;
f) California has the highest retention rate of physicians
who complete their residency training in-state; and,
g) Increasing funding for PCP medical residency training
programs is a critical step in addressing the physician
shortage problem and improving access to medical care.
2)Resolves that the Legislature call upon the U.S. Congress and
President to renew funding for Primary Care Residency
Expansion GME Programs, lift the freeze on residency positions
funded by Medicare, encourage the development of PCP training
programs in ambulatory, community, and medically underserved
sites through new funding methodologies and incentives.
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3)Resolves that the Secretary of the Senate transmit copies of
this resolution to the U. S. President and the Vice President,
Speaker of the House of Representatives, Majority Leader of
the Senate, each Senator and Representative from California in
Congress, and to the author for appropriate distribution.
EXISTING LAW:
1)Establishes, under federal law, HRSA, an agency of the U.S.
Department of Health and Human Services (HHS), as the primary
federal agency for improving access to health care by
strengthening the health care workforce, building healthy
communities, and achieving health equity.
2)Enacts, in federal law, the Patient Protection and Affordable
Care Act (ACA) to, among other things, make statutory changes
to expand access to health care coverage for Americans
including calling for health workforce needs assessment and
action plans, changing Medicare GME to expand training in
primary and ambulatory settings, and reauthorizing existing,
and creating new, scholarship and loan repayment programs.
3)Establishes the California Healthcare Workforce Policy
Commission (Commission) and requires the Commission to, among
other things, identify specific areas of the state whith unmet
needs for PCPs; establish standards for family practice
training programs and family practice residency programs; and
review and make recommendations to the Office of Statewide
Health Planning and Development (OSHPD) concerning the funding
of residency programs.
4)Establishes the Health Professions Education Foundation (HPEF)
within OSHPD. Requires the HPEF to solicit and receive funds
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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.
5)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.
6)Establishes the Song-Brown Health Care Workforce Training Act
of 1973 (Song-Brown Act), 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. The Song-Brown Act also encourages
universities and primary care health professionals to provide
health care in medically underserved areas.
FISCAL EFFECT: None.
COMMENTS:
1)PURPOSE OF THIS RESOLUTION. According to the author, this
resolution calls on the federal government to renew funding
for teaching health centers that is set to expire at the end
of 2015, to lift the freeze on residency positions funded by
Medicare, and calls on the President and Congress to encourage
the development of primary care training programs in
ambulatory, community, and medically underserved sites through
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new funding methodologies and incentives. According to the
California Medical Association (CMA), sponsor of this bill,
GME is the hands-on training phase of physician education that
is mandatory in order for doctors to obtain a license for
independent practice. Although federal, state, and private
funds pay for GME, federal contributions through Medicare
contribute the bulk; about $9.5 billion annually nationwide.
CMA further states that unfortunately, this federal funding
source has been frozen since 1997, despite California's
population having grown by 20% in the same timeframe. While
the ACA included nearly $50 million to expand primary care
residency programs, much of that funding is set to expire at
the end of 2015.
2)BACKGROUND.
a) Graduate Medical Education. GME is a training program
for medical school graduates that serve as residents in
more than 1,000 of the nation's hospitals. GME is funded
by the federal HHS through the Centers for Medicare and
Medicaid Services. According to a 2012 health policy brief
on GME in Health Affairs, overall support for GME comes out
of a number of separate public and private sources. Each
year the federal government contributes about $9.5 billion
in Medicare funds, and approximately $2 billion in Medicaid
to help pay for GME. The federal government also funds GME
in children's hospitals through a program called Teach
Health Centers GME, which trains residents in
community-based ambulatory settings; and through
contributions from other agencies. Additionally, the brief
points out that more than 40 states have paid about $3.78
billion through their Medicaid programs to support GME in
2009. Since then, many states have reduced their support
for advanced medical training.
Medicare supports GME through two separate methodologies when
calculating payments to hospitals: direct payments to pay
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the salaries of the residents and the supervising
physicians' time; and, indirect payments to subsidize other
hospital expenses associated with running training
programs, such as longer inpatient stays and more use of
tests. These payments are based, in part, on the number of
residents a hospital trains and the number of Medicare
patients it treats. Of the estimated $9.5 billion in
Medicare funds spent on GME in 2010, approximately $3
billion went for direct payments and $6.5 billion went for
indirect payments. The indirect medical education
calculations are complicated and controversial. The
Medicare Payment Advisory Commission, a group that advises
Congress, estimates that indirect payment levels may be
$3.5 billion higher than actual indirect costs.
b) GME and the ACA. On March 23, 2010, President Obama
signed the ACA (Public Law (PL) 111-148), as amended by the
Health Care and Education Reconciliation Act of 2010 (PL
111-152). Specifically, the ACA increases the number of
GME training positions by redistributing currently unused
slots, with priorities given to primary care and general
surgery and to states with the lowest resident
physician-to-population ratios (effective July 1, 2011);
increases flexibility in laws and regulations that govern
GME funding to promote training in outpatient settings
(effective July 1, 2010); and, ensures the availability of
residency programs in rural and underserved areas.
c) The ACA and Physician Shortages. 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 by providing incentives for expanded
and improved primary care. Research indicates that health
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care reform will place higher skill demands on all members
of the health care workforce as systems try to improve
quality while limiting costs. Studies have found that
persons with health insurance use more health care services
than uninsured persons, particularly in primary care and
preventive services. 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."
d) Primary Care in California. California is home to the
largest number of primary care physicians and nurse
practitioners 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
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 may not have adequate access to the
health care services they need.
e) 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:
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i) Health Professions Education Foundation established
in 1987 and housed within OSHPD, 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 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. 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.
ii) California State Loan Repayment Program (SLRP)
provides educational loan repayment assistance to primary
health care professionals who provide health care
services in federally designated Health Professional
Shortage Areas (HPSAs). Eligible health professionals
include physicians specializing in primary care fields.
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 and is
administered by OSHPD.
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iii) Song-Brown Program was established in 1973 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.
iv) 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 to 2015, via partial funding
from Mental Health Services Act (MHSA) Workforce
Education and Training, the California Endowment, and the
California State Office of Rural Health, OSHPD awarded 46
grants from the Mini Grants Program to organizations for
a sum of $603,706.
v) California Student/Resident Experiences and
Rotations in Community Health 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
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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 to 2015, 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.
3)SUPPORT. CMA states in support of this resolution, our state
has a trove of PCPs who want to train here, including those
who have graduated from California medical schools, but who
are forced to leave the state because training slots at
medical residency programs are limited. This is despite the
fact that 40% of California's counties fail to meet the
recommended ratio of PCPs and likely will face a shortage as
the number of insured individuals grows and physicians retire.
CMA concludes this resolution calls on the federal government
to renew funding for teaching health centers that is set to
expire at the end of 2015, to lift the freeze on residency
positions funding by Medicare, and would call on the President
and Congress to encourage the development of primary care
training programs in ambulatory, community, and medically
underserved sites through new funding methodologies and
incentives. The Medical Board of California, also writes in
support that this resolution may help more physicians to
receive residency training positions in California and help
with those trained in California to end up practicing in
California. This resolution is in line with MBC's mission of
promoting access and care.
4)RELATED LEGISLATION. SB 22 (Roth) requires OSHPD to establish
a non-profit public benefit corporation to be known as the
California Medical Residency Training Foundation, as
specified. SB 22 is currently on the Senate inactive file.
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5)PREVIOUS LEGISLATION.
a) AB 2458 (Bonilla) of 2014 would have established the
Graduate Medical Education Fund (Fund) to administer and
fund grants to GME residency programs and would have
appropriated $25 million to the Fund from the General Fund
in fiscal year 2014-15 and $2.84 million to the Fund per
year for three years from the California Health Data and
Planning Fund commencing with the 2014-15 fiscal year. AB
2458 was held on the Assembly Appropriations Committee
Suspense File.
b) AB 1176 (Bocanegra and Bonta) of 2014 would have
established the Medical Residency Training Program to fund
GME residency programs in California and would have
required every health insurer or health plan that provides
health care coverage in this state to pay an annual GME
assessment of $5.00 for each covered life. AB 1176 was
held under submission in the Assembly Appropriations
Committee.
c) SB 1416 (Rubio and Ed Hernandez) of 2012 would have
created the GME 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.
d) AJR 13 (Lara), Resolution Chapter 85, Statutes of 2011,
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urges the President and Congress to continue to provide
resources to increase the supply of physicians in
California, in order to improve access to care,
particularly for Californians in rural areas and members of
underrepresented ethnic groups, and to consider solutions
that would increase the number of graduate medical
education residency positions to keep pace with the growing
numbers of medical school graduates, and the growing need
for physicians in California.
REGISTERED SUPPORT / OPPOSITION:
Support
California Medical Association (sponsor)
California Primary Care Association (sponsor)
American Federation of State, County and Municipal Employees,
AFL-CIO
Medical Board of California
Opposition
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None on file.
Analysis Prepared by:Patty Rodgers / HEALTH / (916)
319-2097