Assembly Budget Subcommittee No. 1 on Health, Monday, February 23, 2026
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Assembly Budget Subcommittee No. 1 on Health California State Assembly
Follow its sittingsSpeaker 1
And I do wanna say thank you to the LAO for their partnership. I asked some questions not too long ago, and they were able to turn around a couple of reports very, very quickly. So I wanna say thank you for the work that you did to get ready. Also, to the University of California and HCAI who've been responsive. We've asked for a lot of data over the course of preparing for this hearing, including what I think is super important or very, very important, which is county level data so that we can see are California's programs working, and if so, for whom are they working?
Because I have the distinct experience that the programs we have in place have yet to work for the breadth of Californians. They do work for some Californians, but not for all Californians. So we will have time to dig into all of that. Before I jump in, I'll open it up to either member who's here if you want to make any opening comments. And if not, we'll bring we'll get started on our panels.
Okay. Perfect. With that, let's see. The agenda and the LAO handouts are available online on our committee's website, and physical copies are available in the hearing room if anybody needs one. We've also made the county level data available online.
After we conclude a panel presentation on each issue, we will take questions from members and then comments from the public. The public comments will be taken in person at the end of each of the issues. So we'll do panel one, questions from members, public comments, then go to panel two and repeat that order. If there's a lot of people here, if you could keep your comments to a minute or less, we look like we have a manageable audience for public comments, so you should be able to say the things that you were hoping to say. But if you were not able to attend, you can submit your comments via email at asmbudget@asm.ca.gov.
So with that, we will start with issue one, which is HR one and impact on medical student loans and the overview of state student loan repayment programs. And for this panel, we have representatives from the LAO, excuse me, the Department of Health Care Access and Information, the University of California, and the Department of Finance.
Speaker 3
And we're gonna be talking about a broad overview of HR one, its impact on medical student loans, and then an overview of the state student loan repayment programs that support physicians.
Speaker 1
And so with that, we'll start with the LAO and then move to each of the panelists. The LAO is going to provide an overview of the impact of HR1 on access to medical school as well as student debt. And for this segment, LAO has prepared the handout that I mentioned for you in their presentation. And I'll just ask each of you if you can introduce yourselves as you get started, and we'll go from LAO to HKai and then an introduction of some of the two of the doctors that we have here with us. So I'll turn it over to the LEO to get started.
Thank you.
Speaker 4
LEO. So in my remarks today, I'll be summarizing the changes that HR1 is introducing to the federal student loan policy and discuss what that could mean for access to medical school and for student loans in California. And I'll be referring to the handout that has
Speaker 4
distributed in my comments. And the main takeaway of my summary will be that those new rules will affect mostly who can afford to enroll in the California Medical School more than the actual number of students who end up enrolling. So I'm information to explain why student debt has become an issue. So on page one, we are reviewing some of the recent data on the cost of attendance of to medical school. And focusing first on tuition and fees, those range from around $40,000 at UC campuses to $75,000 at some of the private institution.
But it's important to remember that tuition and fees only account for half of the cost of attendance. And for UC campuses, the total cost of attendance, as you see in the data, usually amount to around $80,000 And for some of the private institutions, we go all the way up to over $100,000 And so it's as a result of those high cost of attendance that students have to resolve to different means to finance their education. So as we explained on Page two of the handout, students typically use a mix of grant or scholarship, loans and also use their own financial means to cover the rest of their cost of attendance. So I'm going to use some of UC data for this part of the presentation because it's a bit more publicly available. So among UC students, the vast majority do receive some form of scholarship of grants, 87% of them.
And the average award is slightly over $36,000 which means that they have usually to use loans to cover the rest of their expenses. And in the case of UC, it's more than half of the students who rely on loans. On an annual basis, they tend to borrow around $47,000 And there's different types of loans that they can rely on. Most students are going to use federal direct subsidized loans provided by the government. And because those have a cap right now, even before HR1 new provisions, a subgroup of the students in California will rely on another program that was started in 2006 that's called the Grad PLUS program that allow the students to cover the entire cost of attendance.
So again, in the UC, it's 20% of the students who borrow through that additional channel. And currently, private loans are very limitedly used by students in California. When we're looking at the debt of students by the time they graduate, private loans only account for less than a percent of that debt. So the issue here is that students, because they rely a lot on borrowing to cover their the cost of their education, tend to accumulate substantial amount of debt, which is what we described on Page three of the handout. So nationally, the average level of education debt for medical student is around $220,000 It's a bit it's slightly less for UC students.
Right now, the average is around $150,000 And but we do have that while twothree of UC students graduate with some debt, There is a substantial number. It's roughly one out of five medical students at UCs who graduate with more than $200,000 And it's for that group of students with a high level of debt that the new provision introduced by HR1 will make financing their medical education more challenging. So if I'm now turning to those provision in HR1, which we summarize on Page four of the handout. As Chair Addis mentioned, they're going to become effective on 07/01/2026. And I'll just emphasize three main provisions that will impact more directly the medical students.
The first one is new direct loan caps. There's a new annual cap at $50,000 for medical students and other professional programs and a new program cap for the entire length of their medical education, which will be set at $200,000 There's also a new lifetime debt cap that will be introduced, and that cap includes both undergraduate and graduate debt. And it's currently set at $257,500 And what's important to note for this cap is that it's not adjusted for inflation, which means that over time, as cost of living and the tuitions are rising, those caps are going to become more binding for some group of students. And finally, the other critical aspect of the new law that will be, I think, problematic for medical students is the elimination of the Grad PLUS program for new borrowers. So if students are already borrowing through the program, they'll be able to access this line of funding until they graduate.
But for new students, that options will no longer be available, which means that students are going to have to find a new way of financing the rest of their education. And so on Page five of the handout, we explain that the impact of those new provisions on students will depend significantly on the extent to which students rely on loans to finance their education. And because earlier research has suggested that the GradPost program had had a significant impact on how much students were relying on private loans, by eliminating the GradPost program, students will have to rely more heavily on the private loan option. And it could become problematic because, first, those private loans tend to have stricter underwriting. They also, for students who have lower credit score, they could entail much And higher interest they provide fewer protections and fewer flexibility when it comes to the repayment.
So those type of private loans right now do not offer the typical income driven repayment scheme that we observe with the federal loans. So with that in mind and understanding that those provisions have not come into effect yet, there's still uncertainty in terms of exactly how those provisions will affect students, but we know that in the long run, they're likely to have some impact on students' behaviour. For example, as I said in my introduction, students who come from low income households who are who tend to rely more on loans to finance their education and who are more likely to not be able to find a cost of debt for a loan might have a difficulty using the private loan alternative to cover the cost of their education. So it's likely that people from low income households might be deterred from applying for medical school. Some reports from the Association of American Medical Colleges has also found that when they surveyed their graduates from medical school, a substantial number of the respondent indicated that their education debt had an impact on their specialty choice.
So it was around 20% of those. And for students who come from low income households or who have over $250,000 in debt, that percentage who take into account education debt in their specialty choice jumped to thirty five percent. It's also likely that graduates might change their decision in terms of where they want to practice based on, again, the level of debt they accumulate, and they might decide to move towards higher paying regions. There's another report from that AMC Association that find that students who have higher debt level are less likely to look into underserved areas as their practice destination. So to conclude, I want to emphasize that HR1 is really changing the financing tools that students will rely on to cover their full cost of attendance.
And at this point, our office estimate that the main policy concern may be access to medical education and the composition of the student population rather than a dramatic decrease in the number of medical students that will actually complete the program. Thank you, and happy to answer any questions.
Speaker 5
Thank you very much. And Thank good afternoon. My name is Libby Abbott, and I am the Deputy Director for Health Workforce Development at HCAI. I will share about three of our loan repayment programs that are available to physicians. Loan repayment programs are used by HCAI primarily to attract and retain health workers in specific settings.
By offering loan repayment in exchange for a service obligation in an underserved setting, we can help expand workforce availability in those settings in the short term for the period of the service obligation, and we improve the chances of retaining health workers in those same settings in the long term. The theory of change for how we do that is threefold. Loan repayment reduces the impact of financial considerations on their job choices, as the LAO just described. It exposes them to the rewards of serving in underserved settings. And the theory goes that if they haven't already, awardees will put down roots and build local connections that will outlast their service obligations.
So I'll start by describing the California State Loan Repayment Program, SLRP, which is California's National Health Service Corps Loan Repayment Program. It aims to increase the number of providers practicing in federally designated health profession shortage areas, or HIPSAs. The program is open to a number of health professions types for physicians specifically. That includes family medicine physicians, internal medicine physicians, OBGYNs, pediatricians, psychiatrists, and gerontologists. Core funding for this program includes a $1,000,000 award that we typically receive from the Health Resources and Services Administration, or HRSA, federal entity, as well as $333,000 allocated from the Song Brown General Fund.
Historically, we have supplemented this amount with other sources, such as funding for geriatric care workforce programs or the Children and Youth Behavioral Health Initiative, CYBHI. And in such cases, we've modified our scoring criteria accordingly. We have expended all of those special sources. Grantees may receive up to $50,000 in educational loan repayment grants in exchange for a two year service obligation. The program has historically required a dollar to dollar match by employers.
I think it's worth noting that the requirement was suspended under the American Rescue Plan Act for fiscal years 2223, 2324, and 2425. We are resuming the match requirement, or I should say the the match requirement is resuming in the next program cycle. I would note that we do not we do actually have post service retention data for the state loan repayment program from the National Health Service Corp portal. So it's not our own portal, but we have access to those data. And we were only able to share these with the committee after the agenda was posted, so I apologize for that.
But I'll voice over some of the key findings. Overall, we have data from nine zero one alumni from the years 2019 to 2026, and they do show high retention rates of SLRP awardees in underserved settings. So at the end of a of their service obligations, a 100% of awardees are located in a HPSA, which makes sense. Within twelve months, that number reduces to 43%, and by seven years post completion, that number is 35%, so 35% in HIPSAs specifically. However, if we broaden the definition of success to include not just HIPSAs but any safety net setting, the data are more encouraging, suggesting that the mechanism is successful in supporting awardees to build connection and commitment to working with underserved communities.
So one year after service completion, seventy four percent are retained in either a HIPSA or a Safety Net setting, and by seven years, that number is still high at seventy two percent. By seven years post completion, eighty four percent are still in California. I would also note that we do have plans for more robust evaluation of both our loan repayment and graduate medical education programs, which I'd be happy to share more about subsequently. For now, though, I'll continue describing the programs. The Stephen M.
Thompson Physician Core Loan Repayment Program, or STLRP, aims to increase the number of physicians and surgeons serving in medically underserved areas in California. The program is funded through a $25 surcharge from renewal and licensure fees collected by the Department of Consumer Affairs for allopathic physicians in California. Although our core funding for this program is indicated in the budget at roughly $1,000,000 per year, we have in the past supplemented with additional funds from licensure fees as well as other sources such as geriatric care workforce programs, CYBHI, and others, as I described for the state loan repayment program. As is the case with state loan repayment, when we use those special funds, we will earmark the specific funds and award scoring and selection are then modified to meet the policy intent of that particular source. This program is open to family medicine physicians, obstetricians and gynecologists, pediatricians, internal medicine physicians, emergency medicine physicians, psychiatrists, gerontologists, and surgeons.
80% of the program funds must be used for primary care providers, so that's family medicine, OBGYN, internal medicine, and pediatrics, whereas the remaining 20% can be used for the other specialties that I listed. Eligible physicians may receive an award up to $105,000 in exchange for a three year service agreement. To be eligible, physicians must provide at least thirty two hours of direct patient care per week in one of a list of qualifying facility types. That includes it's a long list federally qualified health centers, rural health clinics, primary care, or mental health profession shortage areas, and others. All eligible sites must serve at least 50% Medi Cal and uninsured populations.
Finally, I'll describe the County Medical Services Program loan repayment program. The County Medical Services Program is a collaborative of 35 counties providing health services for uninsured indigent adults that are not otherwise eligible for other publicly funded health care programs like Medi Cal. The CMS P Loan Repayment Program assists with the repayment of qualified educational loans for health care professionals who provide primary care or dental services at an approved site located in one of the 35 CMSP counties. For physicians, this program is open to family medicine, internal medicine, OBGYN, and pediatrics. Per our revised agreement executed between CMSP and HCAI in 2025, we receive an annual amount up to $1,710,000 from CMSP to fund this program.
Grantees may receive up to $50,000 educational loan repayment in exchange for a two year service obligation. We have learned that the CMSP governing board recently approved completing the current scholarship and loan repayment rounds with HCAI but not funding further rounds. Finally, I'll just note that we do currently have a fourth and time limited loan repayment program that is open to psychiatrists, addiction medicine physicians through BH Connect, the Medicaid waiver from CMS negotiated through DHCS. If you're interested, I'd be happy to share more about that program and its current status as well.
Speaker 1
Thank you so much. I will have a couple of questions when we finish up just about some of the figures that you mentioned. But now we're going to get some additional perspectives both from and I apologize. I'm probably going to butcher both of your names. Doctor.
Sunita Mutha, director of the Health Health Force Center at UCSF, and doctor Grant Hartzog from the University of California, Cruz. So we'll start with, you, doctor Mutha, and then go to heart doctor Hartzog about just what this is looking like in your day to day work and the programs you're working on.
Speaker 3
Great. Thank you. Pleasure to be here. I'm Sunita Mutha. I am a practicing primary care physician trained in internal medicine.
So part of my work currently involves working with trainees, with residents, as well as delivering primary care. I represent the University of California. I'm a professor of medicine at, UC San Francisco and director for Health Force Center, which is very committed to the set of issues we're talking about here. I will say this is a massive issue. It comes up in every part of conversation, whether it is the decision to go to medical school.
And we are in California, I think we all know, we have fewer medical students per population than we do in other states. So that is we have 23 medical students per 100,000, versus nationally 41. So we already start out with a smaller population. And for, when they go on to training, that that that differential con continues. What we can say is the the issues around the affordability of education is primary even in state supported public schools.
The, the decision about how to pay, who which family member, if any, can support the ability to pay, there is absolute differential based on socioeconomic status, race, ethnicity, other characteristics that change what the capital is, if you will, that a family has to be able to use to pay for medical school. And for our residents, they're extremely sensitive to cost. In San Francisco, we live in a high cost region because what what we're talking about is not just educational debt. We are talking about the cost of living and the other indirect expenses that come with education, with medical education training. And they are very sensitive to location of where they'll go for training purposes as well as the I work with internal medicine trainees who have the potential to go into primary care, as I did, but most won't because some of that is really determined by cost and affordability and the ability to pay back on educational debt.
I will say the the other things I think to to call out is there are some high points in our state that we should be proud of that when we do produce trainees, when we produce medical students, when we produce residents, they stay. More California medical students stay in our state than they do in other states. And if you have gone to your your if you completed medical school in California and completed residency in California, the likelihood that you will stay in the state is over 80%. So the investment really does yield a value, but it is a long investment. I'm gonna cede the floor to you for
Speaker 6
Thank you, Chair Addison members. I'm Grant Hartzog. I'm a professor of molecular biology at UC Santa Cruz. And I'm the regional director of our new Prime Central Coast program, which I'll explain to you in a moment. So I think you're all well aware that California's rural and agricultural regions, in particular, suffer a shortage of health care providers.
On the Central Coast we're about 20% below the statewide average of health care providers relative to the population. Furthermore, we know that about 25% of California physicians are 65 years or older, so we're facing retirement crisis. And finally, in these agricultural regions which are heavily Hispanic, we have few Hispanic physicians. And we know that cultural concordance plays a big role in healthcare outcomes. So about 8% of active licensed physicians in California, or a little less than that, are Hispanic, whereas 39% of our state population is Hispanic.
Despite our rural setting, the Central Coast is one of the most expensive housing markets in the nation. And physician salaries on the Central Coast are actually lower than they are in Silicon Valley or the Bay Area or Los Angeles. So a typical scenario that we see on the Central Coast is that a physician will come, they'll practice for a couple of years, and then they'll leave for a higher salary job in Silicon Valley or elsewhere. So we have a tough time holding on to practitioners on the Central Coast. And on a personal note, after the third pediatrician in a row left Santa Cruz, I put my son into a concierge medical practice for exactly the reason she's done.
So to address these problems, in collaboration with UC Davis, UC Santa Cruz is setting up a prime program, program in medical education to really focus on producing providers for the Central Coast. We're seeking to identify and support and recruit kids who come from the Central Coast. They would spend two years at the UC Davis School of Medicine and then return to the Central Coast for their clinical training in their third and fourth year. And our idea here is that we're going to introduce those students to the health care needs and challenges of the Central Coast, to the local medical community, to our two local family practice residency programs in the regions and to really support them and hopefully retain them in the region. This grow your own approach is being used elsewhere in the state, in the nation.
So for example, UC Davis has its tribal health prime program in the North State. UCSF is working in Merced in Fresno for their San Joaquin Valley prime program as well. I want to come back to one point that Doctor. Mutha made is that a significant fraction of Californians who go to medical school go out of state because there aren't enough slots in California. Those people who are going out of state are going to be primarily going to private institutions and paying more.
So they are going to be particularly affected by the impacts of HR one. The people that we're trying to recruit into the prime Central Coast, into the tribal health prime, into the San Joaquin Valley prime programs, those are all people who tend to be first generation people who are coming from poor families. So these are the people who are going to be affected by the impacts of HR one. And it's the legislative analyst office has pointed out, and as you pointed out, chair Addis, the likely outcome of HR one is that we're gonna have a bunch of rich people who wanna go back to San Francisco, who wanna go back to Los Angeles. In the underserved regions of the state will only become more so.
Thank you.
Speaker 1
Thank you so much for for making the track from Bay Area and Santa Cruz area and and sharing your experiences with us. We're going to move to questions from members on the dais. I have a number of questions, and then I'll open it up to members of the committee. But I think, Doctor. Munta, you mentioned there's 23 med students per 100,000 population compared to in the 40s nationwide.
Do we 41 nationwide? Do we have a sense of why that is? Is it about the cost that you just explained or are there factors? There are multiple factors. I think that it has to do
Speaker 3
with how few schools we've had. It's been a large portion of it. We've had a big increase in recent years with the opening of several new medical schools. But relative to our population, we just don't have the kind of capacity that a New York State or other institution does, to be able to take all of those who are interested in that profession and give them the opportunity to do it.
Speaker 1
And I've heard and this is for anybody on the panel, really I've heard that where a doctor does their residency is potentially the single biggest factor of if they will stay in the community and practice medicine. Is that kind of the general sense of
Speaker 3
It is. And the color I would add to that is the more rural exposure you have, the greater your chances that you'll actually stay in a rural setting for
Speaker 3
it's not just geography. It's the kind of experience that you have during that training, so that residency experience.
Speaker 2
Please. Jason Constantaro, Saleo. I would offer a bit more of a nuanced perspective to add on to the to the points here, which is that I'm not as familiar with, you know, perhaps there is data on, where residents end up in terms of communities and regions. I I'm not aware of that data. We do have better data where where folks stay national or state statewide, and we know that as sort of indicated over 80 of of California residents stay in the state.
And there is a bit of a a question about where you know, how do you best, get people to stay in a community? And you have a couple of different approaches, which are which you're hearing in this hearing. You know, there's the, you know, you talked about loan repayments. That that sort of focuses on the on the back end. You know, it and it it's very directly related to going to a specific region because it's their commitment is is tied to that.
On the front end is recruitment, and that's really what the UC prime program really tries to get at. That's a different theory of change. That that focuses on getting people from those regions into the pipeline on the basis that they might return back and be more likely. And then there's residency programs too, which are sort of in the middle. And it's really hard to gauge which of those are the are the most effective.
They're they they have different sort of arguments why some might be more effective in terms of getting at the regional issue, but there there hasn't been a lot of, sort of system wide analysis on kind of the effects of all of these different strategies. So it is it is a bit hard to know, what the biggest factor is among those three.
Speaker 1
That's helpful. And, not to put you on the spot, but I'd love to see that report, in the future when you said there hasn't been a system wide analysis. I'd love I'd love to get my hands on such a system wide analysis, in the future.
Speaker 2
I did wanna note that the the the California, Health Care Foundation did do, kind of a literature review on this a while back. So there is I I maybe over stated when I said there were no resources, but it is hard to Yeah. It is hard to
Speaker 2
really hard to sort of assess all the data and sort of figure out what what's the most effective strategy. No.
Speaker 1
It it it makes sense what you're saying. I did wanna ask I think it was HKai, you you mentioned a a handful of numbers. And I was gonna ask if you could repeat some of that numbers that you said. I'm trying to find them in my notes just around percentages that stay in California.
Speaker 5
Absolutely. I'm I'm happy to share the state loan repayment retention data. Maybe that's what you're thinking of.
Speaker 5
So so we have a number of different outcomes from that state and loan repayment program, including how many stay in California, but also how many stay in health profession shortage areas and how many stay in safety net settings. So looking specifically at health profession shortage areas, some of the data points and we'd be happy to share this as a follow-up too, so you can have the data Sure. In front of
Speaker 1
you may have shared it in a handout, but it's helpful helpful for those that are listening and watching and for me to just hear it one more time.
Speaker 5
Of course. So looking at the outcome of how many stay in a health profession shortage area, within twelve months, we have forty three percent of folks remaining in a health profession shortage area. By seven years post completion, that number is thirty five percent. So there's a drop off, but not huge. However, if we change the outcome we're looking at, and we're looking at how many stay not just in a HPSA, a health profession shortage area, but how many stay in a HPSA or a safety net setting, And then the numbers look pretty good.
So one year after service completion, seventy four percent are in either a HPSA or a safety net setting. And by seven years, that number is seventy two percent, so pretty much sticks. That was just I talked about sort of the theory of change of what makes a loan repayment work, that the piece about, establishing that connection and commitment to working with underserved populations in an underserved settings seems to be working. And then finally, seven years post completion, eighty four percent of those folks were in California.
Speaker 1
So it sounds like the loan, the requirements of the loan repayment to the point are a a piece of, what's creating success in terms of getting and keeping doctors here locally. Last question, and I'm gonna open it up to the dais for colleagues that may not be aware or the public may not be aware. And, doctor Herzog, I know you know about concierge programs, but if any of you could just give a little contour to what is a concierge program because a lot of people are used to I have health insurance. I go to that doctor. They take my health insurance.
But on the Central Coast, in particular, we've had this huge proliferation of concierge and doctors leaving the system, which is really creating depletion within our ranks of people who will take insurance.
Speaker 3
I'm happy to give an overview of how they typically work. There are different levers of why people do it. But typically, a concierge physician, when they do that, charges a fee to join that practice. That's an annual fee. It can range in the amount.
And in the and oftentimes, your insure they do not bill insurance. So you're paying separately. You can choose to submit it as a patient if you would like to, but the what allow what that allows the concierge practice to do is they severely limit the number of patients they see. So a typical concierge practice would be 300 patients for primary care type of work. A more typical number that's used for primary care for a panel size is closer to 2,000.
So you can see the the the drop. The advantage that the patient gets is someone to really what we would all want, someone to walk them through every aspect of that health care journey, specialty conversations, appropriate referrals, the follow through, interpretation of results, which are otherwise more difficult to do. And there's definitely been a growth. What it allows the clinician to do is it allows work life to be much more balanced. You can limit the number of patients.
You are available at all times to that panel, but the data, I think, enable people to make a decision about whether it's feasible to do, to have a panel of 300 that you can manage even with 20 fourseven availability. So it's much more doable. But that's an overview.
Speaker 1
And to tie it back to our general topic around med school loans and how that plays in, are you seeing any correlation around who's who's going in you know, who ends up going into concierge and being pulled out of the regular position.
Speaker 3
I don't have a direct correlation of that information. The cons a typical concierge practice someone who goes into concierge practice has been practicing for a few years.
Speaker 3
So they are not brand new trainees who have left. They are often people who've been working five, ten, or more years and are looking for a more sustainable career option.
Speaker 1
That's it. I'll turn to assembly member Patterson. And then if any other members have questions, then we'll go to public comment.
Speaker 7
Great. Thank you. You know, you know, just pick off on the last line of questioning regarding concierge because that's where it ended and just easier to start there. But is there any kind of tracking or anything like that on who's leaving maybe, you know, a medical group or something like that to go to a concierge service?
Speaker 6
Anecdotally, it's people who are burning out and getting fed up with dealing with panels of 2,000 patients and with all of the bureaucratic work that goes on in their practices. That's the people I know. Who are doing.
Speaker 7
Yeah. It seems to be consistent with, you know, what I'm hearing as well, you know, from the from my friends who are doctors as well as, you know, people that I meet with in my district. So these issues, in terms of people moving to that, which I think concierge care is great. And I I do see a lot of hospital systems sort of trying to sort of break into that a little bit, you know, which which will be interesting. But so this this seems like somewhat of of a systemic issue that's been going on for a while.
Okay. And in terms of the impact on students or medical schools and people going into the profession in the first place, how does California's cost of medical school compare to, you know, maybe other states?
Speaker 6
Yeah. The UC system is one of the best deals out there for sure. So for public education, the UC system delivers high value for an amazing price. The private schools are more expensive. Some of those schools have large endowments where they can provide a lot of support, like Stanford.
Others, not so much. And then we have our osteopathic schools of medicine, which also tend to be fairly expensive. And those numbers are in the LAO document as well.
Speaker 7
Great. Well, perfect transition of me asking the LAO. In terms of, you know, the the medical school the UC systems, which I do routinely here, you know, on on so many levels. I mean, whether it's, you know, become a becoming a lawyer, you know, whatnot, just the the value in terms of, obviously, what you get. Heavily subsidized by taxpayers, might I add, an investment that I think, you know, we're making into that.
But just do we generally know how many out of state students are part of our medical schools and how many are in state? Do we do we generally know that? Or would the number be available somewhere?
Speaker 2
Oh, yeah. We we don't have that information. It would it would be available. The the only tricky thing is, for, US citizens who are nonresidents, they typically gain residency, after the first year of study. Yeah.
So that resident count includes people who who maybe came from out of state initially and then gained residency just from living in the state.
Speaker 7
one year medical school, basically, and then maybe become a resident or when once your residency
Speaker 2
And and there is a lot there is again, it's, as was sort of noted previously, it is a little difficult to track because a lot of, a lot of medical students a lot of students who, so I guess we're talking about medical school. Yeah. Sorry. I was I was getting ahead of myself. But yeah.
Yeah. That that data is available. We could we could circle back with you on the on the breakout.
Speaker 7
Okay. Yeah. And then the cost is more expensive, I assume, for out of state at UCs or than it is in state tuition? Although, as mentioned, it might change after a year of school or or residency.
Speaker 4
So if I'm, you know, looking at some of the UC campuses, and I'm looking at the total cost of attendance, the difference is usually around $13,000 for nonresident students.
Speaker 7
Yeah. Does the UC or the state somehow track the number of out of state students who actually stay in the state after medical school? If you don't know, that's fine. I can ask, you know
Speaker 3
I think we know the percentage that stay for residency training. And I know we'll talk about that next. But it is I think it's about half stay in state. I'll I'll have to confirm those numbers with you afterwards. Stay to continue their training.
But I think your specific question is, like, what percentage of those graduates are
Speaker 7
Well, yeah. You know, I mean, you know, just as a public policy, I mean Yeah. My guess is I'm just as you know, maybe nobody agrees with me in this building, which is very common, here and at home, is is, you know, we bring in students from out of state. We're investing in them, taxpayers are, and then they leave, you know, go back maybe to their home or something. And so that's just an interesting would be interesting to know.
I guess, you know, we may not have the answers for that right this second. And I I don't know if that's a good or bad thing at this point. I'm just sort of would be interested in that information, you know, in the age of very limited dollars. But, you know, I I guess, you know, it seems like the the crux of the issue that that we're talking about here, which is HR one, I have a feeling we'll have a
Speaker 7
more conversations surrounding the impact of HR one. The inability so you had mentioned that that it may not impact the number of students, but maybe where the students are coming from. Correct? Is am I accurately paraphrasing?
Speaker 7
Are there things the state could do maybe to because, you know, I'm kind of forward thinking here to help incentivize the types of students we'd like to see and where we would like them to practice at, if possible, because we don't want, you know, holes of where there are no doctors. Right? Are are there things maybe or maybe in the future the LEA could think about maybe some policies we could look at to help incentivize students to stick around?
Speaker 4
Mhmm. So the the reason why, you know, our initial estimate is that it's not gonna impact the number of students who will attend the medical schools because the admission rates are so low right now that, you know, they'll be able to find enough students to, you know, to enroll in the school, but it will probably have, a stronger deterrent impact on low students who come from low income families because they might not be able to find a viable alternative to the Grad PLUS loan programs. So it's finding a way to bridge the financing gap for those students who might not be able to use a private loan as a substitute. That's potentially one area in policy that the state could consider if they you know, we want to really preserve the diversity in the student population.
Speaker 7
Yeah. And I think just, you know, also just where people are practicing. Right? Because, I mean, I think all of us may or a lot of us, with how big some of the districts are especially too, can represent areas where, you know, if you go into the Central Valley or, you know, I represent parts of the Foothills where maybe we have two hospitals, right? One in South Lake Tahoe, don't represent that particular location, but Marshall Medical Center, you know, up in Placerville, you know, and we wanna make sure, you know, obviously, we have doctors as well, you know, for that population.
That's the only, you know, emergency room, you know, on that side of the of the hills. So it's pretty important to my district and the people that live there. But, you know, I I was reading before this hearing and not to, like you know, we have HR one, and I know that that's gonna be a big topic of whatever happens in the capital this year, and and I understand that, and I understand why. In fact, I've supported a lot of the resolutions asking for, you know, funding in certain areas to be brought back. But, you know, the it's still at the end of the day, we have a systemic issue with recruiting and training doctors in California.
You know, I have here a 2017 report from California Medical Association about the same exact issue nearly a decade ago. So, you know, this is this is I bring this up as a have some systemic issues, burnouts. My friends who are I know very few doctors and they receive a lot of text messages from me. Have four kids. So just put them on rotation, who's getting the text that day.
But but, you know, we all of them, I think every doctor I've ever met, know, I mean, they're hard working. I think there's a general feeling of kind of, you know, burnout. I mean, they went into that because they care for people, they want to help them and things like that, you know. But they also have They also, you know, have things that that they need to do as well. And so I think we have this systemic issue of not just attracting and retaining doctors and where they need to be, but this way predates HR one.
And I'm not dismissing the impact of what HR one might have. We could have all of these students, you know, with very low rates of admission, and then we put people through medical school, and we would still not solve the problem. If we come up with programs to to find doctors where we want them to be and from communities where we want them to come from, we still don't solve the systemic issue here in California. So I think, you know, maybe concurrently as we're looking to address HR one issues, we have to keep our eye on the ball for the issues that we talked about before HR one was even a piece of legislation. You know, before it was a twinkle glimmer in my eye, you know, we've we've had these issues and we've talked about them for quite some long time.
And so let's not forget about those. Anyways, thank you, madam chair.
Speaker 9
Yeah. I fundamentally agree with assembly member Patterson on this kind of the preexisting systemic issues that were, that we've been faced with. I think we had a hearing last year about the gap around the number of physicians that we needed to be able to provide culturally concordant care, kind of the profile of those physicians compared to compared to the people who are seeking health care. And, certainly, there has been a a big issue. I I wanted to focus on the one statement that you made around the, low admissions, rates.
So I think one of the concerns is that we have, not enough people being able to go through our UC, especially our higher education programs here in the state of California. And part of that seems to be that we've made a determination around how many students we can actually support in our systems. So from just a kind of looking at a systemic, issue, wouldn't there be a simple solution of increasing the number of people who are educated in the medical profession in the state of California by increasing those admissions rates? And what would you need to be able to do that? Sure.
Speaker 6
I'll start, and then Doctor. Mutha will pitch in. Sixty percent of Californians who go to medical school have to go out of state to go to medical school. For too long, the state of California has relied on the fact that this is a nice place to live to recruit its physicians. So we haven't done our fair share of of training physicians.
And as it's become a more expensive place to live, we're starting to run up against problems. The addition of visa restrictions on recruiting foreign trained physicians is only going to make that work. So personally I would absolutely agree with you that California does need to expand the number of slots in medical schools and in residency programs. The UC system is trying to do this through the formation of branch campuses like at Merced, like on the Central Coast as well. The challenge we face is that it takes a minimum of seven years to train a physician.
So there's not a quick fix there. And one thing we haven't mentioned is that HR1 also restricts the loans going to other medical professions. In particular, the limits set for PA programs and NP programs are half what they are for medical school or dental school. And you can produce a PA or an NP a lot faster than
Speaker 3
I think that the so I think that point is an important one, that we have plenty of people who would like to go to school here. We don't have capacity. And capacity is hard to turn on quickly, partly because of duration of training. But you also need faculty to be able to do the training, and you need clinical sites for people to be able to do training. So I think there's a cascading effect that it takes quite a bit of planning to be able to increase.
And what we've been seeing partly because of affordability, which is part of our topic here, is that there are students who will take themselves out of the equation because it's just not an affordable option even with the value that UC offers relative to because even our educational debt, which is at a 150 k for our students, and you compare that to the median debt for US, for across the nation, which is 200. So we have a great value. We have a great product. It's just not enough. And I think the other piece we haven't talked about, there are there are societal trends that are increasing demand.
So we have an aging population with more complex chronic illnesses, emergency room care that has gone up, and then you add on to it the other consequences that we expect to see with HR one and other changes that are occurring, and the demand is not going down. So our demand is up, complexity is up, and it takes more of a workforce as a result. Mhmm. Yeah.
Speaker 1
Assembly member Stephanie. Oh, I'm sorry. I'm so oh, I'm sorry. The LAO. I know you have important information.
My my fault.
Speaker 2
I just wanted to, again, throw some more nuance into the discussion, so don't mean to complicate your policy thinking on this. But, you know, the the question you raised really gets at one of the fundamental policy questions about how to address the physician workforce because the education and training pipeline is multi has is multifaceted. It has several steps to it. And where you where you spend your time focusing on can have different sort of effects, your your next issue is really gonna focus on the sort of residency side. Right now, you're focused on the medical school side.
Speaker 2
And it's it's tough to know where to where to target resources. So as you as you say, you know, it it it is it is the case that California has, you know, per capita relatively low number of medical school slots compared to most states. We tend to be a bit more, if my memory is correct, a bit more on the average when it comes to resident slots per per capita. And as it turns out, our residents our residents slots are are pretty high demand too. We are generally able to fill most residency slots in California.
And as you've heard, most residents in California tend to stay in California. So, you know, does building more medical schools necessarily get you more physicians? It's it's not it's not it's not clear that that's that's more effective than, say, adding more residency slots. So that's this is, again, where to think about how to target limited resources. It just makes it complicated because of the the there's multiple places you could point to, and they could have potentially different effects.
Speaker 10
Thank you, chair Addison. Thank you for this information. Am too curious around the lack of medical student spots we have in the state of California when you look at the fact that we need, what, 10,500 primary care providers by 2030. And I am lucky that I'm from San Francisco, so I get the benefit of UCSF if I or anyone in my family needs medical care there. I also grew up in Merced, California, so I'm very excited to see the investments that have been made in Merced with UC Merced.
And I know that UCSF has partnered, as you said, with UC Merced. And I'm just would like to know more information. I don't have to have it now. But going forward, why aren't we investing more in a possible medical school at UC Merced in the rural area where we need access to better medical care, where people don't have residencies? It just seems to me that we have invested so much in this UC campus.
We know that this is a problem in terms of creating more space to train our future doctors here in California so they stay. Is there a report or something you could point to that I could read up on as to the partnership that UCSF has with Merced and the Fresno campus as well to better understand how we may be how what we should be doing as the California state legislature to invest in that resource.
Speaker 3
Yes. We'd be happy to get you information afterwards. But you're right. There's a pretty robust relationship with UCSF with Fresno that UCSF has had and an increased focus on the San Joaquin Region also with the with the notion of, again, grow your own because they they will then be more likely to be distributed in the areas that we need. But we can get you that information as a follow-up.
Speaker 9
I just to to that point, I know that there's also an effort in the Stockton area to be able to really take advantage of some of the higher education institutions we have there. And, we have a champion in, assembly member, ransom around that particular effort. So I I think that that should be part of what I'm thinking about. I just wanted to kind of state for the record around the question that you raised around medical students and kind of where we put our resources. If it's the case that California has 23 medical students per a 100,000 population and the national average is 41 per a 100,000 nationally, it seems that it's a pretty critical, part of the pop pipeline to get us at least somewhere near the national average given the fact that we are one of the largest states providing medical care in the in the country.
So just just, I think, something for us all to reckon with.
Speaker 1
And I'll just make one, final comment before we go to, public comment, which is, you know, this hearing came together and maybe for members on the dais as well to put this in context for all of us as well as for the public who's watching. This hearing really came together because of two things. One, my own living on the Central Coast, not being able to get a doctor. Many of my friends and families who can't see a doctor, doctor Hartzog just talked about finally, going concierge for your pediatrician because you can't get a doctor who stays. And story after story of I had a doctor, they left.
I got another one, they left two, three, four doctors in. You can't find someone. And I would say that's ubiquitous from Santa Cruz, certainly Santa Cruz to San Luis Obispo. But, also, we did an informal survey. All of you, I think, filled it out among members.
And the number one thing members of the legislature legislature said in terms of importance in health care was being able to see a doctor when I need one. And I would say that's representative of their constituents, their 40,000,000 constituents across the state of California who are bringing these issues up, whether it's I have insurance and I can't get a doctor, I've lost insurance and I can't get a doctor, my status is, you know, I'm undocumented. I'm not gonna be able to have Medi Cal anymore. There's a whole host of things. But if we boil it down, it's how are we gonna be able to see a doctor if we need one?
And so California has done some work in this area. And in terms of expansion, doctor Hartzog is part of bringing that expansion to one of our UCs, to UC Santa Cruz via UC Davis. So there are programs that are in process right now that continue. But I think there's really two ways, that we can support getting more doctors in. One is how do we pay for med school, help those, kids or those young people not self select out because of affordability, help them self select in because they know there's gonna be a pathway.
And so that's been the topic of this hearing is what do we do on the med school loan, face of it. And I think that LAO summed it up really well saying there's the, you know, med school loan piece, there's where the programs are, and then there's the residency. So this sort of three pronged approach. So we're just now gonna take public comment on this piece, which is focused on med school loans, and then we're gonna talk in a robust way around residencies and the importance of, how we maneuver our residencies in California to be able to support bringing more physicians and and all of us being able to see a doctor when we need one. So with that, I'll open up to public comment on this item, if there's anyone in the audience with public comment.
Speaker 11
Good afternoon, madam chair. Just a comment. I heard in the presentation talking about loans. Believe 80% of the loans are more focused on primary care, and then there's a 20% that could go to other other specialties. And and I guess I part of there is a problem.
Of course, I come from a rural community, so I I recognize that. So family physicians, internal medicine people, pediatricians, obstetricians, gynecologists, emergency medicine folks all have complicated patients that sometimes need surgery. Because I mentioned I heard surgeons in that as a piece of that too. What I didn't hear was anesthesiologists. So I'm representing the California Society of Anesthesiology here.
There is an acute shortage of anesthesiologists in California and nation nationwide. As a matter of fact, there's, like, 3,800 applicants last year for 2,300 slots. And so the idea that people we wanna attract people to California here if there aren't slots and there isn't the resources to help train and and help people here. You know? How are we how are we going how are we going to do that?
So so I guess my my plea is if you start thinking about loan programs and things, start thinking about anesthesia as well because that is integral to, providing health care, you know, especially in rural communities. So thank you.
Speaker 1
I usually don't respond to public comment, but I wanna welcome doctor Wood back to the back to the green carpet, and, wonderful to see you.
Speaker 12
Good afternoon, chair and members. Omar Altamimi here with CPEN, the California Pan Ethnic Health Network. HR one policy changes will likely result in an even less diverse physician workforce as the impact of reducing loan repayment funding will fall disproportionately on communities of color. We encourage the legislature to ensure that state programs modify their priorities to fill the specific to fill the specific gaps created by HR one and to provide targeted support to trainees who will help to fill the cultural and linguistic gaps in the workforce. We must increase the use of and support the development of primary care teams that include physician and nonphysician providers, including community health workers, promotoras, and community health representatives, recognizing that millions may lose Medi Cal state programs also need to support future providers and safety net programs that serve Californians who are underinsured or uninsured.
Thank you.
Speaker 13
Thank you for convening this hearing focused on workforce as it truly is one of the biggest challenges that is impacting access to care. My name is Katie Leighton. I'm testifying on behalf of the Children's Specialty Care Coalition to speak specifically about the growing workforce crisis within the pediatric specialty physician network. Nationally, a number of pediatric specialty fellowship slots are either at or below 50% filled, and those trends are mirrored here in California. Pediatric specialists undergo years of additional training and often incur substantial student loan debt, yet they earn markedly less than their adult counterparts due to the high volume of Medi Cal.
Pediatric specialists are not necessarily eligible for some of the programs discussed here today. However, loan repayment under Prop 56 and graduate medical education dollars under Cal Med Force Plus have both served as a lifeline to support this pipeline of physicians. Unfortunately, the funding for the Prop 56 loan repayment program has dried up, the GME Plus funding will terminate come the end of the current MCO tax in 2026. And certainly, the addition of loan caps under HR1 will make it more difficult to choose to go into pediatric subspecialty. So really just want to commend this committee for exploring ways to support these programs in the face of federal uncertainty and urge you to continue looking at ways to leverage these solutions, which will ultimately result in better access for patients, including children and youth with medical complexity.
Thanks.
Speaker 14
Hello, committee. I'm Patricia Itam, vice president for Southern California in Coachella Valley with Health Career Connection and also here representing Inland Empire Health Plan, Leadership Network. And, I just first wanna say, for the loans, please consider new, strands to have public service loans so that, factored into the loan repayment also are the HPSAs. I think it's really so crucial and for so many other, practices in addition to MD, primary care, but DO, PAs, nurse practitioners, really, important. Our organization works with many health pathway programs, including the UCSF Fresno, but UCR School of Medicine, the California Medicine Scholars Program, UCLA Prime and Prep, all the UCLA programs, and Charles Drew, they have great pathways, and that sort of leads to the the pipeline.
So as you are also considering just the loan component, please do keep in mind that these pathways are so essential for building the confidence of underrepresented individuals to believe they can make it because they get the mentoring they need and the strategy they need on how to succeed and truly enter medical school. We work so much in pathways, and I think that perhaps for maybe the short term, for some of the medical slots that need opening, consider consortia. I know that there are consortia, like, with different states, and so you could have rotations and consortia spots that might help as you're building out other medical schools. But I really wanna thank, the, you know, the committee, and HR one's gonna be tough in so many ways. But please, with bonds I I mean, like, literally, I'm please think bonds and think out of the box to to make it possible for, our young talent, and the talent is here.
It's here in California, and, look forward to having our whole coalitions work with you all to help solve the problem. Thank you.
Speaker 15
Good evening, chair and members of the committee. Susan Maddenat here today on behalf of the California Nurse Midwives Association. We attend, 1,200 representing the 1,200 CNMs in the state who attend thirteen percent of the state's births, many who are working in maternity care deserts, and fill in provider gaps. I just wanna say thank you to the chair, and members for convening this important, hearing today. Understanding that we're focused on physicians, today and have future hearings on the broader impacts of HR one, we wanted to highlight the important role midwives play in the face of these physician workforce challenges.
We often work in partner, but in many cases, the OB GYN provider gaps in more rural communities. And even before the passage of HR1, given that there was a severe maternity crisis with L and D units closing and maternity wards closing in the state, nurse midwives really do step up and fill in those gaps. And we're really concerned about HR one further excel excess accelerating these challenges, and these student loan caps significantly affect nurses in the profession as well. I wanna thank, members of this committee, assembly member Bonta, assembly member Stephanie, and others who signed on to the legislator sign on letter that we actually submitted to the Department of Ed on this specific issue. And we consider the threats to physician, as we consider the threats to the physician workforce, we wanna urge legislators to take a diversified approach on, addressing the issues to provide care to, to communities in the state.
And I will say last year, CNMA sponsored a b eight thirty six with assembly member Stephanie to study the barriers to establishing, and sustaining midwifery education programs in the state and SB five twenty with, senator Caballero to create a grant program on midwifery workforce education programs. And really just want to say that a sound workforce strategy requires simultaneous coordinated investment across workforces. So we really appreciate your time and attention to this and the partnership of our physicians. Thank you.
Speaker 16
My name, Dennis Mazur. I have only one question and one message from Ukraine. I'm a tourist visit to Sacramento only three day. And now we have a black month history in all the world one hundred years ago. My country one hundred years ago to have a culture revolution in the world.
I'm from a small town, in Ukraine, where, Mikola Levuntovich write music and text, Karolov's Bells. And, sing these songs, traveling around, world, one hundred year ago and be help, be people's happy in the world. One hundred years and now, every year. And, small, twenty five second message from Ukraine. No.
Speaker 1
That it's it that's amazing. We appreciate you coming to visit California, and our hearts are absolutely with the people in Ukraine, all of us. And we're gonna we're in the middle of a a health care hearing, but wanted to hear what you have to say because you've traveled a great distance and, just really appreciate everything that you're doing. And welcome to California state legislature.
Speaker 1
Thank you. We're gonna, close that first portion of our hearing on, on medical school loans and in the face of HR one and how we're going to navigate that. And we're going to move on to the second panel, which is really focused on residencies and invite say thank you to our panelists, and thank you to those who traveled to come here to be able to present. Excuse me. And move on to our second panel and panelists.
Let's see. I'm sifting through my notes here to see if I've got us off track. Here we go. So our issue two is oversight of a program called Cal Med Force as well as the, Song Brown program. Both of these are residency programs.
And we have at the table with us the University of California, the legislative analyst office, the California Academy of Family Physicians, Department of Health Care Access and Information, and Department of Finance, although it looks like we're missing somebody. So I named five people and there's four up here at the moment. But what we'd like to do is start with an overview and update on Cal Med Force, and then, welcome back Doctor. Munta from UCSF. Then we'll move on to a presentation from HCAI with an overview and update on Song Brown, and then we will move to the LAO And then doctor Robert Asebe?
Asebe. Asebe. Thank you. Who's gonna talk about additional perspectives on the state's GME investments. And just as a reminder, we looked at this hearing through two parts.
What can we do to help kids pay students pay for medical school? And then what can we do to increase residencies, and how is that affecting physician access across California? So, please let's go ahead and start with the update on Cal Med Force, and, Doctor. Munta.
Speaker 3
Couple things that I will highlight, and I think many of you know this, so I I won't, belabor, some of it. I think it's worth calling out that, Cal Medforce has different funding streams that support it. There's Cal Medforce and Cal Medforce Plus. So Cal Medforce has been in inception since 2018 with Prop 56. It supported a net increase of about 514 residency slots.
These are new and expanding slots in the state. And Cal Medforce Plus is newer. It is, the the difference in the designation is simply the plus, but the intention is quite different. And I'll describe that in a moment. That is funded by prop 35.
That is the one that we've already said is, will be is at risk with HR one. It prioritizes, the advantage of Cal Med Force Plus was that it it it, prioritizes funding for new and expanded residency positions. And one of the things that will probably become very clear in this conversation is that residency training program takes a lot of resources. It is not only is it a multiyear experience from three to seven years for the trainee, it requires a planning period before that for the institution to develop the capacity to get the appropriate educators in place, sites in place, all of the training that is required to meet accreditation requirements. So it's quite extensive, takes multiple years.
Hence, the need to not only invest in expanding new ones, but to think about, sorry, not only expanding existing, residency training programs, but new ones. So in the inaugural cycle, Cal Med Force Plus awarded 127 new residency slots across high need medical specialties. And, we will hear a little bit more about the differentiation, the criteria that are used. I will suffice it to say sort of at a high level, I think they're detailed in the other materials, that the intention has been to look at places of highest need first by, by profession, by the type of residency training we're talking about. You've heard that we are focused primarily on primary care.
It talked about broadly. So it includes emergency medicine in that and also pediatrics. And that was the original investment with Cal Med Force. With Cal Med Force Plus, it's expanded a little bit further. And what we'll and what we try to do with both of these is that we are very intentional not only about are there resources going to places of higher need and of the professions that have been identified as being higher need, But are they also going to geographic regions where the need is?
And so you'll see that in some of the data, and we can talk more about that. The in terms of commitment and and how far these resources go, they sadly don't cover the full cost of training. That's probably the the most important thing to take away. They cover about 50% of what it takes to to train an individual resident clinician, And and that is going really and those are sort of really parsed out. There are other resources that have traditionally come to support graduate medical education from Medicare, from HRSA in some cases, but those are limited.
And and there has been the other thing, I think, to take away now is that there is a great deal of volatility in this funding support. So for the funding that came from prop 56, what you saw in the materials, if you've had a chance to look at those, is this declining revenue. We should be proud of that, which means that people are healthier, but it means that there's declining revenue. And there is not the capacity for the state to backfill, which it did originally, to try to meet the initial intent. And with the 75,000 75,000,000 that, HKai mentioned earlier in their comments that have been, identified for prop 30 oh my gosh, 35.
Thank you. Those are we can count on two years, and that's it. So we're talking about having launched. We're talking about trying to really put, training programs in places of highest need and to be resourced to some degree to be able to actually fully meet their obligation for training residents so that our communities have highly trained, highly skilled clinicians available to them across the spectrum of things. And the the last call out, I will say, is one of the big advantages, and we don't track this fully from residents trainee to health benefit, but we have great data nationally that show us that an investment in primary care actually leads to longer lifespans.
I'll stop there.
Speaker 1
Thank you. And we'll move on to a presentation from Itch Kai on Song Brown.
Speaker 5
Absolutely. Thank you very much. I'll give just a very brief overview and then, of course, happy to answer any questions. Established in 1973, the Song Brown program aims to expand and support primary care residency training in California with the ultimate aim of increasing the workforce that serves underserved populations. Programs in family medicine, internal medicine, pediatrics, and obstetrics and gynecology are eligible for funding and are scored on a number of criteria, including how much of their training takes place in shortage areas or in Medi Cal settings and whether their graduates continue practicing in primary care and in underserved settings.
The SongBrown program receives $33,000,000 in general fund annually, and the program funds four types of awards, each with fixed appropriations. So of that, dollars 33,000,000, dollars 31,000,000 is for program, and that breaks down to $18,700,000 for existing primary care slots, 5,700,000.0 for existing slots in teaching health centers specifically, 3,300,000.0 for new slots in existing programs, we call that our expansion track, and then 3,300,000 for new programs starting from scratch. And the numbers are important, but I also just thought to share a nice bright spot in our recent round of awards. We did fund under that new residency program track a new family medicine program in Del Norte County. So nice to share that we are reaching rural communities.
Over the last five program years, Song Brown has funded eleven fifty existing slots and four twelve new or expansion slots, and just noting again that our ability to fund new or expansion is prescribed in appropriation.
Speaker 2
Great. Thank you, Jason. Concenturos, LAO. And, we're speaking from this handout here, which may be in your materials. And just for context, as we, this handout is the culmination of, work we did over the summer to dig more into the Song Brown and Cal Med Force programs.
And we did this to help better answer questions we have gotten from members over the years about these programs. The handout has a number of as as fair amount of background and findings. Staff asked us to kinda skip ahead to our assessment just for the sake of time, so I'm gonna go ahead and do that. And you can actually find our assessment starting on page 15 of the handout where it says issues for legislative consideration. And in our view, there really are three key questions before the legislature around Song Brown and Cal Medforce.
And the first issue is really a topic you you covered in issue one to some extent, which is should should supporting residency programs be a high budget priority, particularly in light of the fiscal constraints facing the state? And, you know, as we summarize here on on page 15, there have been a number of studies that have documented certain workforce concerns, particularly, in some cases, statewide supply and demand issues, also regional disparities. And also, HCAI is currently in the in the process of further revamping its workforce analysis. We we the state may have even more detailed workforce analysis and projections around the medical workforce specifically in the in the coming years. So that might help the state even further understand kind of the specific needs.
So, you know, now the question is, well, if you support residency programs, will that help the state with its physician supply issue? And, you know, as I as I said in the last issue, it really is difficult to gauge. The physician pipeline is has multiple stages to it, and then there's medical school, and then there's residency. There is data that that show that, you know, most, residents in the state stay here after completing their residency. We're we're we're not aware of as much data on, whether or not those physicians you know, how how many residents stay in their local communities after after completing.
As we noted, there are other strategies the state has been pursuing, like loan repayments and more recruitment in medical school. And so these would be strategies to to weigh as you're as you're thinking about your priorities. But assuming that residency programs are a high priority for the legislature, the next question is, are these particular programs, Song, Brown, and Cal Medforce, the the best way to support residency slots? And we start that we start our assessment on that on page 16 of your handout, and we try to get at this looking at a number of things. The first question we try to answer is, do have these programs actually resulted in the state having more residency slots?
And to do that, that's really what the that figure on the bottom of page 16 is trying to get at. And it's a little bit of a complicated figure, but to explain it, it shows the percent change each year in residency slots for different medical areas. I apologize for the small font too. And it's, that dark brown that dark line is really the national trend, and the light line is the California trend. And then that vertical line there is marks the twenty seventeen year.
That's when the state began expanding funding for Song Brown and Cal Medforce. And so the question is starting at that point, do we see a notable change in trend in the state relative to the national trend? And, generally, what you see in the graph is there isn't that much of a difference across most areas. The one notable difference is obstetrics and gynecology where you do see a relatively large increase. But other than that, it they they seem to more align with national trends.
That isn't terribly surprising if you consider that the grant programs mostly focus on existing slots, in particular, Song Brown. And also, as noted, the programs the the the grants are not funding the entire cost of a slot. And so programs do have to find other sources to support the slots. That said, this is an initial analysis. It's not definitive.
One thing we can't rule out in this kind of analysis is that the grants didn't result in didn't didn't prevent, like, notable declines in residency slots. So this there there's, still some uncertainty on the overall effect. Turning to page 17. The other question we asked as well, is this is having a competitive grant pro process generally the best way to support residency slots? And in concept competition, makes some sense because you're taking limited resources and, targeting them to the, you know, the highest sort of beneficiaries.
But we found a we found two things that sort of questioned whether, you know, cup competitive process really was the most effective strategy, and that is that most of the applicants, tend to get a tend to get an award. And, also, of those who get an award, most get it more than one year. And so for a lot of residency programs, these grants end up looking like operating funds that they were they're relying on sort of multiple years. And if this really is, more of an operating ongoing fund source, perhaps there are other strategies the state could consider than competitive grants. For example, expanding funding in the Medi Cal program.
That's easy to say. There's a lot involved in in thinking about changes to Medi Cal, particularly in light of HR one, but these are strategies the state could explore. And then the the kind of the third issue is, okay. If you if you say that if you just if the legislature were to decide that, you know, residency slots are a high priority and these it wants to support these programs, are these programs, you know, designed in the best way? And we we found two potential, issues with the design of these programs that we think the legislature could consider.
The first is that these programs have somewhat, you know, rigid structures in place. They focus on on some medical areas but not others. Even though in some medical areas like psychiatry, there have been documented workforce issues. And then also in the case of Song Brown, as noted, it's even more rigid because the budget bill language really specifies how much funding has to go each year for, new slots versus existing slots. And this is an arrangement that was worked out several years ago.
But but with such with such a rigid structure in place, it might not be as adaptable to sort of changing state workforce needs. So legislature could explore ways to add more flexibility to the programs. If it were to do that, it could also look at the advisory councils that help oversee these programs and ensure that they're somewhat independent and are able to provide in you know, a good analysis to help guide the programs. And then finally, we also noted that there there are some coordination issues with these programs, and this is something we've said in the past. These programs are very similar.
There's a lot of overlap. We have a figure on page 12 that really shows how much overlap there is between the grant recipients between each program, but it's a it's a fair amount. And, fundamentally, when you have two programs doing similar things, there's some inefficiency there because you're paying for more administrative costs. It also raises the possibility that, there could be some coordination issues, and we we did hear some when we met with residency programs. For example, one of the things we've heard we've heard from some residency programs is they use the Song Brown and the Cal Med Force grants somewhat differently.
The Song Brown grants are more for sort of direct costs like, resident stipends. Cal Med Force grants tend to be used more for kind of the let more indirect costs like, sort of wellness programs and outreach and other activities like that. And it didn't it didn't appear that there was a a strong sort of strategic basis for for these differences. And so we think if the legislature wanted to continue with these programs, it it could it could consider ways to, either con consolidate or coordinate them or to differentiate them or or a mix of that. So for example, could the could the programs have a single core, advisory board that really advises across both programs?
Or alternatively, could the could the state lean more into the sort of Cal Med Force Plus approach of of having one program focus more on primary care, another focus on specialty care? These would be things to explore as you're as you're thinking about your budget priorities. Thank you.
Speaker 1
And I understand, DOF, we didn't ask you to present, but you're here for questions afterwards in case anyone has finance questions. So, we'll move on to doctor Robert Aceveday from the association excuse me, from the Academy of Family Physicians.
Speaker 17
Thank you. Good afternoon, chair and members. Thank you for the opportunity to speak today. My name is doctor Rob Acebe, and I'm a board certified family medicine physician and currently serve as an urgent care physician and home based care physician, providing care to our elderly population who are unable to make it to the clinics due to various reasons and not concierge medicine. And I'm also additionally a board member of the California Academy of Family Physicians.
So, additionally, as a former associate program director at residency program, I'd spent years training residents and students. And I'm here today to discuss a critical role that the state needs to play in supporting physician graduate medical education programs. So primary care is the foundation of a functional health care system. Family medicine is uniquely positioned within the primary care setting. Family physicians are trained to provide comprehensive continuous care across the lifespan from delivering babies to caring for seniors.
Unlike other primary care specialties that focus on specific age group, family medicine physicians care for patients of all ages, often treating multiple complex comorbid conditions within generations of the same family. We manage chronic diseases, provide preventative services, coordinate specialty care, and serve as a first point of contact for many patients, making family medicine especially vital in rural and underserved communities. Like has been stated earlier, research consistently shows that communities with more primary care physicians have better health outcomes and lower health care costs and reduce health care disparities. Unfortunately, we know California faces a severe primary care physician shortage. The demand for primary care physicians will continue to grow as the population ages, particularly given that their primary care workforce is itself is nearing retirement.
And while we're graduating a lot of medical students in California, we don't have enough residency slots, as been stated earlier, for training, so a lot of them end up in other states. Since physicians do tend to stay where they train, many of these physicians do return do not return to California. Furthermore, systemic problems make expanding primary care workforce especially challenging. The systems in place incentivizes physicians to specialize, contributing to a shortage of primary care physicians who face lower reimbursement, significant administrative burden, and high rates of burnout. The recent federal policy changes and funding cuts to student loan repayment programs and Medicaid are intensifying the existing barriers to primary care physician recruitment, training, and education.
One important step toward increasing the number of primary care physicians is increasing the number of residency slots. Investing in new residency positions in underserved community increases the access to care in the short term while also addressing long term workforce needs. Given that a majority of the physicians practice in the same region where they complete their residency, As stated, song ground program is the only state GME program that directs funding exclusively to primary care residency programs and is the only GME program that takes into consideration recruiting minority physicians like myself. I'm originally from LA, and I'm a direct product of the song ground program. I trained at a residency program not too far from here in Stockton, California and stayed on to practice in that community that trained me as a faculty and associate program director.
To take care of that community additionally to recruit others students to do the same. And to be quite frank, the Song Brown program is the reason that program still exists. Approximately half of the graduates supported by Song Brown programs have gone on to practice in the areas of unmet need. So dependable and consistent funding for this program is essential to ensure sustainability and predictable funding for the family medicine training in California. Additionally, Cal Med Force and Cal Med Force Plus programs are also important to support GME programs.
Public funding for these programs should be strategically invested in the most cost effective manner possible by prioritizing resident programs in the areas of highest need and specialties facing the most significant shortages, particularly primary care. Primary care is associated with improved health outcomes as stated earlier. So targeting state funding toward primary care residency expansion is therefore not only responsive to documented workforce shortages, but also represents prudent and high value investments in the state's long term health system sustainability. In the last cycle, 60% of CalMed Force Plus awards went to specialty residency programs, including a plastic surgery program. Given the state's limited resources and significant unmet need in primary care, future funding decisions should be determined in a data driven way to more deliberately align with the workforce gaps and statewide access challenges.
There is also uncertainty surrounding the revenue sources funding these programs, creating an unclear picture for the future. In conclusion, primary care is not a luxury. It is the backbone of a high functioning, equitable, and cost effective health care system. If we do not act now and strengthen the primary care workforce pipeline, shortages will deepen, access gaps will widen, and communities like mine in the San Joaquin Valley will continue to struggle to meet basic health care needs. The state has both the responsibility and the opportunity to lead by ensuring sustained funding for song ground program, directing Cal Med Force investments toward primary care and those high need communities, and securing stable long term support for graduate medical education.
Every primary care residency slot is an investment in healthier communities and stronger, more sustainable health care system. I respectfully urge you to prioritize funding for primary care residency programs aligned with the state's greatest workforce needs. Thank you for your time, and I'm happy to answer any additional questions.
Speaker 1
Thank you. We're gonna go to, questions from the dais and and, public comment. I do have a question. Didn't bring it excuse me. I didn't bring it up in the first panel.
But, you know, one of the things that we're facing under HR one is an expectation of overloaded emergency rooms. I'm just wondering if anyone can add some context around what the lack of primary care physicians is doing when it comes to people who still need to go to the doctor. So again, we've talked in many other hearings around the cliff we're facing around undocumented care, cuts to Medi Cal, around cuts to covered California. But we also have this other problem where people have insurance and they still can't get a primary care doctor. And, you know, what is that doing to our emergency room situation that's gonna be exacerbated with HR one?
Speaker 3
Happy to speak to it. You're absolutely right. The the demand isn't going away. The opportunity for having a place to go is going away. And in some cases, you know, many of our institutions are required and obligated to see whoever comes in for care.
So there are double digit increases already in the volume in emergency departments. Part of it is seasonal with the flu season Mhmm. But not all of it is, and we expect it to get worse. That is what has happened historically in the past when insurance, and access as a result of not having insurance occurs. So expect that it gets worse.
We know it's already a little bit of a a release valve for people who need to get care. Urgent care is often not used in the same way that emergency room is. Some of it is, I think, also public education about how people where people choose to go, where they think they can get care, and how quickly they can get care. So the increases are already happening, and we expect that they'll continue and worsen. And our obligation in those settings is to provide care, which has a financial implication then for our institutions.
Speaker 1
And are you seeing in areas where there's just not enough family physicians regardless of the insurance situation, where there's just not enough family physicians or people using the as their primary care, or is that
Speaker 17
Yeah. It seems that people are doing both. They're using the ER, and they're using the urgent care a lot. Like I said, I also practice in urgent care setting, and a lot of patients are coming because they're out of their medications. Medications have been out.
Their blood pressures are now extremely elevated. It's increasing risk for stroke or other major, conditions. And they don't wanna go to the ER because they know the ERs are now full and taking seven, eight hours to be seen. So now they're coming to the urgent care where it used to be less than thirty minutes or an hour to be seen. Now it's taking two hours, two and a half hours for patients to be seen, and it is creating a significant burden on those patients and even the providers in those urgent care settings.
So what's happening is it's a a bottleneck everywhere, and a lot of patients then will just stop going in. And then you're gonna get a lot more patients coming in extremely sick where they end up getting hospitalized a lot faster and then increasing their health care dollars.
Speaker 1
And I heard I mean, we've heard the figure on both panels that, residencies, eighty percent of folks who do their residencies end up staying in California. When I look at the county by county data, I'm seeing 35 counties out of 58 where Cal Med Force is helping fund residencies. And then 19 counties out of Song Brown, not 19 additional, 19 that overlap that are helping fund residencies. And so at a minimum, there's 23 counties that don't have don't benefit from these programs. There's residencies not going into these programs that are funded through Song Brown or funded through Cal Med Force.
And I'm just wondering ideas on addressing that geographic inequity knowing knowing that we talk a lot about highest need, but I think there's changes in what we might now determine highest need. I think a lot of us have an impression that highest need equates to lowest income, but I think, actually, a lot of our counties just don't even have programs that can bring residencies in, which is having an overall effect. And I would sort of suggest those are highest need areas. But what ideas from anyone at the table to create more geographic equity in terms of how those state dollars are gonna support residents.
Speaker 5
I'd I'd be happy to share two thoughts from HK. So I think I would just, one, point back to the issue that we are limited in by appropriations in how much we can fund new programs. And so part of, I would say, a constraint is that we can only fund where there are already programs. So I think what you're asking about is, you know, how can we get funding to the counties that may not have programs or might, you know, face those kinds kinds of constraints, we are we are constrained by appropriations and our ability to do that. To the second way I would sort of answer that question, how can we think about getting programs where we face the greatest need?
Valio mentioned this. We are in the process or we're hoping to start some supply and demand modeling for both primary care workforce and maternal health workforce. So right now, in a lot of the data that are cited in some of the handouts and even on my answers are around physician to population ratios. That's one way to think about sort of access and equity, but it's not our best way. And so we are at HCAI planning to develop supply and demand models which will help us see where is that greatest need.
So it's not just about distribution, it's about, Doctor. Mutha has mentioned, service demand a number of times. Where do we see the greatest demand compared to the biggest gaps in workforce? So we intend to develop models for primary care and for maternal health. Importantly, those will be sort of team based approaches.
So for primary care, we'll be looking at physicians, but also nurse practitioners and physician assistants. For maternal health, we'll be looking at OBGYN, but also certified nurse midwives. And then the intention is to use the outputs of those models to guide our Song Brown funding and other education capacity expansion funding as well as loan repayment. So we've done that for our Song Brown nursing program. We developed a Song Brown I mean, a nursing supply and demand model last year and integrated that to actually make decisions about where our Song Brown funding goes.
That's a promising strategy we intend to follow.
Speaker 5
you So we hope we hope to use the funds from Rural Health Transformation, which we're still in budget negotiations with CMS. You're probably familiar with the Rural Health Transformation program. That's how we're going to fund the development of these models. We hope to have a sort of quick beta version for decision making by mid this year. We hope to have a robust version by the end of this year or early next.
Speaker 3
things worth calling out here. This issue of what the statute allows for each of these programs, I just will call it out. So for Song Brown, it prioritizes family medicine, as you well know. Cal Med Force by statute supports primary care and emergency medicine. And I think you start to see this evolution with Cal Med Force Plus, which says we understand the environment is changing.
We understand the specialties that are needed are changing. So for Cal Med Force Plus, it extends to new and expanding because we know there's a cost associated. A typical program, sort of the cost per resident is about 300,000, and these programs are paying between 40 to 50% of that cost. So the institution has to find other avenues, whether it's institutional resources, federal resources, philanthropic, whatever they are in order to do that. So with Cal Med Force Plus, it expanded to AGME ACGME approved specialties that are psychiatry, general surgery.
You've already heard about that there's shortages there. And then other ones, and they're really the idea is to align the funding with high demand specialties for Medi Cal patients. So there is an intent to try to to do that, and I think it makes sense long term to be really thinking about population needs and and how to align those with those resources. And then one last comment is I think what is hard about graduate medical education, it's not a you build a system and then it continues and those resources stay there and sort of allow the system to work. These resources are very much dependent on the humans that are going through the programs, which means that you have recurring costs in addition to capacity and capital cost to build the programs.
And those are magnified, I think, in rural and geographic areas. It takes great expertise to actually design a approved GME program and then the resources to build all of the services and components of that program so that they meet accreditation because that's what we want and need and can be sustained over time.
Speaker 2
Please. Well, I I was just I was, thinking about your question. You know, the, You I know, think one of the the key, policy issues with, you know, financing residency programs is that the current structure is really focused on, programs that have a high intensity of Medicare inpatient services because that is how Medicare supports residency programs. And so a lot of, you know, there have been some efforts to try to, you know, find other ways to support in in different settings, and that that that could be one, you know, thing to think about. That's also important to understand the impact of, new for pointing for new programs is it's not just the start up that is sort of as indicated.
It it often works best when the program has the the ability to draw down more Medicaid dollars over the long run to help support ongoing costs. And, actually, there's an advantage to that. Medicare caps generally programs at at the slots they were at, in the late nineteen nineties. But, for new programs, there's there's actually a grace period before you hit your slot. So that, you know, that that was sort of the strategy with the new programs, but it there are those limitations that that sort of need to be think about.
And so that that's tended to be kind of the the the sort of key barriers and issues to sort of address with the with the new grants.
Speaker 17
I was gonna say one thing. Just to piggyback on what was just being said in regards to these caps and Medicare. So my residency program there's three residency programs. They're internal medicine, surgery, and family medicine. And the caps were set back in the nineties, and there was about 45 residency slots that were set back then.
There are currently 77 residency slots, and the institution has to then subsidize the remaining difference. And what they do is they're gonna prioritize the ones that they feel are more high revenue or make them more money. So surgery and internal medicine receive a majority of our slots. We had eight residency slots per year, and about three of them are funded by our caps, and the remaining was Song Brown and Cal Med Force. Reason why I stated earlier that if it wasn't for Song Brown Med Song Brown and Cal Med Force, our residency program may not be able to serve a underserved community like the Stockton community where we have eighty six percent of Medi Cal patients and less than ten percent of Medicare patients in our institutions.
The residency funding is not there. So these programs are very vital to that.
Speaker 1
Thank you for that. Any questions? Assembly member Slachey hasn't talked hasn't asked yet.
Speaker 8
Thank you, madam chair. To your point, every time I come to a hearing, I feel more inspired and excited about the subject matter. In fact, doctor Acebe, his story, his journey was pretty pretty inspiring, and the fact that he's been doing lot of good work in community space, it's good to hear those those those moments, those those success stories. So thank you for sharing that. I mean, I want to take one step back to the basic part of of this conversation.
Obviously, very intriguing to understand the the the complicity of how the resident program happened and what happens, you know, the the numbers. So thank you for sharing the data. But I I take the one step back of what are we doing as a as a state, as partners to encourage students to get into this medical field. Right? I know we hear it as, in higher education.
We hear it in in, you know, in in in college, centers and camp in high schools, but I wonder what else are we doing. And so I I asked that general question, but it's a little bit outside outside of of this specific discussion, but obviously related to how do we encourage young folks to to get into these medical fields. Obviously, the the cost is an obstacle for in itself, but I'm just I'm just curious to see if there's any data or any information, again, not today, that could be shared today, but just wanted to know if there's if we could dive into that kinda, part of the competition because I think folks need to understand that this is you know, there is is attainable somehow and that there is possibilities. Obviously, the data doesn't quite share that one once you get into into the into the medical field, but I just wonder if there's any current programs that maybe the state has or any that, you know, that we have done in the past or are currently doing, just for my own understanding and knowledge. But, again, thank you for sharing your your story, doctor Espe.
Speaker 5
Yeah. Thank you for that question. We do have pipeline and pathway programs. I'd be happy to share some of the details of those. I don't have them in front of me.
Funding for those is relatively small. However, we've found some ways to expand that, including in partnership with Covered California. We recently just added $5,000,000 this year for Pipeline and Pathway program. We're also in the process of programming our BHSA, Behavioral Health Services Administration dollars, and thinking about how we can use that to fund Pipeline and Pathway for behavioral health specifically. So there's different ways that we do that, and I'd be happy to share a snapshot of those programs.
Speaker 8
We'd love to learn more. And, again, the foundation part of these these programs would be essential to, you know, the success of of of when they actually enter these programs.
Speaker 3
Yeah. I'll again, I think we'll follow-up with you. But there are the factors that influence the decision of a medical student to choose a career are pretty well defined Mhmm. Including do you have exposure and experience practicing in that setting
Speaker 3
Which is we've sort of we've we've touched on that. So we'll be happy to
Speaker 8
some And and I'm big on exposure because I I took ENT class, and lord lord knows I this was not enough feel for me. Clearly, why I'm on this side of the aisle and not in the medical and not in the hospital and god bless our our health care workers because Yeah. Just being in an ER room was very challenging for me, especially being gender phobic. It was really hard. So just put it into context that it's not for everyone.
But for those that do appreciate the field, I wanna be supportive, and we should be all as California supportive of of folks. Right? So I just wanna share my perspective of, you know, that not every feels for everyone, but thank you for sharing.
Speaker 3
If I might offer one one opportunity, which is I think you raised the question, Gerardus, about, well, what else could we be doing to help encourage things in the directions we want? And I think part of what you're starting to hear is part of that direction, which is what happens to these trainees? Where do they go? How well can we track them? And I think we have some data from Song Brown.
We absolutely have data from Cal Medforce and Cal and Cal Medforce Plus. It's too early to say, but we can we can start to look at that information of investments and how does that investment actually benefit community members, and how does that match to what the Medi Cal penetration is in those areas, what the community health needs are in those areas? So I think there are ways we can design these things to to align our incentives and our priorities. And we see that a little bit already with the Cal Med Force Plus. It it is a chance to say what we knew and what the priority was, which was primary care, is critical.
And we all, I think, agree on the value of that. And there are other areas of need, psychiatry being a great example of one that we are much more well versed, I think, in what the demand is and how it completely outstrips capacity.
Speaker 1
I appreciate that. And just to build on that, as somebody member, it's really the primary question of why I wanted to do this hearing is, you know, one piece is how do we get students interested in medicine? And for those that become interested, how do we make them see that this is viable? Because it's the financing that often is the is the biggest hurdle. But as somebody member, Bonta, you had a Yeah.
Question.
Speaker 9
Just a couple questions. One is around the kind of LAO report on, I don't have my glasses, I think that's page four. Thank you for the the the graph, actually, that looked like, my last, heart check. But on page four, I think one of the points of information that is curious to me is that we actually don't have a lot of information about the extent to which private insurance is involved in funding and supporting residency programs. Do you all have any visibility into how we might be able to get more accurate information about the extent to which private insurers are contributing to building our health care workforce and our residency programs?
An area of opportunity for us.
Speaker 2
Yeah. I I think this is a this is a key question that Hard. You know, it's it's been difficult to answer. I will say, anecdotally, we heard from residency programs that they they were, in some cases, you know, not all some residency programs are, like, consortia that partner with hospitals to to support the programs. And what what they typically said is they get some institutional support from the hospitals, and that it under we it sounded like a lot of that was sort of net patient revenue coming from from different sources, and it it wasn't it wasn't one pair or the other.
It was just sort of, you know, just general institutional revenue. And that that might be how it looks like at some hospitals where it's just sort of operating funding that's that's going to that. And but it it's it's hard to know what there isn't there it part of the challenge is a lot of the private a lot of private insurance, they're sort of confidential agreements, so it's hard to it's hard to have a lot of visibility. Yeah.
Speaker 9
Seems like an area of, potential inquiry. I also just wanted to ask about the structure of these. It's actually three separate programs. And just given the fact that they will be around, although they are both attached to declining revenue sources, is there a sensibility around how those were structured in the first place? Was there any coherence around the development of these different programs?
And what should we be looking at in the legislature around continuing to figure
Speaker 9
to create more of a streamlined approach given the fact that there are, according to the LAO's report, significant inefficient administrative inefficiencies with these programs.
Speaker 3
Yeah. I don't know that I can speak to that latter part, but I think I will talk about sort of what the effort has been to do the coordination. So some of it is very much structural. So Doctor. Dina Macrae, who is not here today to represent UC, as of, we have there is a very strong working relationship between HCHI and also, Cal Med Force.
And part of that is that, doctor McCray sits on HCHI Health Care Workforce Education and Training Council, which helps to coordinate a lot of these health workforce initiatives. You heard earlier that by statute, they are designed to sort of address different kinds of needs, whether it's new programs or expanding slots. And I think the one thing I probably the most important takeaway is I don't think that we have, I I think the most important takeaway is really that we have insufficient funding and not. I'm less concerned about duplication of service because of the distribution, what the statute, what room there is to make other changes, but we have such high need. If you look at the numbers of people who apply for this funding, it far outstrips the funding that is available just based on demand alone.
And then we could say, can you parse out a little bit more about what is duplicate? What are existing programs that are coming back to ask for additional funding? Part of that makes sense to me because these are ongoing needs, to provide support for our program. But I think the the sheer number of applicants that we have seen for these programs is probably our best marker for what's the demand.
Speaker 9
I'll certainly stipulate for sure that there is insufficient funding given the prior panel and what we know to be true. Yeah. I do think that one of the objectives that we need to be focused on this year is making sure that the funding that we are providing from the state is efficiently administered to the extent that we need to, make sure that we are engaged in cost savings and maximizing our efficiencies for the different kind of programming that we do offer, I think, is, one of the things that I certainly will be focused on, in this capacity, and I know it's a, prerogative and of deep concern to our chair as well. So I would love to kind of understand that a little bit more. And then my last question is, to HCAI, very intrigued and excited about this, kind of market assessment that you are doing.
Was there, do you have a kind of a pipeline of different other analyses that you were looking at, particularly around health care providers who support our kind of pediatric focus as well as health care providers that support our our elders, given the fact that we have such a growing number of of people who are, you know, our silver tsunami?
Speaker 5
Yeah. It's a great question. I can share what is in the pipeline now. So we have conducted supply and demand analyses for the nursing workforce, sort of irrespective of practice area, and then behavioral health. As I mentioned, primary care and maternal health workforce are next.
We're actually in the process of completing, and we're about to release oral health. We do not have specific plans for the workforce that serves older adults, for example, or pediatrics. We are somewhat limited to what we can pursue based on sort of what we have funding for, which is why with the Rural Health Transformation money, we're looking at primary care and maternal health. Certainly open to feedback and further discussion. It's absolutely an area of need.
Speaker 17
Just a statement on that. I think it's also important to recognize that when we talk about these funds going toward primary care and specifically family physicians, we do serve pediatric patients, maternal patients, obstetrics, additionally geriatric patients. So I think it's important that when we have these conversations about pediatric patients and who is serving pediatric patients, we do include family physicians in that conversations because that is one of the things that we do. And I think that's one of the things that has helped me in my practice, especially even in the urgent care setting, being able to take care of babies, additionally, geriatric patients.
Speaker 1
Any other questions? I guess I have one one last financial question. I mean, we've talked about volatility in funding streams, but what does that really mean in terms of the state and the future of these programs? We know 56 is declining. 35 is highly problematic under HR one.
I don't think there's been very many allocations in the state budget. Certainly, program hasn't grown you know, the allocations haven't grown. So, I mean, do we even I I guess, just to be blunt, do we see the program surviving? And what you know, like, how dire is the situation in real life?
Speaker 3
I think if you tie this it's a great question. I think if you tie this to the question you had earlier about distribution of programs and where they are, I think it's very dire because there is no other funding source to pay for launching programs in geographic areas of need where they don't currently exist. And expanding capacity in the programs we do have is one thing, but we already know from that distribution kind of they are heavily urban and and heavily focused on sort of more specialized care. So I I don't I don't think there is any other funding source Mhmm. To make up for a gap like that.
I'm from the aware of.
Speaker 5
can just share that first song, Brown. Our funding is ongoing, 33,000,000 per year. And we have received onetime augmentations in the past that allowed us to expand our scale. So the numbers you see in some of the data we shared reflect those augmentations. So our ongoing 33,000,000 would be at a a slightly lower scale.
Speaker 1
Mhmm. And from the finance folk, either LAO or DOF, any anything to add in terms of how we can address these gaps?
Speaker 2
You know? Well so, you know, I I would I guess I would say, you know, the you know, as you know, as the the programs really are different, you know, financing wise. Song Brown, you know, that really is dependent on general fund appropriation. So that that's really sort of the issue in terms of thinking about volatility. When it comes to Cal Medforce, I believe the current funding level is just over 20,000,000 a year from prop 50 '6, but it has been sort of declining over time.
So in the long run, you you could expect the program to make have to make, greater decisions around how many, programs to provide an award for and also what what's the size of the award. That that that's typically the program's two key, ways of sort of managing its funding levels. You know, again, you know, if it's just a straight funding issue, I you're gonna hear from us a lot on this this year, but, you know, those the state does have sort of fiscal constraints, and so it is gonna fall a bit on your priorities. There were some years too where the there was a period of time where the where the song bound program was the the legislature ceased providing general fund support. That was in the early two thousands.
And there were some years where they where the program was able to rely on some other fund sources. We have a we have a data fund that was a few million dollars. There were some, private donations from the California endowment. So it also is the case that that perhaps the programs might try to be a bit entrepreneurial and find other fund sources, but that's very uncertain and and difficult to predict. So it is it is a bit uncertain, but the the the primary mechanisms in place are to adjust how many programs get an award and or and or what's the size of the award.
And that that's those are really the key levers sort of in place.
Speaker 18
Yeah. Joseph Dawson, Department of Finance. So at this time, the governor's budget is not does not include, you know, new significant kind of spinning proposals. It's more focused on continuing the implementation of previous investments in the health care workforce, noting that kind of the budget situation we're in that, you know, where we're at right now, we're coming after three past budgets of dealing with difficult decisions of balancing the budget. You know, that being said, though, the budget still maintains kind of past investments that have been focused in the realm of health care workforce, noting that since 2019, the state has invested over 1,900,000,000.0 in various health care workforce investments, whether it be at HCHI department of public health or department health care services.
And then statewide, the state has invested nearly 3,600,000,000.0 related to workforce investments across a myriad of departments. As my colleague from HCHI noted, there is funding to tune of 1,900,000,000.0 related to BH Connect, and then there's also the the onetime award from the federal government related to the rural health transformation grant that will be, you know, something the department is pursuing for this for these activities. So I just wanna rehighlight those investments.
Speaker 1
I appreciate that, and we're about to move to public comment. I guess, you know, I would just close my comments by saying that I hope as we are moving towards May revise that it's apparent that, we did this as the first hearing for a reason and that the dollar amounts that we're talking about, 33,000,000, is actually relatively, minuscule in comparison to our state budget. And that the bang for the buck that you get in terms of investing in residencies sounds pretty high, and I'll just name that figure again. If 80% of people who do their residencies in California stay in California, that's an incredibly high level of success. So I just would urge us as we go through the budget conversations and, you know, we've talked a lot about having transparency as we move towards, May revise and wanting to have a lot of conversation there that this is one of those pieces that I think I'm hearing from folks on the dais and assembly member Patterson who had to step away, is incredibly important.
And number one on people's minds, I'll just say it again, if you ask people, you know, what do you wanna fix in health care? They will say, I I wanna be able to see a doctor when I need one. I don't wanna have to go to the emergency room. I don't wanna have to go to med stop. I just wanna go see my doctor when I'm sick, and I think we may have a clear pathway to be able to make some movement there.
So I wanna thank you all. Open it up to public comment if you could welcome to stay on the dias during public comment or stay at the table.
Speaker 19
Hi. Good evening. Beth Malnowski with SEIU California. As folks are aware, we proudly represent, residents and physicians in training through SEIU CIR Committee of Interns and Residents. Really appreciate the conversation, say the framing.
I just want a second, in some ways, your concluding remarks there. SEIU has long been supportive of residency funding this state, especially programs like Song Brown. The track record is clear from the remarks you've heard from everyone today. Just, you know, I appreciate your framing today around HR one, and wanted to take that one step further to say HR one is a reflection of a GOP congress and a White House that is not committed to the health of Americans, not committed to the health of Californians, and the challenges that were reflected earlier around, just federal policy on GMA, that's not gonna be changing anytime soon. Right?
So we really do have to rely on ourselves, the experiences that we have here, the data that shows what works, on making smart choices about those investments because sadly, we're not gonna be seeing anyone else come to our rescue to support these really critical programs. So thank you.
Speaker 20
Good afternoon. Angela Hill with the California Medical Association. Thank you, Madam Chair and committee, having this conversation today. As we heard today, investments in these programs are highly successful. So thank you so much for having this conversation.
We strongly support, as we can, expanding supporting residency and fellowship programs, particularly in underserved areas. We do think that's going to strengthen California's ability to close regional gaps, improve access to care, and build a more diverse, physician workforce that represents the communities that are being served. Given our aging physician population, and the shortage of medical students and residents, we do think that California needs to continue making more investments to ensure that patients have access to quality care for themselves and their communities because they deserve it regardless of where they live in California. We look forward to partnering with the legislature and the committee, on these issues to bolster our investments in this space. Thank you.
Speaker 21
Good afternoon. Afternoon. Brian Aguilar with the Physicians for Healthy California, the philanthropic arm of the California Medical Association. Thank you for your time on this very, very important issue for sure. I come here as a, you know, one of the product administrators of the GME workforce program Cal Medforce and Cal Medforce Plus, and we'd love to share more data with the committee and with panelists as well and the LAO around the specifics, the outcomes of our program, well as the way in which we happen to run a very data driven, a very a stakeholder GME stakeholder influenced and fiscally prudent organization.
I just wanna take the time to offer the committee two points of clarification on some of the data that was provided today as well. CalMetForce is prohibited from from using funds or programs are prohibited using CalMetForce funds for indirect costs. 75% of them go to benefits and salaries. And statutory funds must be used for GME costs as in accordance with the stat with the rules of and with these criteria put forth by UC Health as well. And then, Cal Med Force did Cal Med Force Plus did happen to award a cycle recently, funding for over 200 slots, new and expanding programs across 88 different specialties to 180 different programs, including one that was indeed a plastic surgery program.
This program serves over 60% Medi Cal indigent, dual eligible, and uninsured patients as well because I'm sure as everyone here can agree, Medi Cal recipients who've been to the who've had the experience of cancer, of burns, of physical trauma, or even congenital issues deserve to have a treatment as well. So thank you again for the time here, and we'd love to see a graduate of the Saint Saint Joseph's program as well and then the Cal Med Force program as well. Thank you.
Speaker 12
Good afternoon, chair and members. Omar Al Tammi here with CPEN, the California Pan Ethnic Health Network. Just wanted to touch very briefly on, something something that was already mentioned in the hearing on the volatility of existing funding. The the impacts of HR one in California's health care funding streams are are incredibly significant. Additionally, for years, proposition 56 has experienced waning returns that support health care costs for our most vulnerable populations.
These considerations, in addition to changes to the MCO tax as a result of HR one, are devastating to Californians. And and for that reason, legislators must look to raise new revenues this year in order to stabilize their health care system in the future. Thank you.
Speaker 22
Good afternoon, chair members. George Cruz on behalf of the California Behavioral Health Association. We represent community based behavioral health organizations and federally qualified health centers across the state, and our members contract with psychiatrists and other physician specialists every day. And the shortage is the shortage is acute. Communities are waiting months for appointments, and providers are competing across counties and systems for a limited pool of clinicians.
And too often integrated care teams are being built without the psychiatric capacity necessary to make them fully effective. So we're urging the legislature to expand the psychiatric residency slots including child and adolescent psychiatry, incentives for residency placements in community based and FQHC settings, and funding structures that align with integrated behavioral and physical health teams models and a long term sustainability beyond one year. Thank you.
Speaker 1
Thank you. And with that, we're gonna go to public comment for any items not covered on the agenda. I know we had one earlier from The Ukraine. There's yep. You're you're here.
I love it. I love it.
Speaker 16
I speak English only only two week in my life. Oh. Oh. I visit mama. She lives in a state in Ireland four years.
And these two weeks, I speak in English. I work a doctor in Ukraine. I help you speak today about medicine. It's good. And I help soldier in Ukraine too.
And I said our peoples, our soldier, our women, our children, today crazy, today strong, today happy, and we stop this war. Maybe with grizzly energy from Sacramento too. Thank you.
Speaker 1
Well, thank you so much, and, congratulations. We're we're just honored to have you here as a doctor from the Ukraine and appreciate you sitting through this hearing. Thank you. And with that, we will I don't see any other public comment for items not on the agenda, so we will adjourn this hearing. You
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