A Statutory Review of

Family Practice Clerkship

Office of the State AuditorLawrence F. Alwin, CPA

January 1995 Report No. 95-042

OFFICE OF THE STATE AUDITORTWO COMMODORE PLAZA206 EAST NINTH ST., SUITE 1900AUSTIN, TEXAS 78701

MAILING: P.O. BOX 12067AUSTIN, TEXAS 78711-2067

PHONE: (512) 479-4700 FAX 479-4884

LAWRENCE F.ALWIN, CPAState AUditor

SHARON W. COBB, CPAFirst Assistant

January 18, 1995

Members of the Legislative Audit Committee:

The eight Texas medical schools are in compliance with the Family Practice Clerkship fundingprovisions of the General Appropriations Act (Senate Bill 5, Article III, Section 36, 73rdLegislature).

These institutions are graduating additional physicians who have selected family practice as theirresidency choice. Since 1991, that percentage has increased from 13 percent to 19 percent. Inaddition, the number of graduates choosing Texas as the location of their residency is alsoincreasing.

Each of the schools has expended the funds required by the Act for fiscal year 1994. Additionally,family medicine departments have implemented systems to ensure that funds available for theclerkship do not reduce funds available to other areas of family medicinedepartments. Further, eachschool has established a curriculum and administers an exam to each student in the clerkship.

The administration at each of these institutions concurs with the results of our review. We haveincluded a response from the Family Practice Advisory Committee of the Texas Higher EducationCoordinating Board within the body of the report.

We appreciate the cooperationand assistance of each institution's administration in conducting ourreview.

Sincerely,

Lawrence F. Alwin, CPAState Auditor

LFAzrrnn/enclosure

Key Points Of Report

A Statutory Review OfFamily Practice Clerkship

January 1995

Key Facts and Findings

• The eight Texasmedical schools are In compliance with the Family PracticeClerkship funding provisions of the General Appropriations Act (Senate Bill 5,Article III, Section 36, 73rd Legislature).

• The overall percentage of graduating physicians In Texasselecting FamilyPractice as a residency choice has increased from 13 percent to 19percentsince 1991.

• For 1994,all eight medical schools had expenditures for the Family Practiceclerkship exceeding the amounts defined by the Legislature.

• Family medicine department bUdgets at seven medical schools haveIncreased since the implementation of the required clerkship In 1992.

• All eight medical schools have an established curriculum and require that anexam be administered for the clerkship.

Contact:Catherine A. Smock, CPA, (512) 479-4775

This compliance review of Family Practice Clerkship funding provisions was conducted inaccordance withSenate Bill5, ArticleIll, Section 36 of theGeneral Appropriations Act, 73rdLegislature, and Section 37 of the General Appropriations Act, 72ndLegislature.

Table of Contents

Issues · . · · . · · · · · · · · · · · · · · · ·

Section 1:

The Eight Texas Medical Schools Are GraduatingAdditional Physicians Who Have Selected FamilyPractice As Their Residency Choice . . . . . . . . . . . . . . . .. 1

Section 2:

Expenditures ForThe Clerkship At Each School AreSufficient To Meet The Minimum Levels Required ByThe Legislature 2

Section 3:

Each School Has Implemented Systems To EnsureThat Funds Allocated ForThe Clerkship Do NotReduce Funds Available For Other Activities In TheFamily Medicine Department . . . . . . . . . . . . . . . . . . . . . .. 3

Section 4:

There Is A Curriculum Established And A RequiredExamination Administered ForThe Clerkship AtEach Medical School · . · .. 3

Appendix 1:

Objective, Scope, And Methodology 5

Appendix 2:

Texas Higher Education Coordinating BoardResponse 6 J'.,

Appendix 3:

Statutes Requiring Family Clerkship Funding . . . . . . . .. 7

Issues

T he eight Texas medical schools are in. compliance with the Family Practice

Clerkship funding provisions of the GeneralAppropriations Act (Senate Bill 5, Article III,Section 36, 73rd Legislature).

Section 1:

The EightTexas MedicalSchools Are GraduatingAdditional Physician WhoHave Selected Family PracticeAs Their Residency Choice

The overall percentage of graduatingphysicians in Texas selecting Family Practiceas a residency choice has increased since 1991from 13 percent to 19 percent. With theinception of a required family practiceclerkship in fiscal year 1992 (see Appendix 3for the legislation), the eight Texas medicalschools have taken steps toward the State'sgoal of providing family practice physicians tounserved and underserved areas of the State.The Texas Legislature stated in 1992 that "atleast 25 percent of the first year residencypositions [in Texas] be devoted to familymedicine" [V.T.C.A., Education Code,Section 51.918(d)(I)]. Thus, the currentpercentages are a measure of whether theschools are making progress in achieving thisbenchmark. Between 1992 and 1994, seven ofthe eight schools showed an increase in theirnumber of family practice graduates. ,

The number of physicians choosing a familypractice residency in Texas has also increasedoverall from 93 (8 percent of graduates) to 140(12 percent of graduates) during the sameperiod. The location graduates choose fortheir residency is strongly correlated to thelocation where they ultimately practice,according to the Texas Academy ofFamilyPhysicians. Therefore, the number of medical

graduates choosing a Texas residency is a keyfactor in Texas achieving its goal.

Some incentives are currently in place toencourage students to make Texas theirresidency choice in family medicine.However, it is unclear whether sufficientresidency sites exist in Texas to accommodateall medical graduates who might wish to entera family practice residency in the State.

In 1994, the range of class graduates choosingfamily practice residencies in Texas variedfrom 3 percent to 34 percent among the eightmedical schools. There are several reasons forthis significant variation. Each institution hasa unique mix of program emphases asaddressed in the mission of the school. Asnoted by the Family Practice AdvisoryCommittee of the Texas Higher EducationCoordinating Board, this can influence thenumber of graduates selecting family practiceas a specialty.

Though the numbers of graduating familypractice physicians in Texas is generallyincreasing, it should not be concluded that theclerkship is the only factor impacting thisincrease. A number of other factors should beconsidered. Most notably, the trend towardmanaged health care is beginning to create aneconomic demand for family practicephysicians. Additionally, the number ofgraduates ultimately selecting family practiceas their specialty can be influenced by thecomposition of school admissions committeesand their recruiting policies.

JANUARY 1995A STATUTORY REVIEW OF

FAMILY PRACTICE CLERKSHIP PAGEl

~ Issues

Family Practice Residency ChoicesFor Texas Graduates

25 -.r----------------.

10041003

o Outside TexasI1092

1_'nTexas

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j20 - ----.---------------------------.----------!~ 15 - -------. --------- -.- -------~ ~~n~as Rider~ 10 - --

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Section 2:

Expenditures For The ClerkshipAt EachSchool Are SufficientTo Meet The ,Minimum LevelsRequired ByThe Legislature

For 1994, all eight medical schools hadexpenditures for the family practice clerkshipexceeding the amounts defined by theLegislature. The expenditures in 1994 rangedfrom approximately $29,000 per student to$2,000 per student. Total expenditures perstudent in 1993 ranged from approximately$16,000 to $1,200 per student. The range inexpenditures can be attributed to the nature ofinstitutional focus, per capita administrativecosts of operating the program, and thevarying size of the schools' enrollment.

for 1994, no testing was performed onexpenditure data for 1993.

For 1993, three schools spent fromappropriated funds at least the amountdirected by the Legislature for the clerkship.Of the five schools that did not, four of thoseschools met the targeted requirement byexpending funds from other non-appropriatedsources such as grant funds and institutionalfunds.

The Family Practice Clerkship rider waschanged between the 1992-1993 and 1994­1995 biennia allowing the schools moreflexibility in funding clerkship expenditures.The budgeting process at any medical schoolconsists of optimizing the mix of stateappropriations, discretionary funds, federalgrants, and practice plan revenues.

The statute has no requirement as to how theclerkship funds are to be spent. However,schools generally expended or allocated fundsfor faculty salaries and benefits, travel andhousing for clerkship students at practice sites,computer equipment and software, andadministrative support. In testing for thereasonableness of expenditures, no exceptionswere noted. Because there were no issuesregarding the reasonableness of expenditures

In fiscal years 1992 and 1993, the statuterequired that expenditures come only fromstate-appropriated funds. The statute waschanged the following biennium to allowexpenditures from any combination ofappropriated funds, restricted grant funds, orinstitutional funds for fiscal years 1994 and1995.

PAGE 2A STATUTORY REVIEW OF

FAMILY PRACTICE CLERKSHIP JANUARY 1995

Issues

Volunteers from throughout the medicalcommunity currently provide in-kind supportat five of the eight medical schools. Mostprominently, physicians from localcommunities serve as preceptors for thestudents in the clerkship to provide an array ofclinical and patient interaction experiences.

Section 3:

Each School HasImplemented Systems ToEnsure That Funds AllocatedForThe Clerkship Do NotReduce Funds Available ForOther Activities In The FamilyMedicine Department

Family medicine department budgets at sevenmedical schools have increased since theimplementation of the required clerkship in1992. The Legislature, in creating the statute,wished to ensure that although additionalfunds were not appropriated to the schools forthe clerkship, the schools would not reducetheir family medicine budget in otherprograms to fund the clerkship. The allocationto the clerkship was to be an additionalenhancement to family medicine departmentbudgets.

Accounting systems have been developed totrack the source of clerkship funds and theassociated expenses. During a review of theFamily Practice clerkship conducted by theState Auditor's Office for fiscal year 1992, itwas recommended that' tt ••• the source offunding and the procedure for allocation[should be] clearly specified" (FamilyPractice Clerkship Review, SAO Report No.3-039, page 1). Four of the eight medicalschools conducted internal reviews of theclerkship in fiscal year 1993 to determine ifthe internal controls (policies and procedures

addressing risks) over the clerkship wereadequate. Based on the results of thosereviews, recommendations were made toimprove the systems which track expendituresfor the clerkship. Strong emphasis was placedon improving the allocation system fortracking faculty salaries.

Where clerkship expenses are not trackeddirectly, a reasonable allocation system existsfor the accumulation of data in support ofexpenses. Since 1993, all eight medicalschools have developed appropriate trackingsystems for the allocation of faculty salaries.For the family practice clerkship, facultysalaries clearly represent the highestpercentage of expense within each budget. Onaverage, faculty salaries have accounted for48 percent to 70 percent of clerkshipexpenditures annually. Although there iscurrently no uniform format for this allocationprocess, a review of each school's allocationmethodology showed a reasonable andmaterially accurate approach.

Seven of the eight medical schools integratethe accounting for family practice clerkshipwith the family medicine department's generalledger system. Although not a specificrequirement of the statute, these schools nowtrack clerkship expenditures through theiroverall accounting process. This enhances theoverall monitoring and control of theexpenditures and increases accountability.

Section 4:

There Is A CurriculumEstablished And A RequiredExamination Administered ForThe Clerkship At Each MedicalSchool

As required for 1994, all schools have anestablished curriculum for the clerkship in the

JANUARY 1995A STATUTORY REVIEW OF

FAMILY PRACTICE CLERKSHIP PAGE3

Issues

PAGE 4

third year of medical school training varyingin length from 4 to 16 weeks. Each school hasformalized its curriculum format althoughthere are no requirements in the statute foruniform course content.

Also, all schools require the administration ofan examination for all students participating inthe clerkship. The purpose of including theexamination requirement was to ensure thedifferentiation between the clerkship andprevious voluntary, non-compulsorypreceptorships.

A STATUTORY REVIEW OFFAMILY PRACTICE·CLERKSHIP JANUARY 1995

Appendices

Appendix 1:

Objective, Scope, AndMethodology

The objective of this audit was to reviewcompliance by the eight Texas medicalschools with Section 37 (fiscal year 1993) andSection 36 (fiscal year 1994) with regard tothe establishment and implementation of afamily practice clerkship in the third year ofmedical school training.

To determine compliance by each institution,we reviewed and examined:

• each institutions' response to oursurvey regarding their activities insupport of the clerkship

• general ledger and allocation detail forclerkship expenses

• source documents associated withexpenditures, funding, curriculum,and examinations

We analyzed funding and expenditure data toidentify areas of compliance and trends.

We compared data provided by the schoolsregarding graduating physicians with datasupplied by the Board of Medical Examinersto the Texas Higher Education CoordinatingBoard.

The audit was conducted in accordance withgenerally accepted government auditingstandards and in conjunction with the TexasHigher Education Coordinating Board.

This review was completed by the followingmembers of the State Auditor's staff:

• Kathleen M. George (ProjectManager)

• Greg D. Lee, CPA (Team Member)• Catherine A. Smock, CPA (Audit

Manager)• Craig D. Kinton, CPA (Audit

Director)

JANUARY 1995A STATUTORY REVIEW OF

FAMILY PRACTICE CLERKSHIP PAGE 5

Appendices

Appendix 2: TEXAS HIGHER EDUCATION

COORDINA.TING BOARDP.o. Boz 12788 • Austin, TUGS 78711

---------HEALTH AFFAIRS DIVISION--------­Family Practice Residency Program

Stacey B. Silverman, Associate Program Director512-483-6206 • FAX 512-483-6264

January 4, 1995

Katie GeorgeProjectManagerOffice of the State AuditorTwo Commodore Plaza206 BastNinth Street, Suite 1900Austin, TX 18701

Dear Ms. George,

I am supportive of the FamUy Practice Qerkship Review draft summary. I realize this is beingreviewed and commented on by medical school deans and some generalist physicians.

I am impressed with the recent increase of graduates from Texas medical schools enteringFamily Practice. I realize that positive changes in national IIHealth Care Reform" for generalistphysicians may contribute to this increase but I suggest that implementation of Article m, Rider37 ofthe General Appropriations Act, 72nd Legislature mandating third year clcrkships it; amajor cleterminant. The enclosed article from the Journal of the American Medical Association(September 7, 1994) entitled "Medical School and Shldent Characteristics that Influence aGeneralist Career" clearly supports this contention.

I am also sad to admit that the number of retiring general and family practitioners in Texas maysurpass our current graduates from Texas Family Praeticeresidency programs to replace them.This further supports the wisdom of the Texas Legislature and the Texas Higher EducationCoordinating Board to monitor and nurture methods such as the third year clerkships in familypractice that might reverse this awesome trend.

Best Personal Regards,

~~&1uJu~Samuel i.Coleridg~, FACEP, FACOEPChairmanJ1amily PracticeAdvisory Committee

Enclosure

Located at 7745 Chevy Chase Drive, Building V,AU8~ Texas

AN EQUALOPPORTUNITYEMPLOYER ANDSERVICEPROVIDER

PAGE 6A STATUTORY REVIEW OF

FAMILY PRACTICE CLERKSHIP JANUARY 1995

Appendices

Appendix 3: Text From the General Appropriations Act, 73rd Legislature

Sec. 36. Family Practice Clerkship Funding. Each medical school or college shall expend the following amountsfor the purpose of providing a clerkship in family practice during the third core clinical year pursuant to V.T.C.A.,Education Code Section 51.918 (d)(I) as renumbered by Senate Bill No. 232, Acts of the Seventy-second

. Legislature, Regular Session, 1991. Funding for these clerkships may include appropriated funds, institutionalfunds or restricted grant funds. These amounts may not be used to supplant allocations made for other purposes tofamily practice departments and affiliated family practice residency programs. The required third year family.practice clerkship must have a set curriculum and the student must take an exam during the clerkship. Thecompliance of each medical school or college with the provisions of this rider shall be reviewed annually by thestate auditor in conjunction with the Family Practice Advisory Committee of the Texas Higher EducationCoordinating Board. The state auditor shall report the findings of the review to the Legislature.

The University of TexasSouthwestern Medical Centerat Dallas School of Medicine

The University of TexasMedical Branch at GalvestonSchool of Medicine

The University of TexasHealth Science Center atHouston School of Medicine

The University of Texas HealthScience Center at San AntonioSchool Medicine

Texas A&M University Collegeof Medicine

Texas College of OsteopathicMedicine

Texas Tech University HealthSciences Center School ofMedicine

Baylor College of Medicine

JANUARY 1995A STATUTORY REVIEW OF

FAMILY PRACTICE CLERKSHIP

FY 1994

$764,000

563,624

705,584

680,360

192,400

337,620

286,302

133,000

FY 1995

$764,000

563,624

705,584

680,360

192,400

337,620

286,302

133,000

PAGEl

Appendices

Text From the General Appropriations Act, 72nd Legislature

Sec. 37. FAMILY PRACTICE CLERKSIllP FUNDING. Out of the funds appropriated by this article to eachmedical school or college, the following amounts are to beused for the purpose of providing a clerkship in familypractice during the third core clinical year pursuant to V.T.C.A., Education Code Section 51.918 (d)(I) asrenumbered by Senate Bill No. 232, Acts of the 72nd Legislature, Regular Session, 1991. These amounts may notbe used to supplant allocations made for other purposes to family practice departments and affiliated family practiceresidency programs. The compliance of each medical school or college with the provisions of this rider shall bereviewed annually by the state auditor in conjunction with the Family Practice Advisory Committee of the TexasHigher Education Coordinating Board. The state auditor shall report the findings of the review to the Legislature.

The University of TexasSouthwestern Medical Centerat Dallas School of Medicine

The University of TexasMedical Branch at GalvestonSchool of Medicine

The University of TexasHealth Science Center atHouston School of Medicine

The University of Texas HealthScience Center at San AntonioSchool of Medicine

Texas A&M University Collegeof Medicine

Texas College of OsteopathicMedicine

Texas Tech University HealthSciences Center School ofMedicine

Baylor College of Medicine

PAGE 8A STATUTORY REVIEW OF

FAMILY PRACTICE CLERKSHIP

FY 1992

$752,006

563,624

705,584

677,007

183,237

337,620

286,302

485,000

FY 1993

$764,000

563,624

705,584

680,360

192,400

337,620

286,302

485,000

JANUARY 1995

Copies of this report have been distributed to the following:

Legislative Audit Committee

Honorable James E. "Pete" Laney, Speaker of the House, ChairHonorable Bob Bullock, Lieutenant Governor, Vice ChairSenator John Montford, Chair, Senate Finance CommitteeSenator Kenneth Armbrister, Chair, Senate State Affairs CommitteeRepresentative Robert Junell, Chair, House Appropriations CommitteeRepresentative Tom Craddick, Chair, House Ways and Means Committee

Governor of Texas

Honorable George W. Bush

Legislative Budget Board

Sunset Advisory Commission

Governing Board Chair, Chancellor,Health Science Center President, MedicalSchool Dean, and Family MedicineDepartment Chair of Each InstitutionIncluded in This Report

Texas Higher Education CoordinatingBoard

Dr. Kenneth H. Ashworth, Commissioner of Higher Education

Family Practice Advisory Committee

Dr. Samuel T. Coleridge, Chair