2005 Legislative Compendium: Medical Education/Workforce


State Graduate Medical Education Funding  |  Medical School Expansions  |  Primary Care and Rural Practice Incentive Programs  |  Town/Gown (Budget RiderFaculty Practice Plans (Budget Rider)  |  Efforts to Increase Medical School Diversity  |  Continuing Medical Education Update   |  Medical Education/Workforce Close Calls  

State Graduate Medical Education Funding

Graduate medical education (GME) funding was viewed as a priority for the session after receiving considerable focus by several legislative workgroups during the 2004 legislative interim period. There were mixed results for GME this session: Legislators approved the first-ever state GME formula funding process but also were unwilling to finance Medicaid GME with general revenue funds, instead setting up a system of funding that is not expected to yield results.

GME Formula Funding
The formula process allows $4,806 to be allocated per resident in an accredited program but provides funding for only half of this, or $2,403 per resident. The funds are to be spent increasing the number of resident slots as well as faculty costs relating to GME. Obtaining formula funding for GME is a major accomplishment, at least eight years in the making. Legislators have been interested in doing this in the past but were reluctant to use formulas to drive GME funding due to a lack of understanding of GME revenue sources and costs. The coordinating board addressed these issues at length during the 2004 interim period through a study and an orientation process on medical education for key legislators. This combined with subsequent lobbying efforts apparently overcame longstanding barriers to adoption of a state GME formula funding process.

The coordinating board's three existing GME funding programs also remain intact, as shown below. Each was cut 5 percent from the 2004-05 biennial levels, resulting in a combined total of $26.1 million.




2002-03 State Approps.  

2004-05 State

2006-07 State

Family Medicine Residency







Primary Care Residency











Resident Physician Compensation Program











It's important to note, however, that the additional $25 million authorized for GME formula funding will bring the overall total for the coordinating board's GME programs to $51 million for the next biennium, effectively restoring the legislative funding cuts of 2003.

Medicaid GME Funding
Rider 30, Article II, authorizes the Texas Health and Human Services Commission (HHSC) to spend $205 million in Medicaid GME funds during the next biennium. This is considerably higher than the estimated $65 million per year paid in Medicaid GME funds before the 2003 legislative cuts. Public teaching hospitals are directed to provide the state portion of these funds to qualify for a federal match; however, the Association of Public and Non-Profit Hospitals reports that many of these hospitals are limited in their ability to do so because they already have reached their maximum potential to bring down federal matching funds through participation in the Medicaid Upper Payment Limit and Disproportionate Share Hospital programs. Further, county governmental authorities are concerned that what they view as state funding responsibilities are being delegated to the local level.

HB 2420 by Rep. Norma Chavez (D-El Paso) and Sen. Eddie Lucio (D-Brownsville) directs the HHSC to consider the growth in GME slots in the Lower Rio Grande Valley and other health care shortage areas when allocating Medicaid GME funds. The original version of this bill would have established a separate Medicaid GME funding process for hospitals that met a very narrow definition which only Valley Baptist Hospital, Harlingen, appears to meet at this time. The bill was changed to remove this provision before it was adopted. GME slots at Valley Baptist were established after a 1996 freeze on Medicare-supported GME slots went into effect. This bill may have little effect, however, if Medicaid GME funds are not available.

Additional State GME Funding
An additional aggregated total of about $24 million in GME funding is included in the budgets for four health-related institutions for 2006-07. Seven of the nine programs received continued funding ($7.5 million), and two are new programs ($16.5 million).


2006-07 State Appropriations  

Texas Tech Univ. Health Sciences Ctr.  



Midland OB/Gyn GME & Physician Assistant Prog. (New):

Medical Residency & PA Expansion Program (New):$3,000,000

Midland Surgical GME:



Midland Cardiology GME:



Fam./Com. Medical GME:



Border Health-Resident Support:



UT Health Center, Tyler  

Fam. Prac. GME:





UT Southwestern Med. Ctr., Dallas  

Prim. Care GME:





UTHSC-San Antonio  

Fam. Med. GME:





State Total:















SCR 27 by Sen. Royce West (D-Dallas) and Rep. Dan Branch (R-Dallas) encourages Congress to eliminate caps on funded Medicare GME slots. TMA policy supports removal of the caps. This resolution was an outgrowth of the 2004 legislative interim period when both sponsoring legislators served on interim workgroups that studied the status of GME funding. The number of GME slots eligible for Medicare funding is frozen at 1996 levels at a time when many policy-making bodies, teaching hospitals, and medical schools support expanded GME training to meet growing physician workforce needs. Medicare is the largest payer source for GME, and the current freeze has had a detrimental effect on physician training.

Future Funding
HB 3001 by Rep. Geanie Morrison (R-Victoria) and Sen. Robert Duncan (R-Lubbock) specifies annual funding, beginning with the fiscal year ending Aug. 31, 2008, for specific state universities and colleges, including the University of North Texas Health Science Center at Fort Worth and Texas Tech University Health Science Center.

Medical School Expansions

El Paso Medical School
Texas Tech University System gained legislative approval in 2003 to convert the two-year El Paso Regional Academic Health Center (for third- and fourth-year medical students) to a four-year medical school. Approval was also granted for the pursuit of bonds to finance construction of new classroom and research buildings. This session, the system asked for $68 million in state funding to cover debt service on the bonds and to allow additional faculty to be hired. Instead, the legislature approved about $7 million: $5 million in special item funding to cover the bond debt service and $1.6 million for infrastructure support, faculty salaries, maintenance and operation, and library resources. Gov. Rick Perry expressed support for additional funding to hire more faculty, and the university system is optimistic about this prospect.

Lower Rio Grande Valley Regional Academic Health Center, Harlingen and McAllen
Lower Rio Grande Valley Regional Academic Health Center (RAHC) in Harlingen and McAllen also is an extension campus with clinical training programs for third- and fourth-year medical students from UT Health Science Center-San Antonio. RAHC received $8,437,500 for each year of the next biennium, for a combined total of $16,857,000. Once again, Senator Lucio filed a bill (SB 721) to expand RAHC to a four-year medical school, but it was never heard in committee.

Texas Tech University Health Sciences Center, Lubbock
Texas Tech University Health Sciences Center (TTUHSC) received continued authority to increase first-year medical school enrollment by an additional 20 students until first-year enrollment reaches 200. This is the third biennium that TTUHSC has received legislative approval to increase its medical school class to 200 students. Current enrollment stands at 150.

Decrease in State Formula Funding for Undergraduate Medical Education
State funding for medical education has been allocated on a per-capita formula basis since 1999. The formula's base unit was slightly increased by the legislature for the next biennium from $9,934 to $10,987, an increase of 10.6 percent. An additional weight of 4.753 per medical student remained unchanged from previous state budgets. This increases the state appropriation per medical student to $52,221 for the next biennium compared with $47,216 for the current biennium. While the increase is favorable, it falls 7 percent short of the 2002-03 base unit of $11,776, and per-student appropriation of $55,971. Study committees appointed by the Texas Higher Education Coordinating Board are to review and recommend future formula updates by June 1, 2006.

Primary Care and Rural Practice Incentive Programs

  • Funding for three primary care preceptorship programs.  Family practice, general internal medicine, and general pediatrics were cut 5 percent, for a total of $452,144 per year ($904,289 for the biennium). These programs, which are designed to cultivate interest in primary care careers among medical students through preceptorships with community physicians, suffered a 50-percent cut in 2003.
  • Family practice rural and public health rotations.  Of the $8,732,155 per year appropriated for the Texas Higher Education Coordinating Board's Family Practice Residency Program, $363,000 per year is to be designated for one-month rural or public health rotations for family medicine residents.
  • State Physician Education Loan Repayment Program.  Approximately $2.5 million is expected to be available for the State Physician Education Loan Repayment Program. This program has been one of the state's most successful initiatives for recruiting and retaining primary care physicians in underserved areas. Interest in the program has exceeded available resources in recent years.

HCR 140 by Representative Branch honors the valuable role medical students, medical schools, resident physicians, and teaching hospitals play in providing for the health care needs of our state. This was adopted to recognize and welcome these groups on the first Tuesday of April 2005 - the date TMA designated as the special lobbying day for medical students and resident physicians at the Texas Capitol.

Town/Gown (Budget Rider)

Health-related institutions cannot use state appropriations to replace or duplicate services provided by Driscoll Children's Hospital, including pediatric cardiovascular diseases.

Faculty Practice Plans (Budget Rider)

As in the past, medical schools are required to file an annual report on the use of practice plan funds within 120 days following the end of the state fiscal year; otherwise, state appropriations become frozen, and the institution cannot use them.

Efforts to Increase Medical School Diversity

SB 1247 by Senator West and Rep. Fred Brown (R-College Station) authorizes administrative changes to the Joint Admission Medical Program (JAMP), which seeks to increase access to medical education for economically disadvantaged, including minority, students. The new law will delay entrance into the program from the freshman year of college to the sophomore year to allow students to get better established in college and have more specific career goals. The changes should improve the student success rate for this program. TMA has policy in support of JAMP.

The undergraduate medical academy at Prairie View A&M University in Prairie View is scheduled to receive $1.28 million per year in the next biennium from the Office of Civil Rights Priority Plan. The academy was created last session by a bill authored by Rep. Ruth Jones McClendon (D-San Antonio), with the goal of expanding the minority medical school applicant pool.

Conti n uing Medical Education Update

SB 39 by Sen. Judith Zaffirini (D‑Laredo) and Rep. Tony Goolsby (R-Dallas) allows physicians whose practice includes treating patients in an emergency room setting to complete two hours of continuing medical education (CME) on forensic evidence collection for purposes of meeting the Texas State Board of Medical Examiner's (TSBME's) requirements for CME. The original version of this bill would have required physicians meeting this definition to take the CME; however, it was reduced to an optional CME topic in the final hours of the legislative session. TSBME is directed to adopt rules to establish content on this type of CME course by June 1, 2006. TSBME has said that it expects this bill will have little impact because the CME is not required. TMA policy does not support content‑specific CME mandates but gives preference to physicians having the latitude to select CME topics that best meet their individual needs.

The Board of Nursing Examiners is directed to determine which nurses are required to obtain the same type of continuing education and to determine the content.

A similar bill was filed last session and was backed by rape victim support groups with the goal of improving the collection of forensic evidence by health care professionals in sexual assault cases.

Medical Education/Workforce Close Calls

HB 1709 by Rep. Roberto Alonzo (D-Dallas) would have reduced postgraduate training requirements for international medical graduates from the current three years to one year.




Among its many provisions, SB 67 by Eliot Shapleigh (D-El Paso) would have transferred $200,000 in state funding per biennium from the Texas Health Service Corps to a newly created Border Health Corps. The Office of Rural and Community Affairs oversees the Texas Health Service Corps, which provides $15,000 per year to residents in primary care training programs as an incentive for practicing in underserved areas of the state upon completion of training. The Border Health Corps would have provided education loan repayment to health profession students who agreed to practice/work in a border community following completion of training.

Medical Education/Workforce TMA Staff Contacts:  

  • Hilary Dennis, Legislative Affairs, (512) 370-1370
  • Marcia Collins, Medical Education, (512) 370-1375




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