Fellows Rural Health Care Policy Report Final

Table of Contents

Executive Summary

Definition of Problem Page 2

Discussion of Background Page 4

History of the VLRP Page 4

Federal and Other State Programs Page 6

Similar Virginia Programs Page 7

Key Stakeholders Page 7

State Agencies and Commissions Page 7

Community Organizations Page 8

Higher Education Page 9

Policy Options Page 9

Recommendation Page 11

Implementation Timeline Page 12

Measuring Success Page 13

Maintaining VLRP’s Success Page 14

Costs versus Benefits Page 14

Further Recommendations Page 14

To: Governor Bob McDonnell, Chief of Staff Martin Kent, and CabinetFrom: 2013 Governor’s Fellows Michael Durst, Valerie Jama, Sadullah Karimi, Stacey LaRiviere, Brian Lee, Emily Pik, Judy Tat, Ryland Taylor, and Laura Young

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Date: July 31, 2013Re: Budget Proposal—Fund and Restructure Virginia Physician Loan Repayment Program in Virginia’s Rural Areas

Executive Summary

Throughout the Commonwealth of Virginia, there are citizens who do not have fair and equitable access to health care. This problem is especially pronounced in areas where there is a high patient to primary care physician ratio. These areas are disproportionally rural in nature. As a result, any effort to improve health care in these areas must address this overarching problem. Contributing to this high patient to physician ratio are a number of factors including: geography, an aging physician population, high numbers of uninsured patients, spousal employment, and medical school debt. In order to address some of these factors, we recommend restructuring and refunding the Virginia Physician Loan Repayment Program (VLRP) as a way to decrease the patient to primary care physician ratio and therefore improve access to health care in these areas.

The sizeable positive impacts of restructuring and refunding the VLRP will exceed the minimal costs of administering the program.

Definition of Problem

According to the Governor’s 2013 Rural Jobs Council Report, there is a documented lack of health care professionals, as well as mental health and dental providers, in rural localities. 1 Throughout both his campaign and his administration, Governor McDonnell has cited the necessity of providing greater access to rural health care professionals as a priority for his administration. Although practitioners of all types are needed, the Rural Jobs Council argues that the need for general practitioners is especially acute since the primary health concerns in rural areas pertains more to general care rather than specialized treatment.

As of 2010, there are currently 297 primary care physicians practicing within designated health professional shortage areas (HPSAs), and it is estimated that it would require an additional 103 physicians who agree to serve the medically needy in these areas to eliminate the primary care shortages that are currently being experienced within the Commonwealth.2

For the purpose of this policy recommendation, rural localities are those counties and cities that are not designated as parts of Metropolitan Areas (MAs) in the Commonwealth of Virginia, as defined by the Office of Management and Budget (OMB).3 These areas, denoted in this report as “rural localities,” tend to be communities in the Commonwealth that are predominantly agricultural, less populous, and generally have a lower standard of life.

The lack of primary care physicians in rural areas can be attributed to a variety of factors:

1 Governor’s Rural Jobs Council Report to the Governorhttp://www.governor.virginia.gov/ruraljobscouncil/docs/20130612RuralJobsCouncilFINALREPORT6-12-13.pdf 2 Healthcare Workforce Annual Report: July 1, 2009 to June 30, 2010, http://www.vdh.virginia.gov/OMHHE/policyanalysis/documents/RD227.pdf.3 Virginia Rural (Non-Metropolitan) Areas as Defined by the Office of Management and Budget (OMB), http://www.vdh.virginia.gov/OMHHE/primarycare/documents/rural/OMBDefinedRuralAreas.pdf.

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1. Geography is an important consideration when general physicians are deciding where to practice. Rural areas often are less appealing since the physician would most likely be the only general physician in the community, requiring the physician to take on large numbers of patients, ultimately placing a severe strain on the physician. This high doctor-to-patient ratio leads to retention issues.

2. Nearly 15 percent of Virginians under age 65 are without medical insurance, with the majority of uninsured being members of working families. Uninsured Virginians consequently do not receive the care they need.4 Rural residents in the Commonwealth particularly (24 percent) between the ages of 45 and 64 are more likely to be uninsured than urban residents (19 percent).5 The passage of the Affordable Care Act expands Medicaid eligibility to about 400, 000 of the one million uninsured residents in the Commonwealth.6 Physicians are less likely to accept Medicaid patients, causing an issue in attracting physicians to practice in rural localities. These circumstances do not appeal to practicing physicians with sizeable medical school loans.

3. Virginia’s physician population is aging. According to the 2008 Virginia Physician Workforce Survey, over 10 percent of Virginia’s active physicians are 65 or over. The rate of retirement will increase as 23.4 percent of physicians active in 2008 reach age 65 by 2018. Two-thirds of physicians in Virginia’s workforce in 2008 are over the age of 45. All of these physicians will be over the age of 65 by 2028.7 This aging is of greater concern to rural localities and will contribute to the dramatic decline in practicing physicians in the upcoming years.

4. Finding spousal employment is challenging in rural areas where job opportunities are more limited.8 This discourages general physicians from locating to rural areas. Additionally, it is important to consider the quality of life for the general physicians’ other family members. For example, if the physician had children, educational opportunities could be a major factor in deciding whether or not to practice in a rural area.

We recommend refunding a restructured version of the VLRP because this is a low cost, high impact program. Expending $750,000 of general funding is a much smaller cost to the state government to incentivize economic growth and improve the health of a community. In addition, the number of needed physicians is attainable if the VLRP is refunded and restructured. Our recommendation is the best option because even though there is little fiscal impact, the returns, which include improving access to health professionals and providing job opportunities, are great.

4 Profile of the Uninsured, http://www.vhcf.org/data/profile-of-the-uninsured/.5 Virginia Rural Health Plan, http://www.va-srhp.org/docs/plan/10-appendix-c.pdf.6 http://www.vplc.org/resources/affordable-care-act/7 Physician Forecasting in Virginia 2008-2030, http://www.dhp.virginia.gov/hwdc/docs/Physician2008/ForecastingSupplyAndDemand8-23-2010%20.pdf.8 Governor’s Rural Jobs Council Report to the Governor, http://www.governor.virginia.gov/ruraljobscouncil/docs/20130612RuralJobsCouncilFINALREPORT6-12-13.pdf

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Indirectly, refunding the VLRP will improve public health and the quality of life for rural residents. It is important to point out the beneficial economic impacts such an improvement in rural health care would create by bringing in more tax payers, both residential and commercial, as well as the job opportunities provided by physicians’ offices.

Discussion of Background

Approximately 19.2 percent of the U.S. population lives in rural America, only 11.4 percent of physicians practice in rural locations. The Bureau of Health Professions’ Office of Shortage Designation reports that in 2011, 65 percent of primary care health professional shortage areas were rural. Along the national recommendation that effective policy needs to be put into place in order to resolve these discrepancies regarding the shortage of health professionals in rural areas, the Commonwealth of Virginia would benefit from such policy as well.

The Commonwealth of Virginia consists of 95 counties and 39 independent cities, 65 percent of which are classified as rural. As of 2009, approximately one-third of the state’s estimated population resides in these rural areas. Today, this percentage equates to approximately 2.7 million Virginians.

History of VLRP

The existing Virginia Physician Loan Repayment Program (VLRP) as defined in the Code of Virginia offers medical school loan repayment for physicians who contractually agree to provide medical care for an agreed upon period of time in one of Virginia’s medically underserved areas. The U.S. Department of Health and Human Services designates a Medically Underserved Area (MUA) as a whole county or a group of contiguous counties, a group of county or civil divisions or a group of urban census tracts in which residents have a shortage of personal health services.9 The physician must provide primary health or psychiatric care during their term of service. This program has been administered by the Department of Health since 1999.10 A similar program, the Virginia State Loan Repayment Program (VSLRP), is federally funded to serve the same purpose “in a federally designated Health Professional Shortage Area (HPSA).” HPSAs are designated as having a shortage of primary medical care, dental or mental health providers. However, they may be urban or rural areas, population groups or medical or other public facilities.11 Each state that participates must match the funds received from the SLRP. A physician must serve for a minimum of two years and receives $50,000 maximum for those two years during the first year of full-time service. A physician may choose to extend his or her contract for an additional $35,000. The monetary amount received by the program participant from the state is in addition to any salary provided by an employer in the HPSA.12

9 Shortage Designation: Health Professional Shortage Areas & Medically Underserved Areas/Populations, http://www.hrsa.gov/shortage.10 Primary Care Workforce and Health Access InitiativesAnnual Report, http://leg2.state.va.us/dls/h&sdocs.nsf/By+Year/RD612004/$file/RD61.pdf.11 Shortage Designation: Health Professional Shortage Areas & Medically Underserved Areas/Populations, http://www.hrsa.gov/shortage.12 Primary Care Workforce and Health Access Initiatives Annual Report, http://leg2.state.va.us/dls/h&sdocs.nsf/By+Year/RD612004/$file/RD61.pdf.

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A 2007 study completed by an independent consultant indicated that both the VLRP and the VSLRP have “been very successful in improving both the short-term and long-term supply of physicians in underserved areas.”13 The study showed that as of 2007, 29 out of the 38 recipients of one of the two loans who had completed their obligation continue to work in Virginia. Of those who stayed in Virginia, 76 percent stayed in the same or a different medically underserved area.14

Despite these achievements, the program’s funding was reduced in 2009 from $830,964 to $50,000 and was split between the VLRP and VSLRP. Due to fiscal stress and budget cuts in the 2010 fiscal year, funds that were originally designated for the VLRP, which were not yet spent on pre-existing contracts, were returned to the general fund during the Kaine administration in order to provide funding elsewhere in the state budget. The Department of Health had some concerns with the existing VLRP program. The Department believed the amount of funding available was not enticing physicians to apply. The program remains in the Code of Virginia, but has not been funded since the 2010 fiscal year. As a result, the last VLRP recipient completed the program in 2012.

Although defunded, the VLRP remains popular as evidenced by the most recent General Assembly session. Delegate Christopher Stolle’s bill, HB 1588, would expand the medical professions covered by the VLRP and passed unanimously in both houses.15 The final vote on this bill shows that there is support for this program within the General Assembly. During deliberations over the bill, the Virginia Workforce Development Authority came out as decidedly in favor of both the bill and the program. Governor McDonnell signed the bill following its passage. However, funding for the program was not identified.

In 2009, then candidate Governor Bob McDonnell stated during his campaign his intent to offer assistance to the new Virginia Edward Via College of Osteopathic Medicine (VCOM) in Blacksburg and the Virginia Tech Carillion School of Medicine in Roanoke to train more doctors and nurses to practice in rural Virginia.

Following his election and inauguration, Governor McDonnell appointed the Virginia Health Reform Initiative Advisory Council to identify cost-effective and efficient reforms to improve health care throughout the Commonwealth. The Council recommended that the Secretary of Health and Human Resources should “restart and target state scholarship and loan forgiveness programs to specialties, residency choices, and geographic areas with the greatest unmet need.” Such areas of focus were expected to be in primary care. 16

13 Health Care Workforce Annual Report, http://www.vdh.virginia.gov/OMHHE/policyanalysis/documents/RD227.pdf.14 Primary Care Workforce and Health Access Initiatives Annual Report, http://leg2.state.va.us/dls/h&sdocs.nsf/By+Year/RD612004/$file/RD61.pdf.15 Legislative Information Serviceshttp://leg1.state.va.us/cgi-bin/legp504.exe?131+sum+HB158816Report of the Virginia Health Reform Initiative Advisory Council, http://www.hhr.virginia.gov/Initiatives/HealthReform/docs/VHRIFINAL122010.pdf.

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Although recognized as a major focus of health care reform, the state of the economy has limited the administration’s ability to refund such programs.

Federal and Other State Programs

The federal government has taken steps to address the ongoing rural physician recruitment and retention challenges. Three long-standing programs include Area Health Education Centers (AHECs), Federally Qualified Health Centers (FQHCs), and the National Health Service Corps (NHSC):

AHECs serve as community liaisons with academic institutions and help arrange ambulatory clinical training opportunities for health professional students, emphasizing participation in interprofessional training.

FQHCs are community-based and patient-directed organizations that provide comprehensive, culturally competent, quality primary care to populations with limited access to health care, many of which are in rural locations.

The NHSC provides scholarship and loan-repayment programs for both allopathic and osteopathic physicians and for other primary care providers practicing in underserved rural and urban areas.

o Since 1972, more than 37,000 health professionals have served in the corps, expanding access to medical, dental, and mental health care in shortage areas.

o The NHSC Loan Repayment Program offers fully trained primary care physicians (MD or DO) $60,000 to repay student loans in exchange for two years of full-time medical practice at a HPSA site. After two years, program participants may apply for additional years of support—up to $170,000 of loan repayment is available for five years of full-time service.

These programs received funding from the 2009 American Recovery and Reinvestment Act and the 2010 Patient Protection and Affordable Care Act.17

The Health Resources and Services Administration (HRSA), under the U.S. Department of Health and Human Resources, provides grant funding through the Bureau of Health Professionals to medical schools and residency programs for primary care curriculum development and clinical training in underserved localities, as well as opportunities in rural areas. Federal educational support comes from the Centers of Medicare and Medicaid Services (CMS). The Centers provide graduate medical education payments to residency programs, including family medicine residency rural training tracks.18

Nebraska

The state of Nebraska also currently runs a loan repayment program, which incentivizes working as a health professional in a rural locality. Practice sites eligible for loan repayment must be

17 Federal and State Initiatives to Recruit Physicians to Rural Areas, http://virtualmentor.ama-assn.org/2011/05/pfor1-1105.html.18 Ibid.

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located within shortage areas designated for each specialty by the Nebraska Rural Health Advisory Commission.

The Nebraska Loan Repayment Program is a local-state matching fund program to assist local entities serving shortage areas to recruit and retain health professionals. The health professional must agree to a three-year practice commitment and accept Medicaid patients. Leaving a shortage area prior to completing the three-year practice obligation will result in the health professional repaying 125% of the funds received through the program.

Physicians, dentists, and clinical psychologists may receive up to $40,000 per year ($20,000 from local funds; $20,000 from state funds). The actual amount awarded will depend on the individual practitioner's educational debt load and the availability of state funds. 19

Similar Virginia Programs

As described above, the Virginia State Loan Repayment Program (VSLRP) is a federally funded loan forgiveness program to a broader spectrum of health care practitioners than the state funded VLRP. In addition, unlike the VLRP, the VSLRP requires that the Commonwealth match any federal funds.

Key Stakeholders

An inter-agency approach is necessary for addressing rural health care needs in Virginia. While different interests may arise, each stakeholder has the potential to contribute in meaningful ways. All of the stakeholders and state agencies mentioned below will be impacted by the restructuring and refunding of the VLRP. Although some have expressed interest and support for providing more attention to rural health care, others cite the cost of the program as an unnecessary expense for the state. Establishing partnerships between these stakeholders will be instrumental in developing the health care industry in rural Virginia and sustaining the VLRP.

State Agencies/Commissions

Stakeholder RoleCommonwealth of Virginia Secretariat of Health and Human Resources (HHR)

Oversees twelve state agencies including the Department of Health Professions, which licenses health practitioners

Virginia Department of Health Professions Licenses health professionals, enforces standards of practice, and provides information to health care practitioners and the public

Commissioner's Health Workforce Advisory Committee (HWAC)

Advises the State Health Commissioner on all aspects of the Department of Health and Human Resource’s health workforce duties and responsibilities

19 State of Nebraska Loan Repayment Program for Rural Health Professionals, http://dhhs.ne.gov/publichealth/Documents/LR_INFO072011.pdf.

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Office of Minority Health and Health Equity (OMHHE)

Prepares annual report for Governor and General Assembly about activities (current and future) and utilization of program loans

Virginia Department of Health (VDH) Recruits and retains health care providers for MUAs and HPSAs

Virginia Health Workforce Development Authority (VHWDA)

Facilitates the development of a statewide health professions pipeline that identifies, educates, recruits, and retains a diverse, appropriately geographically distributed and culturally competent quality workforce for all Virginians

Virginia Recruitment and Retention Collaborative Team

Voluntary group of state agencies and organizations that focuses on collaborative efforts to deliver improvements in recruitment processes and retention systems for health care providers with an emphasis on MUAs in Virginia

Community Organizations

Stakeholder RoleVirginia Rural Health Association Improves the health of rural Virginians

through education, advocacy, and fostering cooperative partnerships

Virginia Community Healthcare Association

A nonprofit, statewide association representing more than 110 community/migrant health center sites and similar organizations

Virginia Association of Counties (VACO) Supports county officials and represents, promotes, and protects the interests of counties

Virginia Municipal League (VML) Statewide, nonprofit, nonpartisan association of city, town, and county governments that works to improve and assist local governments through legislative advocacy, research, education, and other services

Medical Society of Virginia (MSV) Professional association of more than 8,700 Virginia physicians, medical students, residents, physician assistants, and physician assistant students whose purpose is to advance quality health care throughout Virginia

State and Local Elected Officials Must approve the use of funds to support any health care related programs

Virginia Health Care Foundation A public-private partnership dedicated to increasing access to primary health for uninsured Virginians and those in underserved

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areas

Higher Education

Stakeholder RoleMedical Schools in Virginia Prepare and train students to become medical

professionals. Serve as a talent pipeline where recruitment and marketing will occur

State Council of Higher Education for Virginia (SCHEV)

Serves as the Commonwealth's coordinating body for higher education. Makes higher education public policy recommendations to the Governor and General Assembly in such areas as capital and operating budget planning, enrollment projections, institutional technology needs, and student financial aid

It is important to acknowledge that although all of these stakeholders are important to the process, some will be more supportive of the program than others. It is expected that the MSV, Virginia medical schools, SCHEV, and the VHWDA will support the VLRP as a way to improve health care in rural localities and as a means to reduce the high loans incurred by medical students. In light of the recent economic recession, special attention must be paid to the concerns of the state agencies, local and state elected officials, and organizations listed above. Although these stakeholders will acknowledge the positive benefits of the VLRP, their concern for the use of their limited resources must be acknowledged when designing and implementing the policy.

Policy Options

The first policy alternative available to the Governor is to make no substantial policy changes regarding the VLRP. Under this approach, the VLRP would remain in the Code of Virginia but would continue without funding. Although no additional funding is required, the long term costs of this approach in terms of large numbers of Virginians living without access to physicians can potentially lead to increased medical costs and negative effects on the workforce. Equity is also a major concern with this approach as those Virginians most in need of medical services will continue to have the most difficulty in accessing such services.

The second policy alternative, fully funding the existing VLRP as implemented prior to 2010, would address these equity concerns and would help improve the health of residents living in rural areas. However, the sustainability of this approach is in question as the program is a large investment of state resources and was defunded in 2010.

The third and fourth policy alternatives involve a restructuring of the VLRP in order to address the funding and sustainability concerns of the Governor, Department of Planning and Budget, and Health and Human Resources Office. Both alternatives would restructure the program as a partnership between the Commonwealth and the locality in which the loan recipients are employed. These localities then have the option to commit additional funding to the physician’s

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loan repayment as further remuneration for the physician’s ultimate three years of practice in the locality through a permissible arrangement. Participating physicians will receive $50,000 as compensation for three years of service to be paid out annually ($10,000 for the first year; $15,000 for the second year; and $25,000 for the third year) and used only for medical school loan repayment. Within the third year, the locality has the option to contribute additional funds to the loan repayment program as further remuneration to the participating physician practicing in that locality.

The Department of Health is responsible for working with the localities to identify whether additional local funding will be used. This will be an option provided to the local governments and the loan recipients and would result in a case-by-case renegotiation of the original contract. Under this alternative, medical students are more likely to apply for the extended VLRP program in exchange for more funding. Additionally, the sustainability of the program is enhanced since the Commonwealth is not the sole entity funding the program.

The third policy alternative would finance the Commonwealth’s contribution to the program using funds dedicated to the VLRP from the Commonwealth’s general fund. The Department of Health would be responsible for managing and funding the two-year program for each recipient.

The fourth policy alternative would utilize the same program structure changes as the third alternative, but funding would come from the Tobacco Indemnification and Community Revitalization Fund instead of the Commonwealth’s general fund. The Tobacco Indemnification and Community Revitalization Commission (TIRC) was established for distributing moneys in this fund to:

1. Provide payments to tobacco farmers as compensation for the adverse economic effects resulting from loss of investment in specialized tobacco equipment and barns and lost tobacco production opportunities associated with a decline in quota; and

2. Revitalize tobacco dependent communities.20

To date, the Commission has awarded 1,635 grants totaling more than $967 million across the tobacco region of the Commonwealth, and has provided $309 million in indemnification payments to tobacco growers and quota holders.21

A portion of the remaining funds can be used to finance the VLRP because health care is essential to the revitalization and economic sustainability of any community, especially those negatively impacted by the loss of tobacco-oriented industries. Although this option is the least costly as funds are being diverted from an existing source, the funds are only applicable to 41 tobacco-dependent localities.22 This reduces the scope and impact of the VLRP to Southwest and Southern Virginia instead of all rural MUAs.

AlternativesGoals Do Nothing Replace State/Locality State/Locality

20 Code of Virginia, § 3.2-3101. Tobacco Indemnification and Community Revitalization Commission created; purposes, http://leg1.state.va.us/cgi-bin/legp504.exe?000+cod+3.2-3101. 21 The Virginia Tobacco Indemnification and Community Revitalization Commission, http://www.tic.viginia.gov.22 Tobacco Commission Counties Southside and Southwest, http://www.tic.virginia.gov/tobmapupdated.shtml.

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funding to existing program

phase in using General Fund

phase in using Tobacco Indemnification and Community Revitalization funds

Increase number of medical professionals in “underserved” areas

4 3 1 1

Cost to Commonwealth

4 3 2 1

Equity 4 1 1 1Reduce costs of medical school to students

4 1 1 1

Sustainability 1 4 2 3Improved health in “underserved” areas

4 1 1 1

Number of areas reached

4 1 1 3

*1 being best; 4 being worst

Recommendation

Prior to the economic recession, the VLRP successfully placed primary care physicians in rural MUAs. The physicians benefited from loan forgiveness while the rural MUAs benefited from increased accessibility to experienced physicians. It is therefore recommended that Governor McDonnell include funding for the VLRP in his upcoming budget submission to the General Assembly. The Governor’s submission would model policy option three, as described above, and include the following criteria:

1. Refund the new VLRP as a pilot program in the localities considered rural under the OMB definition.

a. The pilot program will consist of 15 physicians who apply and are selected by the Department of Health.

i. The Department of Health will develop a formal application process as well as a list of appropriate localities for physicians’ placement, and match participants accordingly.

b. Participating physicians will receive $50,000 as compensation for three years’ of service to be paid out annually ($10,000 for the first year; $15,000 for the second year; and $25,000 for the third year), and used only for medical school loan repayment. Within the third year the locality has the option to contribute additional

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funds to the loan repayment program as further remuneration to the participating physician practicing in that locality.

c. Participating physicians must accept Medicaid patients.d. The new VLRP will come to an approximate total cost of $750,000 in its pilot phase.

The consideration of extra costs (e.g. administrative costs) is not included in this total.2. In light of the recent budget surpluses, $262 million for Fiscal Year 2013, Governor

McDonnell’s budget proposal will include provisions for the allocation of general funds to be set aside specifically for the VLRP.

a. Resources will be taken from this fund to compensate the participants.b. Any participating physician who does not fulfill the terms of the contract will repay

125 percent of any distributed funds back to the VLRP fund as a penalty.

Implementation Timeline

Measuring Success

In order to determine if the VLRP achieves the desired goals, it is important to continuously track program outcomes to ensure success and identify areas for improvement. A triple bottom line should be incorporated into the performance measures to gauge how sustainable the program is and its social impact. The three pillars of the triple bottom line include People, Place, and Profits:

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6 months - 1 year

Develop an application process and draft contract terms for participating physicians

Select 15 physicians from applicant pool

Identify the potential rural MUAs for placement; match participants accordingly

Establish program performance measurements

2 - 3 years

Place physicians and begin their contracted service time

Monitor physicians' progress through first-hand feedback from both physicians and rural residents

3 -5 years

Draw conclusions regarding retention and continuity based on stakeholders' feedback

Evaluate VLRP's results in respect to the program proposal's goals and the areas' needs

Make improvements as necessary (funding, participants, areas affected, etc.)

1. People : Reinstating the VLRP along with additional structural improvements has the potential to increase access to care by improving the patient to physician ratio in rural areas.

2. Place : Since many rural residents participate in the agricultural, technological, and manufacturing sectors, making sure that they have access to health care will translate into greater productiveness in existing jobs. For example, Virginia’s economy depends on farmers and rural residents for their contributions to the agricultural and forestry industry, which contributes over $79 billion to the Commonwealth’s economy. Additionally, physicians’ offices will provide job opportunities for rural residents. This economic growth will further incentivize primary care physicians to relocate in rural Virginia.

3. Profits : Healthier individuals are more likely to hold a steady job, thus generating higher household incomes. More disposable income leads to greater spending, which has positive implications for both the Commonwealth’s economy. This is also linked to wealth creation in rural communities, transforming the locality into a more attractive area for investors to relocate.23

Several Key Performance Indicators (KPIs) have been identified to help determine program effectiveness:

1. Placement : The number of primary care physicians that are placed in rural areas after graduating from medical universities and completing their residencies.

2. Retention Ratio : The number of those physicians that serve in rural MUAs who stay in the same MUA when the VLRP contract terminates. It is recommended that this measure is tracked every two years, due to the budget cycle.

3. Patient per Physician Ratio : This figure should decrease over time, i.e. from 200:1 to 100:1. It is suggested that this measure is tracked every two years as well.

Maintaining VLRP’s Success

It is expected that reinstating and restructuring the VLRP will result in better health care for rural areas and a lower physician to patient ratio in these areas. The VLRP is envisioned as a sustainable, continuous program that exists beyond the upcoming budget cycle. As a result, it is important to build on the initial success of the program so that the loan recipients do not all leave the rural communities after their three-year contract is over. This would result in the citizens having sporadic health care as the physicians filter in and out.

The risk to the VLRP is getting defunded again come the next economic recession. Using the KPIs discussed above, the VLRP will be self-sustaining and achieve its performance measures. In addition, there is documented support from the stakeholders listed above, who recognize the

2325 Secretary of Agriculture and Forestry, http://www.ag-forestry.virginia.gov/.

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need and positive benefits from this program. Continuing to garner such support is essential for the sustainability of the VLRP.

Costs versus Benefits

It is anticipated that results from refunding and restructuring the VLRP will positively exceed those of the original VLRP. Rural MUAs will benefit from such a program, as it will provide a positive economic impact on communities struggling with high unemployment rates and low average household incomes. This has been seen with the Virginia Community Healthcare Association CHCs, which the VLRP can work in conjunction with.

As with any state-funded program, the monetary costs come directly from the Commonwealth of Virginia and its citizens. As mentioned, this funding mechanism suggests using finances from the general fund. We do not propose using the Commonwealth’s surplus in its entirety, but rather a sum that would jumpstart the trial run of a restored loan forgiveness program for primary care physicians in rural localities.

Significantly, refunding the VLRP will assist in preventive care in rural localities. Eighteen percent of Virginia’s GDP is spent on Medicaid each year. This number is expected to rise as the population of Virginians age 60 and older is expected to grow to almost 25 percent by 2025, when there will be more than two million Virginians. Having more physicians in rural MUAs will result in improved wellbeing in those areas. Once physicians begin working under the restructured VLRP, preventive care will reduce future costs incurred by the state for expensive treatments and surgeries. By spending less on Medicaid each year more money can be invested to other parts of Virginia’s economy such as agriculture, technology, and education.

Further Recommendations

1. It is recommended that the Commonwealth undertake a multiple secretariat initiative to develop a clear and consistent definition for rural areas as well as medically underserved areas.

2. It is recommended that the Commonwealth identify means to increase the number of residency positions available to medical students by partnering with public and private universities.

3. It is recommended that the Department of Health reach out to community college students from the rural localities to enlist them as nurses and other medical personnel.

4. It is recommended that the Department of Health develop avenues to create team based care with the VLRP.

5. It is recommended that the Department of Health create partnerships with medical universities to increase awareness of rural health care needs.

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Fellows Rural Health Care Policy Report Final

Documents

Transcript of Fellows Rural Health Care Policy Report Final