Proceedings of the 22nd National Conference: How Will it Work? A New Era for the Teaching Health Center (Part 3, Nocella, Broderick)

Last Updated on April 16, 2022 by Lee Burnett, DO, FAAFP

We gratefully acknowledge the sponsorship of the University of Texas Health Center, Tyler,  for funding the transcription and editing of this section of the Proceedings of the Twenty-Second National Conference. This presentation follows: Proceedings of the 22nd National Conference: How Will it Work? A New Era for the Teaching Health Center (Part 2, Broderick).


Peter Broderick, MD: When Kiki Nocella shows up then you know something bad is happening! She comes to help, so we in the Stanislaus County family medicine residency called Kiki in.

I had met Kiki through the California Academy of Family Physicians, when we created the residency survival guide. Withe her help, we did some work on developing a successful Graduate Medical Education (GME) consortium. Kiki, I’ll turn this over to you!

Kiki Nocella, Ph.D.; CEO, Believe Health, LLC; Valencia, California

Kiki Nocella, Ph.D., Believe Health, LLC, Valencia, California:  Successful consortia! There area lot of reasons a consortium can fail, but there’s also a number of pieces you can put in place to help them succeed.

In Modesto (Stanislaus County), we were able to bring together competing entities that in any other environment would be looking at how they’re going to beat each other out and yet we brought them together because they all found a common vision and through that common vision found trust.

At one point, early on in the consortium building, two of the entities were suing each other. It was fascinating because they all had the emotional intelligence and the commitment to the residency to keep the lawsuit out of the consortium meetings. They would drop it at the door, come in, focus on the business of the consortium and then walk back out and talk to their lawyers about what they were suing each other on.

We take a lot of pride in what occurred there and how people were able to come together on that.

Here are some things you need to do:

  • you need to keep it small,
  • you need to have a lot of face to face. It’s something you can’t just do over the phone. I’ve logged a lot of miles driving up U. S. Highway 99 so we could have these face to face discussions. It’s a different form of management, I mean think, and Peter lives this on a daily basis.

Dr Broderick: Right!

Dr Nocella: Dr Broderick has gone from being a program director who reports directly to the Director of the Stanislaus County Health Services Agency, to becoming a program director who is also the Chief Executive Office of the Consortium, who reports to a board of seven people all of whom are from three different entities. It gets a little crazy, but there is very open, transparent communication.

Up until this time when we built the consortium the numbers weren’t transparent to anyone. And so now, pretty much everybody knows them.

Dr Broderick:  Right!

Dr Nocella: The bottom line is that  groups of people recognize that they can do more together than they can apart. Once that clicks for them you can get forward momentum.

Peter Broderick, MD; Valley Consortium for Medical Education, Modesto, California

Dr Broderick: Actually, I would say that there was a significant amount of activation necessary for our GME Consortium to be created. If you remember your Biochemistry, things don’t happen unless there’s a lot of energy in it. There’s nothing like a good $20 million hole to get people working together!

Basically, CMS took back $20 million and then said they we were not eligible for any GME payments going forward, so it was really a death knell for the residency as it existed.

That’s really why we were compelled to go through what we did. It took a lot of money to do it. There’s some advantages and disadvantages as Kiki says. One of the advantages, is the hidden curriculum of consortia. We all now have relationships with each other. Hospital entities and county entities that here to for probably wouldn’t have collaborated are now thinking about being part of the Medi-Cal [California’s version of Medicaid] 1115 waiver.

We are working together toward a community vision of GME, toward a community vision of health workforce development that’s coordinated, that is rational, that is transparent and open. This is the model that we did as Kiki eluded to, we were able to successfully compete for the teaching health center grant – partly by luck, because the criteria for the teaching health center grant were incredibly narrow. It really only paid for residencies that are owned by community health centers and there are exceptionally few residency programs that meet that criterion.

Of the 11 Teaching Health Center (THCs) that were funded, around eight or nine of them were actually owned in a consortium model. So it’s very uncommon for a CHC to be owned or sponsored by a residency, or to be the owner and sponsor of a residency. It’s more common for communities to come together with consortia.

The entity we created is the Valley Consortium for Medical Education, a 501(c)3 corporation. We are comprised of Memorial Medical Center, Doctors Medical Center and the Health Services Agency.  As the CEO of the Valley Consortium I sit apart from them. Kiki points out, that I’m sometimes the confidante and sometimes the whipping post for board members. Then I’m the residency program director as well.

The teaching health center (THC) funding, a lot of you know already, doesn’t involve CMS. I was surprised about that, but I think it one of the most compelling things about THC funds.

We had made trips back to Baltimore to talk to the highest level administrators in CMS. I was going to call him a bureaucrat, but the highest level administrator in CMS, who many of you know by name, who was exceptionally skilled at saying two diametrically opposite things within the same sentence, in such a way that you weren’t really sure what you were going to need to do to get through this problem.

I was surprised that he didn’t really understand residency training. He suggested that we we could close and open up in a year or two, or thatI should  send my residents to some other residency and I take their residents so that we could call ourselves new, or that I might become certified as an osteopathic physician and create a DO residency – all sorts of really very creative ideas that didn’t seem very practical to me.

So the fact that HRSA would be involved in this funding stream I think is very appealing. I’ll point out they already do GME. They pay for all the pediatric hospital residencies.  Pediatric residencies are all HRSA-funded, and CMS isn’t involved in that. There are significant amounts of money for that purpose also, at least at the beginning $150,000 per resident.

That amount is pretty good compared to the average CMS funding, which is around $120,000. There are hospitals that get $30,000 per resident because they have paltry Medicare bed occupancy. There are hospitals down in Palm Springs that get over $200,000,because there’s a lot of elderly people there that are in the hospital.

So it’s not a very rational system to pay for residencies because this resident doesn’t cost any more at one hospital than another. We do know our costs and it’s somewhere around $150-160,000 per resident so they’re starting to get numbers that seem reasonable for paying for residency education.

There’s quite a few community health centers in California. I was surprised that not everyone is an FQHC or a lookalikes. A small percentage are the 330 grant recipients which are the ones – I’ll have to say there’s a level of arrogance out there about community health centers in California – that the only ones that are the true community health centers are the ones that are federal 330 grant recipients.

Any time that the federal government gives out money, they have a sense of entitlement that this ought to be their money, so we’re seeing a lot of interest in community health centers, that want to be THCs, because this is HRSA money and isn’t HRSA our thing so that we should get their money? But not a lot of them are actually, necessarily in it for the educational mission. That’s an important thing to point out.

Community ownership is the thing that we did that I’m most proud about. This residency is owned by a nonprofit corporation, but it can have stakeholder participants come and go and not the consortium not dissolve. In fact we structured it such that if it did dissolve it would revert back to the former model of ownership through the county; so there is a fail-safe mechanism.

But we’re actually looking at having other participants join. The structure of the consortium allows that.

There is a culture that Marianne alluded to [Proceedings of the 22nd National Conference: How Will it Work? A New Era for the Teaching Health Center (Part 1, McKennett)]. I sit on the board of a large 330 grant recipient community health center, who is somewhat of a competitor in our county. There is a sense of mission that is very deeply instilled in that organization, but it is somewhat antithetical to physician leadership.

Their mission came out of a counterculture in the 1960s where many times – in their mind – organized medicine abandoned the poor, and they stepped into the breach to take care of the underserved.

There’s a strong since of identity and yet residencies are physician-run and physician-managed organizations. Their mission is educational, whereas the mission of a community health center is really about access. Productivity service measures, particularly patient visit counts, are used to define access, so that a resident seeing five patients in a half day does not look good to them.

So there is going to be an issue of culture mixing that we have to get through to create a successful consortium. But you can’t align the missions. That Marianne McKennett can speak to. Many residencies that have gone into community health centers find that if there’s a strong culture of service already existing, the residency’s educational mission is unmeshable.

But if you somehow start the CHC and residency program working together to create an expansion site, and there is an identity with education from the beginning, then you may have a better chance of mixing the missions of education and service.

We showed HRSA the model. One of the things HRSA was looking for in a GME consortium is that the money flows to the THC. There has to be a very strong fiduciary linkage.

What I think sold them on our THC application, is the overlap. I am the CEO, the program director, and the executive director. One of my board members is also the chair of the consortium company board. The report to the community members quarterly about the residency. One person is the CFO for both organizations. There’s a very strong connection.

My residents are in four of the six community health center clinics. This kind of accountability occurs because that health services agency (a government agency) is the applicant, and an FQHC lookalike (with a community governing board) is the co-applicant.

This model showed the feds that, basically, we’re watching both sides of the store here – the education and the funding of the community health center. And I think that convinced HRSA.

The reason we got such a significant grant is really just numbers. Remember it’s about new residents or expansion. That was the other very narrow definition. Not many of us started a brand new residency in 2010 in a community health center. I did.

Not only did I start a new residency, I had all 28 of my slots filled. So I actually counted all of my FTEs that were out in the THC, which for many of us was 55-65% of our training time that went into the THC. I essentially counted it as part of the THC funding, so 16.75 FTEs got funded at this rate.

We viewed the THC funding mechanism as if it were another hospital. If  you are involved in making your own Intern/Resident Information Systems (IRIS) reports, you know how you assign institutional responsibility based on FTE. We looked at this as if it were another hospital and any FTE that took place out in the CHC, I didn’t put on the hospital books.

The result was displaying a significant amount of training as outside the hospitals. All of that training became eligible for THC funding. That’s why it was such a large grant.

So the panel will now address the barriers to collaboration, which Kiki Nocella counseled us through.

Dr Nocella: Just as we were starting the process of building the consortium and getting the collaboration going, we found that a lot of issues of fear and of control needed to be addressed. We developed a process of “key informant interviews”, in which we met one on one with each individual and each entity to find out what was their agenda, both stated and not stated.

Often the unstated agenda is really the important one: What do I as an individual personally need out of this situation?  One of the situations was that the county owned this residency. They were proud of this residency. They were the sponsoring institution.

We needed to address the county officials’ fears of relinquishing ownership. Whether you call their concerns control issues or fear that something bad would happen to the residency program if they relinquished sponsorship, those concerns needed to be addressed.

I would argue at this point that no one currently regrets the change of ownership. It’s been about a year and a half since the consortium was formed and I would say that the Stanislaus County officials see the benefits of the Consortium and would speak to those benefits, rather than deploring the fact that they no longer owned or sponsored the residency program.

We addressed their concerns through a lot of legal agreements, and meeting everyone’s specific needs through those legal agreements.

As Peter mentioned, the culture of training physicians is not necessarily embedded in community health clinics. One  the reasons that consortia make a lot of sense, is that there are lots of FQHCs in the state and in the nation who are saying that they want to be THCs or who want to do residency training.

What I’m saying to them right now is don’t try to do this because the THC funding is available. Do this because it’s the right thing to do. Do it in the format of regional planning, rather than in the silo of the CHC.

By having a collaboration, by having a consortium, you can bring in all the different partners, each of which have a dog in the fight. The hospital does, perhaps a large medical group does, and the CHC does. But they balance each other out.

Then, of course, clearly you have to have the presence of the educational apparatus, such as the residency program director and faculty, who can basically be the barometer and set the pace as to what happens educationally.

There are lots of funding and regulatory constraints. Peter Broderick makes it sound easy, as if there are ten easy steps, but that’s because he wants to forget that there are lots of constraints to figure out how to get around.

We’re still trying to figure this all out as I’ll mention in a little while. They’re the guinea pigs and so there’s a lot we don’t know still. It also cost a fair amount to do this. Unfortunately, the developmental funding for THCs was not appropriated, so folks who are looking at doing this now have to find their own funding to get it going – to hire that program director, or to bring the consortium together.

What I’m seeing though is that communities realize that they so desperately need to address their workforce issues that they are looking to each of their partners to kick in a couple thousand – perhaps ten or 20 thousand dollars – to help fund these types of initiatives. I’m seeing a lot of very positive regional planning initiatives going on in the workforce base.

The Valley Consortium for Medical Education didn’t stop with family medicine. Once the other physician education programs were there, they realized as they were forming the consortium, that suddenly all the hospitals that had had a cap on their number of residency programs – even the hospital that had the funding taken away, had a blank slate through the consortium.

Knowing that they had three years to build a new cap, we’ve developed a strategy that actually that pushes it out to six years. So we’ve got six years to develop residency programs. Next month there is an emergency medicine site visit, a month after that we have an orthopedic site visit, and we are now working on the general surgery program.

So we are very much focusing on what the regional workforce needs are, now that we have this apparatus in six years to develop the cap. We also has some pre-doctoral education that is growing and developing as well. So it’s really turned from something that was a crisis trying to decide how to stop the hemorrhaging quickly to something that is very exciting and dynamic.

The HRSA Teaching Health Center Initiative

I’m sure you’ve all heard about HRSA’s THC initiative. What was cool about it is that it actually allowed consortia to apply. There are a lot of rules as to how a consortium could fit. We were, as Peter said, very lucky. It was serendipity.

For an FQHC or an FQHC lookalike to be part of it, they needed to have an existing HRSA grant in which education was an existing part of the scope of work. To get that in the one month period of time to write the application would have been impossible.

Included within the Valley Consortium, there happened to be a lookalike FQHC that had education in their HRSA scope of work. So they were able to pass through that gate. The bylaws of the consortium that we built a year before fit perfectly with what HRSA was looking for, so we got very lucky and we received funding as a consortium.

There are alternative structures. The doesn’t have to be an FQHC, but it does have to focus on underserved populations. And there are several types of residency programs that are eligible to be funded asTHCs. As Peter mentioned it is initially $150,000 per resident.

There will be a tie-up process where HRSA will tie your costs to the actual $150,ooo.  As the funding gets allocated further out to more programs and more resident slots, the funding may go down per site. But still for most of you guys sitting around the room $150,000 per resident is a gold mine. The total appropriated to the program is 230 million.

Part of what they’re asking each of the new THCs to do is help them figure out how Indirect Medical Education (IME) funds will be determined. This is really exciting, because now we have an opportunity in this five year demonstration project to help the federal government figure out how to reimburse residency training in a community setting in place of the decades old model we’ve used with hospitals through CMS. That model, we all know, doesn’t really work.

It doesn’t count against the hospital cap. In fact, if the hospital doesn’t claim the residents. the THC can claim them all themselves. So a community where the hospital’s already capped has the ability to claim the residents “above the CMS cap” and it isn’t going to be a negative for that hospital.

Eleven TCHs received the first rounds of awards. As Peter mentioned, Modesto got the highest award, because it has the most residents.

The traditional model is one of this where the teaching hospital is accredited. It owns the residency program. It gets the money and it puts residents out in a training site in the community.

The new model is where the THC is the center of the training universe. Funds still go to the hospital for Medicare GME but the THC gets the HRSA dollars, gets the accreditation and then puts residents out in the community sites. We’re very clear that we’re an experiment. We are the lab rats along with ten other CHCs, and so we have a lot of questions.

One of the things we want to do with you guys is share some of our questions and get some of yours. Because in a couple of weeks Peter and I head back to DC for a meeting of the 11 THCs to talk about a variety of issues,  and we have questions such as: Are we going to be held to CMS regulatory standards? For example, under CMS you have to have contracts that show you’re paying for the cost of the residents and any ambulatory site. Is that going to be the expectation for the THCs, even though they’re not CMS?

What sort of audit trails are going to be required? Do we have to document payment? What about the issues of Medicare community benefit? On and on as far as questions that we have.

Also, if a hospital’s setting their cap during this time, how do you deal with that? We have some thoughts, and we have a plan, but we know because of past experience that CMS can come in and say that that’s not what we wanted and reverse the money. So we want to get it documented up front as to how it is be determined that we’ve met our obligations.

Also, under Medicare currently, if a hospital terminates its residents, if a hospital closes or terminates the residency program, the residents can train in another program and there is a temporary increase of cap to the new program. Well what if a THC closes? Because THCs aren’t capped, if a THC closes its residency program, will there be a temporary increase in the cap? Lots of questions. We’d love to get import from all of you.

Dr Robert Ross (Moderator): Dr. Hines is our lead question.

Thomas Hines, MD; Boston University, Boston, Massachusetts

Thomas Hines, MD, Boston University, Boston: I want to thank you all for really remarkable stories. And I also wanted to thank you just as an aside for the brief modeling of patient-centered medical home behavior at the beginning of the group team huddle.

My question notes that teaching community health centers are attractive models for a lot of us who are involved in family medicine residency training. In what ways do you see either your organizations (or since you have your hands full right now), other organizations expanding the educational mission to include undergraduate medical education as well as training of other health care professionals such as nurse practitioners, physician assistants, nursing and other allied health professions?

Marianne McKennett, MD; Scripps Health Center, Chula Vista, California

Marianne McKennett: At our site, we have been a core clerkship site for fourth year students from UCSD, and also have been a longitudinal third year family medicine rotation site. Now we have some revamping of the curriculum at UCSD, which is trying to get students out into the community earlier. It is not quite as involved as what I know that you’re doing in Boston, but UCSD will be getting first and second year students out into longitudinal experiences and we will be a site for that as well.

However, I do see that, as we have had more learners out in the community health center, there have been some concerns again with the health center about how those learners may affect productivity, so we’re actually right in the midst of little bit more strategic planning.

In the past it had been more of “oh sure, come on down” with everybody getting teamed up from the physician point of view. But now either the health center wants to look at it in a more strategic way, which does need to happen.

Dr Broderick:  I would say other health professions training in the community health center, from their point of view, is aligned with their interests. They are interested in recruitment and retention, so they’re also looking for nursing and for allied health professions. Dental residents potentially could rotate in a community health center too.

Our point of view is that we’re in it for the education. As Kiki pointed out you’ve got all the equipment. It’s like having kids – if you’ve got all the stuff, you might as well have more. Here our interests are aligned with community health centers, so I think it’s a really good marriage and I would say one of the values. In Marianne’s case shows that a teaching health center should consider becoming an Area Health Education Center (AHEC) site. Because AHEC, although it’s not a whole lot of money, can help with the clinical education of some of these ancillary  health professions.

Dr Nocella:  Just to add one thing to what Peter said. He sent me an email over the weekend that said “ride the wave or be crushed by it!” It speaks to the inertia that exists almost everywhere. In Valley Consortium and in other sites that they see the opportunity, they’re going for it. The problem is – if you want to look at it as a problem – you’ve got so much good stuff going on, it starts to weigh very heavy.

Peter is working phenomenal hours to make all this happen, but he’s got multiple residency programs starting, he’s running his own program, and he has a predoctoral program going. And there’s not a meeting that goes by it seems, when more ideas are suggestion.

We were having a meeting with the general surgeons the other day. They were talking about the need to have a PA surgical fellowship. We responded that that would be fun! But at some point you have to stop and get done what we’re doing and stop there.

Rick Flinders MD, Santa Rosa Family Medicine Residency

Rick Flinders, Sutter Santa Rosa (California) Family Medicine: As a residency program “near death survivor”, my heart goes out to Peter, but I think what you’ve done is heroic.

What we started back in 2006 as the Santa Rosa consortium is a kind of a pathway out of this nightmare. I think is going to be an increasing need as small hospitals shut down, and those that are sponsors to teaching residency programs, especially family medicine residencies, what you’ve done may well be a kind of a CPR template for an abandoned program.

One of the issues that you mentioned that I think is relevant to us all as we go into the new healthcare plan is this mixing of cultures. Our consortium remains in the spirit of the relationships we developed that allowed us to survive even though the consortium was dechartered.

We’ve moved in with the family health center, the Southwest Sonoma County Family Health Center, which is an FQHC. We’re married now, and are merging these two cultures, one which survives on productivity and the other whose mission is education.

Every day we wrestle with these issues and I think maybe if you could answer some of the ways, some of the steps you can take or a strategy will be helpful for residency programs, as well as, merging with the new healthcare act.

Dr Broderick: Well Rick, as you recall we came and visited you guys as the teachers.

Dr Flinders: You bet!

Dr Broderick: And I think probably and there were many times during this process, it was about a two year process really, from when we knew there was an issue to where we really became a new residency, and the fact that there was such a cataclysmic failure option, we kept reminding everybody, you know we have to get this right, because here’s the alternative: no residency, healthcare system collapses, ERs are overrun.

That’s actually why one of our participants came in, very, very candidly. “I do not want to see your patients in my ER, we’re in”. And so people can be in it for whatever reasons, altruistic or otherwise. They’re honest about it and that really aligned us.

So the think I’d say that was part of our success was just we really kept coming back to what was the failure alternative and it kept us motivated through the times when it was hard, it was expensive, it was arduous with you know, three sets of lawyers, and personalities clashing, but I think that really helped us get through all that.

Dr Ross: Thank you very much, excellent presentation.

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