SENATE BILL REPORT

SB 5182

BYSenators Barr, Owen, Conner, Metcalf, Sellar, Vognild, Benitz, Bauer, Anderson, West and Kreidler

Establishing a loan forgiveness program for rural health professionals.

Senate Committee on Health Care & Corrections

Senate Hearing Date(s):January 26, 1989; February 2, 1989

Majority Report:  That Substitute Senate Bill No. 5182 be substituted therefor, and the substitute bill do pass and be referred to Committee on Ways & Means.

      Signed by Senators West, Chairman; Smith, Vice Chairman; Amondson, Johnson, Niemi.

Senate Staff:Scott Plack (786-7409)

                  February 3, 1989

Senate Committee on Ways & Means

Senate Hearing Date(s):March 2, 1989; March 3, 1989

Majority Report:  That Second Substitute Senate Bill No. 5182 be substituted therefor, and the second substitute bill do pass.

      Signed by Senators McDonald, Chairman; Craswell, Vice Chairman; Amondson, Bailey, Bluechel, Cantu, Gaspard, Hayner, Johnson, Lee, Matson, Moore, Newhouse, Niemi, Owen, Saling, Smith, Talmadge, Warnke, Wojahn.

Senate Staff:W. Featherstone Reid (786-7715)

                  March 13, 1989

AS REPORTED BY COMMITTEE ON WAYS & MEANS, MARCH 3, 1989

BACKGROUND:

While there is a shortage of primary care physicians, nurses and physician assistants in rural areas of the state, there is a surplus of some of these health professionals in urban areas.  One major reason for the shortage is the inability of rural communities to pay competitive salaries.  The high cost to acquire training means most providers enter their profession with substantial education related debts.  The average educational debt for a physician is currently about $100,000.

In its report to the Legislature, the Washington Rural Health Care Commission recommended that the Legislature establish a loan forgiveness program as a means of attracting physicians, nurses and dentists to rural areas.  Limited federal matching dollars could be available to the state if the program meets federal guidelines.

SUMMARY:

The health professional loan repayment program is established and designed to meet federal guidelines for matching funds.  The Higher Education Coordinating Board is directed to implement the program.  Student loan repayment is available to physicians, nurses and dentists who serve in a federally designated health professional shortage areas.  The maximum amount available is up to $15,000 for five years and payments begin upon service in a shortage area.

Participants must serve at least three years in a shortage area or face repaying twice the amount paid on their behalf.  Participants must agree not to discriminate against Medicaid or Medicare patients and must accept Medicaid assignment. Payments to participants cease after five years or when the participant terminates service in a shortage area. 

EFFECT OF PROPOSED SUBSTITUTE:

Physician assistants are added to the list of providers eligible to participate in the program.  The board is granted authority to modify penalty provisions for participants who terminate before three years when extraordinary circumstances exist.  An appropriation of $150,000 is added to be used for providing loan repayments to participants.

EFFECT OF PROPOSED SECOND SUBSTITUTE:

The appropriation of $150,000 is removed and any funding level is left to the eventual passage of both this measure and the operating budget for the next biennium.

Appropriation:    none

Revenue:    none

Fiscal Note:      available

Senate Committee - Testified: HEALTH CARE & CORRECTIONS:  FOR:  Steven Meltzer, Eastern Washington Area Health Education Center; Dr. John Anderson; Dr. Stephen Kriebel, WSMA; Verne Gibbs, DSHS; Eldon E. Jacobsen, SHCC; Thomas Trompeter, Washington State Primary Care Association; Tom Martin, Lincoln Hospital District; Patty Joynes, WSNA

Senate Committee - Testified: WAYS & MEANS: Senator Scott Barr, prime sponsor; Sharon Case, Washington State Primary Care Association; Representative Steve Furhman; Charlotte Hardt, Ritzville Memorial Hospital; Jeff Mero, Washington State Hospital Association; Jackie L. McFayden, Washington State Association of Counties; Dan Rubin, Department of Social and Health Services; Gail Toraason, Washington State Nurses Association; Ron Wagner, Washington State Medical Association; Senator James West