84(R) - 2015
Relating to measures to support or enhance graduate medical education in this state, including the transfer of certain assets from the Texas Medical Liability Insurance Underwriting Association to the permanent fund supporting graduate medical education.
A fiscal note dated March 30, 2015 anticipates a negative two-year net impact to General Revenue Related Funds of $34,253,398 through the biennium ending August 31, 2017.
The fiscal note indicates that the bill could result in a revenue gain to the Permanent Fund Supporting Graduate Medical Education through a transfer of assets from the Texas Medical Liability Joint Underwriting Association, depending on the results of an actuarial study of the association. The bill does not make any appropriations but could provide basis for an appropriation of funds to implement the provisions of the bill.
The bill has been amended since we reported on it, and the
House Higher Education Committee introduced a committee substitute.
The Amendment, introduced on the Senate floor, would require
that immediately after the completion of the actuarial study, the commissioner
determine whether a necessity exists to suspend the association’s authority to issue
new insurance policies pending a future enactment by the legislature that
becomes law or the expiration of the subchapter, whichever occurs earlier. If
the commissioner was to decide that such a necessity exists, then the
association would have to stop issuing new policies immediately; otherwise, it
could keep on renewing policies in effect.
The committee substitute introduced by the House Higher
Education Committee would require that the board award additional grants to
fund eligible graduate medical education programs that, for the state fiscal
year ending on August 31, 2015, received a grant awarded under Section 58A.023
or 58A.024 or under Section 61.511, as that section existed immediately before
September 1, 2015, if those programs continue to meet the applicable grant
requirements that existed at the time of the initial award.
The committee substitute would also slightly alter the
research necessary to be conducted, removing the information needed on health
care needs for the state of Texas in terms of primary care vs. non-primary care
The committee substitute would also not repeal Section 58A.026
of the Education Code (relating to Grants for additional years of residency).
Senate Bill 18 would create a permanent fund supporting graduate medical education. This special fund would be in treasury outside of the general revenue fund and could receive money transferred or appropriated by the legislature, from gifts and grants and returns from investment of money in the fund. The Texas Treasury Safekeeping Trust Company would administer the fund.
Senate Bill 18 would also dissolve the Texas Medical Liability Insurance Underwriting Association. An actuarial study would be completed to determine the amount of assets necessary to fulfill the Association's obligations. The remaining assets not necessary to fulfill the Association's obligations would then be transferred to the permanent fund supporting graduate medical education.
The amounts in the fund could be appropriated to the Texas Higher Education Coordinating Board to grant money to hospitals, medical schools, and community-based, ambulatory patient care centers that would develop new graduate medical education programs with first-year residency positions or existing programs that seek to increase the number of first-year residency positions. New programs would be eligible to apply for additional funds under Section 58A.024 of the Education code for each first-year residency position established.
Grants could also be used to fill unfilled first-year residency positions that were unfilled as of July 1, 2013, and in this case, the grant should cover resident stipend and benefits and other direct resident costs to the programs. Grants would be awarded for as long as the resident who initially fills the position holds it.
When the number of positions offered by eligible applicants is greater than the number of positions for which grant funding is appropriated, priority would have to be given to medical specialties that are at critical shortage levels.
Senate Bill 18 would also require that the comprehensive health professions resource center conduct research on current health care needs for the state of Texas in terms of primary care and non-primary care physicians, medical specialties that are at critical shortage levels and in which areas of the state, as well as the ability of Texas' graduate medical education system to meet current and future needs.
Finally, Senate Bill 18 would repeal sections 58A.025 (Priority grants; adjustment of amounts), 58A.026 (Grants for additional years of residency), and 61.511 (Resident physician expansion grant program) of the Education code.
The second chamber sponsor is Representative John Zerwas.
Vote Recommendation Notes
The bill has been amended since we reported on it, and the House Higher Education Committee introduced a committee substitute.
Those changes, as updated above, do not fundamentally alter Senate Bill 18. We continue to remain neutral.
First chamber analysis below:
The State of Texas has a critical need to find a way to retain its medical students and to increase the number of physicians available to the growing population. One solution is to increase the number of first-year residency positions made available to medical students. Because there are currently not enough first-year residency spots available for all medical students in the state of Texas, many students that cannot find a residency position in Texas go to another state to complete their residency, and often never come back to Texas. This is a loss to the state of Texas.
Senate Bill 18 would try to remedy that problem by offering additional grants to medical programs that would create or add first-year residency positions. The amount available from the newly created fund would come from the remaining assets of the Texas Medical Liability Insurance Underwriting Association.
Because Senate Bill 18 doesn't seek new appropriations while trying to solve a real problem for the state of Texas, we will remain neutral on this bill.
An additional solution to the problem of a shortage of physicians facing a growing Texan population would be to consider expanding the scope of practice for other medical, including nurse, practitioners.