January 25, 2002
MERC Advisory Committee
Louis Ling - Chair, John Abenstein, Gary Anderson, Stephen Bolles, James R. Davis, Sandra Edwardson, Daniel Foley, Timothy Gaspar, Robert Howe, Jim Kohrt, Daniel Mareck, Kathy Meyerle, Carl Patow, Mary Edwards (substitute for Peter Rapp), Marilyn Speedie, Jim Toscano, and Cathy Wisner.
MDH Staff Present:
Julie Brunner, Marie Dotseth, Scott Leitz, Tom Major, Diane Marty, Diane Rydrych, Michelle Strangis.
Interested Parties Present:
Anna Geary, David Hagen, Pat Hanson, Larry Kuusisto, Gerhardt Meier, Beth Murphy, Beth Nunnally, and Jeny Stumpf.
I. Introductory remarks from MERC Advisory Committee Chair, Louis Ling
Dr. Ling opened the meeting at 1:10 p.m. and welcomed both committee members and visitors.
The following new members were introduced to the committee:
Dr. Stephen Bolles - Northwestern Health Sciences University, College of Chiropractic will serve as the replacement for Dr. Larry Kuusisto who will be leaving Northwestern Health Sciences University.
Dr. Larry Kuusisto was thanked for his term on the committee as representative for the chiropractic program.
II. PMAP Distribution Update: Diane Rydrych
Mr. Leitz informed the committee that the freeze on grants that had put a hold on the PMAP process has been lifted. A committee member asked whether PMAP funds were at risk due to the State's current budget deficit. Mr. Leitz responded that PMAP funds would not be in jeopardy.
Ms. Rydrych informed the committee that the contracts for the next PMAP distribution, which includes funds carved out between January and June 2001, are ready to send out today and that the contracts for the third distribution, which includes funds carved out between July and December 2001 should be ready within the next week. She asked the committee for a vote on whether to send out the second and third PMAP distributions separately or disburse them together to reduce the administrative burden on sponsoring institutions. The committee voted to have the two distributions distributed at the same time even if that meant a slight delay.
III. Update on the Governor's Budget Proposal
Julie Brunner, MDH Deputy Commissioner, spoke to the committee regarding the $2 billion budget deficit that the State is currently facing. She informed the committee that each state agency had been asked to submit proposals reflecting a reduction in the general fund budget by 10%, and that this reduction had to come from areas that would not affect the K-12 budget. Currently, approximately 21% of the MDH budget comes from the General Fund; this translated into a need for approximately $15 million in reductions in this biennium. Therefore, some programs need to be eliminated that do not have a state-wide benefit. MDH attempted to focus on ensuring funding for core public health programs, and focused recommendations for cuts on programs where the impact would be minimal on the program's overall funding stream and the program would still be able to run. MDH determined that the general fund contribution to MERC could be scaled back and the program could continue to operate due to ongoing support from other funding sources. The MDH proposal to the legislature was to cut $4.85 million from MERC.
A member asked if there was a possibility to still receive a federal match on the general funds being cut. Since the general fund allocation to MERC receives federal matching funds, members commented that the cut in the general fund allocation is in effect a double hit on MERC, resulting in a real loss to the MERC distribution of $9.7 million. MDH indicated that they did not think this is possible since the money will not be transferred into their budget for federal matching dollars.
Ms. Brunner informed the committee that if alternatives can be developed and proposed, they need to be done quickly. The $4.85 million cut is set in stone within the budget that the Governor will propose to the Legislature.
One member expressed concern that MDH proposed a large cut to MERC in a time when trends and data indicate current and future critical shortages of professional health care providers that could effect the quality of care. The member suggested that the cut in the General Fund allocation to MERC should be only temporary, that he hoped the Department would see the cut as a short term option, and that the Department would seek to restore the lost dollars in future years to ensure that the state makes progress towards resolving the medical education funding gap.
MERC staff handed out a spreadsheet to the members which showed the effect on the MERC and PMAP budget based on the proposed budget cuts. Members commented that MERC calculations should not include PMAP carveout dollars since the PMAP dollars are not new money to MERC but rather a reallocation of existing medical education dollars from elsewhere in the healthcare system. MERC staff agreed to distribute to Committee members a revised spreadsheet that would show PMAP carveout dollars separately from MERC funds.
The committee expressed their concerns regarding the funds MERC currently receives from the tobacco endowment and the chance that these funds could be redirected to help the state offset its current budget deficit. They indicated that the allotment to MERC from the tobacco endowment should be retained. Members noted that while other states are using the endowment for funds other than medical (e.g. roads and bridges), Minnesota is appropriately using these funds for public health and medical education activities. One member said that we need to identify key individuals within the Attorney General's Office, the Senate, and the House of Representatives who support how the tobacco endowment funds are currently allocated.
Mr. Leitz told the committee that MDH will help to play a role in preserving the endowment fund, but there is a line on what the Department can and can't do. A member asked if we can run other funds through MERC or whether that would require Legislative action. The reply was that it does take Legislative action.
The members of the committee all agreed that they view the $4.85 million cut to MERC as a temporary solution. Another member would like the department to suggest to the Legislature that the $4.85 million cut will be restored in > year X.' Members indicated that they do not want to settle for this cut on a continued basis.
As interested parties in the medical education community, the members of the committee unanimously support the decision to send a combined letter to the Commissioner which will relay their disappointment in the budget proposal. They will suggest that the proposed cut in the MERC General Fund allocation should be restored in 2004 and 2005 and that it is necessary to retain the allocation from the tobacco endowment rather than allowing the use of these funds for other purposes. Dr. Ling will write the letter on behalf of the full committee.
IX. Future Meetings Scheduled
- April 26, 2002
- June 21, 2002
- September 27, 2002
- December 6, 2002
All meetings are held from 1- 4 p.m. in the Veterans' Service Building in the fifth floor conference room.