Foreign Physicians: Exchange Visitor Program Becoming Major Route to
Practicing in U.S. Underserved Areas (Letter Report, 12/30/96,
GAO/HEHS-97-26).

GAO reviewed the extent to which state and federal agencies used waivers
to meet physician shortages in medically underserved areas, focusing on:
(1) how many foreign physicians with J-1 visas receive waivers, where
they practice, and their medical specialties; (2) whether federal
agencies and states effectively coordinate policies and procedures for
granting these waivers; and (3) the extent to which foreign physicians
who receive waivers comply with waiver requirements to practice in
underserved areas.

GAO found that: (1) the number of waivers for physicians with J-1 visas
to work in underserved areas has risen from 70 in 1990 to over 1,300 in
1995; (2) requesting waivers for physicians with J-1 visas has become a
major means of providing physicians for underserved areas; (3) in 1994
and 1995, the number of waivers processed for these physicians equaled
about one-third of the total identified need for physicians in the
country; (4) almost all of these waiver physicians have primary care
medical specialties and they are practicing in 49 states and the
District of Columbia; (5) nearly 30 federal and state agencies were
processing waiver requests for physicians from hospitals, health
centers, and other health care facilities by 1995; (6) among them, no
agency has clear responsibility for ensuring that placement efforts are
coordinated; (7) although the federal agencies are now working together
informally, they still have differing policies, overlapping
jurisdictions, and varying communication with the states; (8) the
Department of Health and Human Services (HHS) believes that the
physicians should return home after completing their training to meet
the intent of the exchange visitor program, and the other agencies view
the waiver provision as a means to secure physicians to meet the health
care needs of their constituents; (9) while more than 9 of every 10
physicians whose waivers were processed between 1994 and 1995 were
practicing at their locations in January 1996, controls are somewhat
weak for ensuring that physicians continue to meet the terms of their
agreements; (10) even when the physicians and facilities follow the
agencies' rules, the rules do not restrict physicians from working with
those segments of the population that already are adequately served; and
(11) proposed regulations published by the United States Information
Agency and developed in working with the informal interagency group,
coupled with recent amendments to the Immigration and Nationality Act
would address many of the coordination and compliance problems, but not
all of them.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  HEHS-97-26
     TITLE:  Foreign Physicians: Exchange Visitor Program Becoming Major 
             Route to Practicing in U.S. Underserved Areas
      DATE:  12/30/96
   SUBJECT:  Physicians
             Cultural exchange programs
             Waivers
             Medical education
             Internal controls
             Interagency relations
             Health resources utilization
             Disadvantaged persons
             Community health services
             Resident aliens
IDENTIFIER:  USIA Exchange Visitor Program
             USIA J-1 Visa Program
             HHS Health Professional Shortage Area System
             Appalachia
             Alabama
             California
             Kansas
             Kentucky
             North Dakota
             West Virginia
             Buffalo (NY)
             Decatur (IL)
             Texas
             HHS Community Health Centers Program
             
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Cover
================================================================ COVER


Report to Congressional Committees

December 1996

FOREIGN PHYSICIANS - EXCHANGE
VISITOR PROGRAM BECOMING MAJOR
ROUTE TO PRACTICING IN U.S. 
UNDERSERVED AREAS

GAO/HEHS-97-26

Waivers for Foreign Physicians

(108258)


Abbreviations
=============================================================== ABBREV

  ACGME - Accreditation Council for Graduate Medical Education
  AMA - American Medical Association
  ARC - Appalachian Regional Commission
  COGME - Council on Graduate Medical Education
  DOT - Department of Transportation
  ECFMG - Educational Commission for Foreign Medical Graduates
  HHS - Department of Health and Human Services
  HUD - Department of Housing and Urban Development
  INS - Immigration and Naturalization Service
  NHSC - National Health Service Corps
  USDA - United States Department of Agriculture
  USIA - United States Information Agency
  VA - Department of Veterans Affairs

Letter
=============================================================== LETTER


B-271030

December 30, 1996

Congressional Addressees

Placing enough physicians in underserved areas remains a longstanding
problem in the United States, despite many attempts to resolve the
situation.  To address this problem, a growing number of locations
are turning to non-U.S.  citizens who have just completed their
graduate medical education in the United States.  These physicians
generally enter the United States under an exchange visitor program
administered by the United States Information Agency (USIA).  Their
visas, called J-1 visas, require them to leave the country when their
medical training is done, but this requirement can be waived at the
request of a federal agency or a state.  This waiver is usually
accompanied by a requirement that the physician practice for a
specified period in an underserved area. 

The growing use of these waivers is not without controversy.  The
Department of Health and Human Services (HHS) is the main federal
agency responsible for addressing physician shortages and medical
underservice.  HHS has taken the position that the J-1 visa is a way
to pass advanced medical knowledge to other countries and that
waivers of the J-1 visa requirement should not be used as a means to
address medical underservice in the United States.\1 Instead of using
waivers to address underservice, HHS administers its own federal
programs specifically for this purpose, particularly the National
Health Service Corps (NHSC).  Some other groups, including the Pew
Health Professions Commission and the Institute of Medicine's
Committee on the U.S.  Physician Supply, believe that allowing
foreign physicians to remain in the United States after completing
their graduate medical education could contribute to a general
oversupply of physicians, which could drive up medical costs.\2 Many
communities that need physicians, however, are using these waivers to
address physician shortages, stating that they could not recruit
qualified physicians without doing so. 

To provide information that would be useful to the Congress in
addressing this issue, we conducted a self-initiated study focused
primarily on the following questions: 

  -- How many foreign physicians with J-1 visas receive waivers,
     where do they practice, and what are their medical specialties? 

  -- Do federal agencies and states effectively coordinate policies
     and procedures for granting these waivers? 

  -- To what extent are foreign physicians who receive waivers
     complying with waiver requirements to practice in underserved
     areas? 

To conduct this work, we developed two surveys addressing the extent
to which states and federal agencies used waivers to meet physician
shortages.  One polled all states to determine the size of their
programs for requesting waivers.  The other surveyed health care
facilities for a random sample of physicians who received waivers. 
These surveys provided more complete information than was available
from participating agencies, including USIA, the Immigration and
Naturalization Service (INS), and the federal agencies requesting
waivers for physicians.  We supplemented this work with reviews of
existing data, interviews with agency officials and others involved
with the waivers, and field work in three states.\3 Appendix I
explains our methodology in more detail. 


--------------------
\1 See 45 C.F.R.  50.3(a)(1995).  This position was reiterated in an
August 1995 letter from the Secretary of HHS to the heads of other
federal agencies.  However, HHS does request waivers for physicians
and scientists engaged in critical biomedical research. 

\2 See Pew Health Professions Commission, Critical Challenges: 
Revitalizing the Health Professions for the Twenty-First Century (San
Francisco:  University of California San Francisco Center for the
Health Professions, 1995) and Institute of Medicine, The Nation's
Physician Workforce:  Options for Balancing Supply and Requirements
(Washington, D.C.:  National Academy Press, 1996). 

\3 We included waivers granted to physicians for practicing in
underserved areas only.  As such, we did not include in our analysis
physicians whose waivers were requested by the Department of Veterans
Affairs (VA) or physicians whose waivers were requested by other
agencies for research purposes . 


   RESULTS IN BRIEF
------------------------------------------------------------ Letter :1

The number of waivers for physicians with J-1 visas to work in
underserved areas has risen dramatically in the past few years, from
70 in 1990 to over 1,300 in 1995.  Requesting waivers for physicians
with J-1 visas has become a major means of providing physicians for
underserved areas; in 1994 and 1995, the number of waivers processed
for these physicians equaled about one-third of the total identified
need for physicians in the country.  In the process, a program to
transfer knowledge to other countries has partially given way to a
domestic placement effort that now includes professional recruiters
and immigration attorneys.  Almost all these waiver physicians have
primary care medical specialties and they are practicing in 49 states
and the District of Columbia.  Their practice locations range from
health centers in public housing projects to private practices
affiliated with for-profit hospitals. 

This growing domestic placement effort is rudderless.  While only one
agency was requesting waivers to address physician shortages in 1990,
nearly 30 federal and state agencies were processing waiver requests
for physicians from hospitals, health centers, and other health care
facilities by 1995.  Among them, no agency has clear responsibility
for ensuring that placement efforts are coordinated.  The agencies
have generally operated independent of one another, resulting in
overlap and oversupply, which has led to the accumulation of more
physicians than needed to remove shortage designations in some
states.  Although the federal agencies are now working together
informally, they still have differing policies, overlapping
jurisdictions, and varying communication with the states.  The
coordination problem is compounded by the policy differences between
HHS and the agencies requesting waivers for physicians.  HHS believes
that the physicians should return home after completing their
training to meet the intent of the exchange visitor program, and the
other agencies view the waiver provision as a means to secure
physicians to meet the health care needs of their constituents. 

While more than 9 of every 10 physicians whose waivers were processed
between 1994 and 1995 were practicing at their locations in January
1996, controls are somewhat weak for ensuring that physicians
continue to meet the terms of their agreements.  Analysis by us and
the Appalachian Regional Commission's (ARC) Inspector General found
instances in which physicians were not practicing at the facility
where agencies believed them to be or were not practicing full-time
in the underserved areas for which their waivers were granted.  In
addition, even when the physicians and facilities follow the
agencies' rules, the rules do not restrict physicians from working
with those segments of the population that already are adequately
served--for example, working in a location that has been identified
as having an underserved migrant group, but treating other segments
of the population instead. 

Proposed regulations published by USIA and developed in working with
the informal interagency group, coupled with recent amendments to the
Immigration and Nationality Act would address many of the
coordination and compliance problems, but not all of them.  This
report contains matters for congressional consideration that would
resolve some of these problems, including clarification of federal
policies, management of the program, and improvement of monitoring
and enforcement penalties. 


   BACKGROUND
------------------------------------------------------------ Letter :2

J-1 visas allow foreign nationals to participate as exchange visitors
in cultural and educational programs in the United States.  USIA is
responsible for managing the J-1 visa program and designates
organizations as program sponsors.  In 1995, over 9,000 foreign
physicians with J-1 visas were in the United States for graduate
medical education or training.  These exchange visitors constituted
about one-tenth of all individuals receiving graduate medical
education (see app.  II).  Because many exchange visitors are in the
United States for several years for graduate medical education and
training, each year a few thousand new physicians receive J-1 visas
and enter the United States to begin graduate medical education and
training while a few thousand complete their training. 

To ensure that the J-1 visa program works as intended in passing
learning and experience to other countries, the Congress has imposed
restrictions on J-1 visa holders, including physicians in graduate
medical education.  These physicians are required to return to their
home country (or to their country of last legal residence) for at
least 2 years after completion of training.  However, they may obtain
a waiver of this requirement and remain in the United States.  For
most physicians, the waivers are requested on their behalf by a
federal agency or by a state agency or department that is responsible
for public health issues.\4 These federal agencies and states
generally request waivers of the 2-year foreign residence requirement
so that the physicians can practice for several years in underserved
areas (see table 1).\5 The federal agencies and states submit these
requests to USIA. 



                                Table 1
                
                 Conditions for Waivers for Physicians
                             With J-1 Visas

                                    State agencies or departments
Interested U.S. government          responsible for public health
agencies\a                          issues
----------------------------------  ----------------------------------
For whom can they request waivers?
----------------------------------------------------------------------
J-1 visa exchange visitors,         J-1 visa exchange visitors in
including those in graduate         graduate medical education or
medical education or training, who  training
are participating in a program or
activity sponsored by or of
interest to the agency


What are the conditions for approving the request?
----------------------------------------------------------------------
(1) The waiver is in the public     (1) The waiver is in the public
interest and (2) compliance with    interest,
the foreign residence requirement   (2) the physician agrees to
would be detrimental to a program   practice medicine for at least 3
or activity of interest to the      years in an area designated by the
agency                              Secretary of HHS as having a
                                    shortage of health care
                                    professionals,\b and
                                    (3) the physician has a bona fide
                                    offer of full-time employment and
                                    agrees to begin work within 90
                                    days of receiving the waiver


How many waivers can be granted each fiscal year?
----------------------------------------------------------------------
No limit                            Each state, regardless of size or
                                    identified physician need, is
                                    limited to 20 new waivers for
                                    physicians each year
----------------------------------------------------------------------
\a Amendments in the Omnibus Consolidated Appropriations Act, 1997,
impose additional requirements not in effect at the time of our
review on physicians sponsored by interested U.S.  government
agencies so that their responsibilities are now more consistent with
those of physicians sponsored by states.  However, the amendments did
not impose any annual limits on the number of waivers (see app. 
III). 

\b These include (1) geographic areas, population groups, and health
care facilities that HHS has designated as Health Professional
Shortage Areas and (2) Medically Underserved Areas or Populations,
those designated by HHS as having shortages of health care services
based on factors such as physician-to-population ratios, infant
mortality, and poverty rates. 

USIA reviews the program, policy, and foreign relations aspects of
the case and forwards its recommendations to the INS Commissioner. 
For waiver requests made by interested U.S.  government agencies or
states, INS may only grant the waiver if USIA submits a favorable
recommendation.  Figure 1 illustrates the waiver process. 

   Figure 1:  J-1 Waiver Process

   (See figure in printed
   edition.)

\a Amendments in the Omnibus Consolidated Appropriations Act, 1997,
impose additional requirements on interested U.S.  government agency
requests (see app.  III). 

\b The physician must also have a bona fide offer of full-time
employment, agree to begin work within 90 days of receiving the
waiver, and fulfill the required 3-year employment contract with the
sponsoring health care facility named in the waiver application. 

While HHS is the federal agency responsible for addressing physician
shortages it does not use waivers to do so.  HHS endorses the
philosophy that exchange visitors return home after completing their
training to make their new knowledge and skills available to their
home countries.  As a result, HHS does not support waivers for
physicians to remain in the United States to practice in underserved
areas. 

Instead, HHS administers other federal programs, such as NHSC, to
address physician shortages in the United States.  NHSC supplies
physicians and other health professionals to underserved areas
primarily by (1) awarding scholarships to students who agree to serve
in a shortage area after their health professions training is
complete and (2) repaying a set amount of educational loan debt for
each year of service in a shortage area.\6 On December 31, 1995, 848
NHSC physicians and 685 other NHSC professionals who received
scholarships or federal loan repayment were practicing in underserved
areas of the country.\7

In addition to NHSC, HHS has other programs to address medical
underservice.  For example, HHS provides federal grant funding to
community health centers that are required to accept all patients
regardless of their ability to pay. 


--------------------
\4 For simplicity, we will refer to these state agencies or
departments as states. 

\5 Physicians with J-1 visas may also obtain a waiver if INS
determines that the return to their home countries would create an
exceptional hardship to their spouse or child (who must be a U.S. 
citizen or lawful resident alien) or if the return would subject them
to persecution because of race, religion, or political beliefs. 
However, these individuals are not required to practice medicine in
an underserved area, so we did not include physicians who received
waivers under these provisions in our review.  See app.  III for
additional information on the 2-year foreign residence requirement
and the waiver provisions that have evolved since the exchange
visitor program was authorized in 1948. 

\6 Our previous report, National Health Service Corps:  Opportunities
to Stretch Scarce Dollars and Improve Provider Placement
(GAO/HEHS-96-28, Nov.  24, 1995), discusses the NHSC scholarship and
loan repayment programs.  We found that overall, when compared to the
scholarship program, the NHSC loan repayment program offers a better
long-term investment of scarce federal resources to address shortages
of primary care providers. 

\7 ln addition to the scholarship and federal loan repayment
programs, NHSC also supports physicians and other health
professionals through a state loan repayment program and other
efforts.  Including these NHSC providers, 2,226 NHSC physicians,
dentists, and other health care providers were practicing in
underserved areas as of September 30, 1996, of which 1,267 were
physicians. 


   USE OF WAIVERS HAS GROWN IN
   SIZE AND SCOPE
------------------------------------------------------------ Letter :3

Begun as an exceptions policy, the number of physicians receiving
waivers of the 2-year foreign residence requirement for J-1 exchange
visitors has grown more than tenfold in the past 5 years.  Several
factors have contributed to the increase:  more hospitals and other
facilities have found the waiver to be a means to fill their empty
positions; more agencies and states are making requests; and
physicians are actively seeking waivers, in some cases allegedly
paying recruiters and immigration attorneys to find them a position. 
Waiver physicians are practicing in virtually every state; most are
primary care physicians. 


      THE NUMBER OF WAIVERS HAS
      INCREASED SIGNIFICANTLY
---------------------------------------------------------- Letter :3.1

The number of waivers being processed for physicians to practice in
underserved areas each year has grown from 70 in 1990, to 1,374 in
1995 (see fig.  2).\8 In 1995, the number of waivers being processed
for physicians was greater than the number of NHSC physicians (1,267)
practicing in underserved areas, and it was enough to offset about 27
percent of the total physician shortage identified by HHS. 
Indications are that in 1995, about half of the foreign physicians
that were supposed to return home were granted waivers of this
requirement to practice in an underserved area in the United
States.\9

   Figure 2:  Number of Waivers
   Processed for Physicians With
   J-1 Visas, 1990-95

   (See figure in printed
   edition.)

Note:  Numbers determined from federal agency and state data on
waiver requests sent to USIA for physicians to practice in
underserved areas, excluding requests for physicians to conduct
research and requests from VA. 

Why do facilities want to employ foreign physicians through the use
of the waivers?  In responding to our survey and during our visits to
health centers, physician offices, clinics, and other health care
facilities where these physicians were practicing, many officials
said that their facilities had turned to these physicians because
they were unable to recruit U.S.  physicians.  For example, the
administrator of a county public health unit in Florida commented
that most U.S.  physicians are not willing to work in rural areas,
but she has found many physicians with J-1 visas who had excellent
references and credentials and who were willing to practice there. 
She said it would be a "travesty" to health care in rural areas if
these waiver physicians were not available.  Other reasons cited for
hiring these physicians are their superior foreign language skills
and cultural familiarity with a facility's patient population.  For
example, several physicians received waivers to practice at a migrant
health center in Eastern Washington.  These physicians were
recruited, in part, because they are native Spanish speakers, which
enables them to effectively treat the center's Spanish-speaking
patients. 

The sudden increase in the number of waivers being processed in 1994
and 1995 probably reflects the fact that facilities had additional
places to turn to for requesting the waivers.  By 1995, four U.S. 
government agencies and 23 states were requesting waivers of J-1 visa
requirements for physicians.  Before 1993, the only agency requesting
waivers for a number of physicians to practice in underserved areas
was ARC.  ARC began requesting waivers in the 1980s for physicians to
practice in Appalachia.\10 However, ARC requested around 200 or fewer
waivers per year, peaking at 266 waivers in 1993.  In addition to
ARC, since 1993 the Department of Transportation (DOT) has requested
waivers for a handful of physicians to practice in one rural area
where the U.S.  Coast Guard operates.\11

The rapid growth in waivers began in late 1993 and 1994, when the
U.S.  Departments of Agriculture (USDA) and Housing and Urban
Development (HUD) began requesting them for physicians to serve their
rural and urban constituents.  Senior officials at both agencies said
that they initially responded to a constituent request to support a
specific physician; however, their offices were subsequently flooded
with requests for waivers for other physicians.  Agency officials
said that they would like to limit the number of waivers processed by
their agencies, but have not found a way of effectively restricting
them. 

The number of waivers also increased because the authority for states
to request waivers was passed in 1994, and 23 states requested
waivers in calendar year 1995.\12 As a result of the entry of these
federal agencies and states, physicians seeking waivers were no
longer limited to practice locations in Appalachia and areas serving
DOT personnel; instead, they could practice in rural and urban areas
across the country.  However, HUD officials have recently decided to
reassess the department's waiver policy and stopped accepting
requests after August 30, 1996, to conduct a review.  Table 2 shows
the number of waiver requests submitted to USIA by each agency in
1995 and the reason for the requests.  For information on the number
of waivers requested by each agency since 1990, see appendix V. 



                          Table 2
          
          Requests for Waivers for Physicians, by
              States and Federal Agency, 1995

               Waivers
Requesting    requeste
agency               d  Reason for requesting waivers
------------  --------  ----------------------------------
ARC                157  To assist residents of Appalachia
                         in having access to quality,
                         affordable health care
DOT                  1  To enable physicians to practice
                         in a rural area where the U.S.
                         Coast Guard operates
HUD\a              375  To assist indigent, medically
                         underserved urban residents with
                         access to quality, affordable
                         health care as part of HUD's
                         mission to create communities of
                         opportunity
USDA               752  To address the needs of
                         underserved rural areas with
                         shortages of physicians as part
                         of USDA's responsibility for
                         coordinating and providing
                         federal services to rural
                         communities
States\b            89  To enable physicians to practice
                         in areas designated by the
                         Secretary of HHS as having a
                         shortage of health care
                         professionals--other reasons vary
                         by state
==========================================================
Total            1,374
----------------------------------------------------------
\a HUD stopped accepting new requests in August 1996 in order to
review its waiver policy. 

\b States were first authorized to request waivers in October 1994. 

Another factor in the increase in waivers may be the interest among
physicians with J-1 visas themselves.  Health care facility
officials, as well as state and federal health officials, said that
they have been inundated with inquiries from physicians who would
like to obtain a waiver by working in a shortage area.  In addition,
officials at several facilities said that they were contacted by
professional recruiters or immigration attorneys regarding the
availability of a physician to meet their facility's needs if the
physician could obtain a waiver.  Some facility officials and
physicians reported paying up to $25,000 in immigration attorney or
recruiter fees for assistance in matching a physician with a facility
and processing the waiver.  During our site visits to facilities
where physicians who had received waivers were practicing, physicians
cited several reasons why they wanted waivers, including that (1)
they would not be able to apply the medical skills they had learned
in the United States in their home countries, (2) they were concerned
about violence in their home countries, (3) they wanted to serve in
an underserved area, (4) their families and relatives were in the
United States, and (5) they had a general desire to stay in the
United States. 


--------------------
\8 Numbers were determined from data from requesting federal agencies
and states on waiver requests submitted to USIA.  While USIA data
showed similar trends, we relied on data from requesting agencies
because USIA did not maintain data specifically on waivers for
physicians to practice in underserved areas.  We excluded from our
analysis those physicians whose waivers were requested by VA and
physicians whose waivers were requested by other agencies for
research purposes. 

\9 To estimate the number of physicians who would be required to
return home, we counted the number of physicians sponsored as
exchange visitors in graduate medical education and training in the
1994-95 academic year who were not sponsored in the 1995-96 academic
year.  We compared this to the number of physicians whose waivers
were processed in 1995, to obtain a rough estimate of the percentage
of physicians who were supposed to return home but who received
waivers to practice in underserved areas in the United States.  See
app.  I for additional information on our methodology. 

\10 The Appalachian region includes specific counties in 13 states. 
See 40 U.S.C.  App.  403(1994). 

\11 VA has also requested waivers for physicians.  However, because
these physicians practice in VA facilities and not in underserved
areas, they were not included in our review. 

\12 On a fiscal year basis, our survey of states regarding J-1
waivers for physicians found that 20 states had requested waivers in
fiscal year 1995 and 34 states had requested or planned to request
waivers in fiscal year 1996.  See app.  IV for our survey results. 


      WAIVER PHYSICIANS PRACTICE
      THROUGHOUT THE COUNTRY IN A
      VARIETY OF SETTINGS
---------------------------------------------------------- Letter :3.2

In 1996, waiver physicians were practicing in 49 states and the
District of Columbia--every state except Alaska.\13 However, the
degree to which they are relied on to relieve physician shortages
varies greatly from state to state.  To measure the extent of this
reliance, we compared the number of waivers granted or in process in
1994 and 1995 with the number of physicians identified by HHS as
needed to remove the shortage area designations in a state.\14 In
five states (Alabama, Kansas, Kentucky, North Dakota, and West
Virginia), the number of physicians for whom waivers were processed
equaled more than 75 percent of the number of physicians needed to
remove these designations in the state.  In other states, such as
California, such physicians equal less than 10 percent of the
identified need. 

Physicians with waivers are practicing in a variety of settings.  Our
survey results show that more than one-third of physicians who
received their waivers through federal agencies are practicing in
nonprofit community or migrant health centers and about one-fourth
are in a private or group practice.  The rest are practicing in
hospitals, for-profit health centers, or other settings (see fig. 
3).  See appendix VI for more detailed information on the results of
our survey of facilities. 

   Figure 3:  Practice Settings of
   Waiver Physicians Practicing on
   January 1, 1996

   (See figure in printed
   edition.)

Note:  Other includes for-profit health centers, rural health
clinics, and other facilities. 

Note:  Determined from survey results for physicians whose waivers
were processed by federal agencies in 1994 and 1995. 


--------------------
\13 Although Guam, Puerto Rico, and the U.S.  Virgin Islands are also
authorized to request waivers for physicians to practice in
underserved areas, they had not done so at the time of our review. 

\14 See app.  I for more detailed information on our methodology. 


      MOST WAIVER PHYSICIANS HAVE
      PRIMARY CARE SPECIALTIES
---------------------------------------------------------- Letter :3.3

Using our survey results, we estimate that almost all physicians
practicing on January 1, 1996, whose waivers were processed through
federal agencies were practicing in primary care specialties. 
Overall, more than half of them were practicing in internal medicine
(see fig.  4).  The other major primary care specialties were
pediatrics and family practice. 

   Figure 4:  Practice Specialties
   of Waiver Physicians Practicing
   on January 1, 1996

   (See figure in printed
   edition.)

Note:  Determined from our survey results for physicians whose
waivers were processed by federal agencies in 1994 and 1995. 

We estimate that one-third of the waiver physicians who had primary
care specialties also had subspecialties.  The most prevalent
subspecialty was nephrology (medicine concerned with kidney disease),
which was reported for about 7 percent of the primary care
physicians.  Other subspecialties included infectious diseases,
cardiology, and gastroenterology.  Requesting facilities and state
officials had mixed views on the usefulness of subspecialties for
meeting their needs.  Officials from some states said that physicians
with subspecialties are not as desirable because they may not remain
in the area to practice primary care.  In fact, several states have
policies to not request waivers for physicians who have
subspecialties.  On the other hand, officials at some facilities said
that they recruited specific physicians, such as a nephrologist,
because their subspecialties enabled them to meet the needs of their
patient populations. 


   WAIVERS ARE NOT COORDINATED
   EFFECTIVELY ACROSS
   PARTICIPATING AGENCIES AND
   STATES
------------------------------------------------------------ Letter :4

Requests for waivers for physicians with J-1 visas are not
coordinated effectively among the agencies and states or with other
medical underservice programs, such as NHSC.  No single entity is
responsible for coordinating practice locations of waiver physicians
and HHS, perhaps the most logical candidate for doing so, opposes the
way in which the waivers are being used.  Because no single entity is
responsible for coordinating physicians' practice locations, the
requesting agencies set up varying policies for requesting the
waivers.  Because of the lack of coordination, the number of waivers
processed for physicians to practice in some states has been more
than the amount needed to alleviate the identified physician shortage
in that state. 


      NO AGENCY IS RESPONSIBLE FOR
      MANAGING WAIVERS TO ADDRESS
      PHYSICIAN SHORTAGES
---------------------------------------------------------- Letter :4.1

No single agency has management responsibility for use of the waivers
to address physician shortages.  While USIA and INS must recommend
and approve all waivers of the 2-year foreign residence requirement
for physicians requested by interested government agencies and
states, USIA and INS officials said that they recommend and approve
virtually all waiver requests.  USIA officials said that while they
check for required documentation, they almost always rely on the
interested government agencies' assertions that the waivers are in
the public interest.  INS officials said that refusal of the waiver
is extremely rare if USIA has given a favorable recommendation.  INS
officials said that they are not in a position to second-guess USIA
or the interested government agency as to whether the public interest
would be served if the waiver was granted. 

Although HHS is the federal agency responsible for addressing
physician shortages, it is not responsible for managing the use of
waivers for physicians and does not support waivers for physicians to
practice in underserved areas.  Specifically, an HHS regulation
states that it will not request a waiver

     "when the application demonstrates that the exchange visitor is
     needed merely to provide services for a limited geographical
     area and/or to alleviate a local community or institutional
     manpower shortage, however serious."\15

The current Secretary of HHS has reiterated the department's position
on waivers for physicians with J-1 visas.  In an August 1995 letter
to the heads of USDA, HUD, and ARC, the Secretary stated

     "In summary, this Department has viewed the J-1 visa to be a
     means of sharing advanced medical knowledge and allowing the
     benefits of training to accrue to the home country.  The
     Department does not view waivers as a mechanism to help resolve
     the problems of shortage areas."


--------------------
\15 See 45 C.F.R.  50.3(a)(1995). 


      FEDERAL AGENCY AND STATE
      POLICIES ARE NOT CONSISTENT
---------------------------------------------------------- Letter :4.2

Without any overall management of the use of waivers, waiver policies
vary considerably between agencies, leading in some cases to
"shopping" by the physicians seeking a waiver to obtain the most
advantageous terms.  Policies vary with regard to such matters as
eligible practice locations and state involvement and the
consequences of the physician's failure to complete the agreed-upon
length of service.  For example, ARC restricts physicians to practice
locations in federally designated Health Professional Shortage Areas,
while the physicians who received waivers through USDA and HUD have
been allowed to practice in other areas, including designated
Medically Underserved Areas.  ARC officials said that they excluded
the Medically Underserved Area designations because (1) this
designation is not an accurate measure of physician shortage; (2) the
designations have not been updated; and (3) including them would
allow physicians to practice in virtually any location in
Appalachia.\16 Federal agency and state officials also said that and
our review found cases where physicians or their immigration
attorneys were shopping between agencies; that is, requesting waivers
through multiple agencies at the same time. 

State health officials commented that they would like consistency in
waiver policies across federal agencies.  One state health official
commented that participation of multiple federal agencies has
resulted in confusing and sometimes contradictory program guidelines
and has placed a burden on states to coordinate programs. 


--------------------
\16 Our prior report, Health Care Shortage Areas:  Designations Not a
Useful Tool for Directing Resources to the Underserved
(GAO/HEHS-95-200, Sept.  8, 1995), identified a number of weaknesses
in HHS' Health Professional Shortage Area and Medically Underserved
Area designation systems.  Among them was the lack of periodic review
and update of Medically Underserved Area designations.  In addition,
one state we visited for this assignment reported that (1) 90 percent
of the state's federally designated Medically Underserved Areas had
not been reevaluated for more than 10 years and (2) HHS has not acted
upon proposed deletions of these designations. 


      LARGELY AUTONOMOUS EFFORTS
      LEAD TO COORDINATION
      PROBLEMS
---------------------------------------------------------- Letter :4.3

Thus far, the various efforts to use waiver physicians to address
medical underservice have operated largely independent of each other
and of other programs to address medical underservice.  By 1995,
there were nearly 30 federal agencies and states processing requests
for waivers for physicians with J-1 visas.  Most of them were
operating independent of one another. 

The four federal agencies have no formal process for coordinating
their waiver requests and they have overlapping jurisdictions.  For
example, while USDA's policy has been to request waivers for rural
areas and HUD's policy has been to request waivers for urban areas,
the two agencies have not agreed on which areas are rural and which
are urban.  As a result, we found some locations, such as Buffalo,
New York, and Decatur, Illinois, where USDA requested waivers for one
or more physicians and HUD requested waivers for additional
physicians to practice in the same city and in some cases the same
facility.  There is no mechanism for each federal agency to know how
many waivers the other has requested to address the physician
shortage in an area. 

Coordination is also lacking between state and federal efforts. 
State health officials do not always know where physicians receiving
waivers through federal agencies are practicing and, therefore, they
cannot coordinate these placements with state programs to address
medical underservice.  While ARC requires that facilities' requests
for waivers come through the states, other agencies do not.  This
leads to situations where the states are unaware of the level of
placements that are occurring.  For example, health department
officials in Texas, which does not request waivers for physicians
under the state authority, did not know how many physicians received
waivers through federal agencies to practice in the state.  As a
result, when we scheduled our visits to practice sites in Texas,
state officials were surprised to find out that federal agency
records showed over 20 waiver physicians practicing in El Paso. 

Waivers for physicians also are not well-coordinated with other
programs addressing underservice, such as those operated by HHS.  One
such program is NHSC.  When combined with NHSC physicians, federal
agencies and states have requested waivers for more physicians than
are needed to remove the shortage designations in some states.  We
found that for eight states, the number of physicians who received
waivers in 1994 and 1995 (or had waivers in process), combined with
the number of NHSC physicians in service at the end of 1995, exceeded
the number of physicians needed to remove the shortage area
designations in the state.  (See app.  VII for more information on
the identified need, number of waivers being processed, and the
number of NHSC physicians practicing in each state.) Without
information on the number of physicians needed in the area and the
number of NHSC and waiver physicians already addressing that need,
federal agencies and states will not know if the needs of an area are
already being met when considering whether or not to request a waiver
for a physician. 

Another HHS program with which physician waivers are not
well-coordinated is the Community Health Center program.\17 This
means that federal agencies and states may not know of problems
identified by HHS when considering requests from community health
centers.  For example, waivers were requested through HUD for several
physicians to practice at a health center that had its HHS funding
discontinued due to financial management problems.  When requesting
the waivers for these physicians, HUD officials did not know that HHS
had identified problems with the health center.  As a result, they
could not take those problems into consideration when deciding
whether the waivers were in HUD's and the public's interest. 

Coordination between the agencies involved in the requests and other
programs to address medical underservice is important, because not
all the agencies processing the waiver requests have expertise in
addressing health care issues.  For example, USDA and HUD officials
involved in the waiver requests said that their offices lacked
expertise in health issues.  In USDA, waivers for physicians are
processed in the department's Agricultural Research Service by an
office that has experience processing waiver requests for a small
number of research scientists who were in the United States as
exchange visitors.  At HUD, the waivers were processed in the Office
of the Deputy Assistant Secretary for Intergovernmental Relations. 


--------------------
\17 HHS funds community and migrant health centers to provide primary
care services to medically underserved populations, including the
poor, uninsured, minorities, women, children, and the elderly. 


   MOST PHYSICIANS COMPLY WITH
   AGREEMENTS BUT CONTROLS ARE
   WEAK
------------------------------------------------------------ Letter :5

Although most physicians who obtain waivers of their J-1 visa foreign
residence requirement are apparently complying with the terms of
their service agreements, weak controls mean there is little to deter
physicians or their employers from failing to comply if they choose
to break these terms.  For example, we found instances in which a
physician never practiced at the intended facility, unbeknownst to
the agency processing the request. 


      MOST PHYSICIANS ARE
      COMPLYING WITH AGREEMENTS,
      BUT SOME ARE NOT
---------------------------------------------------------- Letter :5.1

Including all current waiver physicians when assessing compliance
with requesting agency policies can present somewhat of a misleading
picture, because so many of these physicians have been at their jobs
for a relatively short time, in many cases for less than 1 year. 

To provide a more accurate picture of whether physicians stay for the
full term of their agreement, we analyzed those physicians whose
waivers had been requested through ARC from 1990 to 1992.  We
estimate that 90 percent completed the minimum employment period
required by ARC, which was 2-years,\18 for the facility that
requested the waiver.\19

On January 1, 1996, over one-fourth (28 percent) were still
practicing at the same facility that requested the waiver and nearly
half of these (13 percent) had been there for more than 4 years. 

We also examined the shorter-term compliance record of all physicians
practicing on January 1, 1996, after receiving waivers through
federal agencies between 1994 and 1995.  We estimate that 96 percent
of them were working at the facility for which the waiver was
requested.  The remaining 4 percent had left or did not plan to work
at that facility.  Although this percentage is similar to the
percentage of ARC physicians who did not complete their 2-year
agreements, the percentage may grow because many of the physicians
had completed only a fraction of their employment contract by the
start of 1996.\20 For example, none of the physicians with waivers
through HUD had been practicing for more than 1 year by that date. 


--------------------
\18 ARC increased the minimum employment period from 2 to 3 years in
1995 to be consistent with the 3-year minimum employment period
required for waivers requested through the states. 

\19 Of the physicians that did not work for 2 years at the facilities
for which ARC requested a waiver, we found at least a portion had
worked in other shortage areas in Appalachia.  Although these
physicians may have helped to address physician shortages in these
areas, they did not address the particular situation that ARC deemed
to be in the public interest.  In addition, because ARC did not know
where they were practicing, ARC could not effectively coordinate
physician practice locations with other waiver requests and with
other agencies' and states' programs. 

\20 As an example, we found that at least 4 of the physicians in our
1994 to 1995 survey sample had left the facility after January 1,
1996, before practicing there for the required 2 to 3 years.  One was
practicing in another shortage area; the others are discussed in our
examples. 


      REASONS FOR FAILURE TO
      COMPLY WITH AGENCY POLICIES
      RESTED PARTLY WITH
      FACILITIES, PARTLY WITH
      PHYSICIANS
---------------------------------------------------------- Letter :5.2

For the physicians in our sample and in the states we visited,
several reasons they were not practicing at the location for which
the waiver was requested had to do with changes made by the facility
that initiated the request.  We found cases in which a facility made
the request and then determined that the physician was no longer
needed.  In at least one case, it appears that the employer made this
determination before the waiver was even granted, but the physician
still received the waiver.  Here are examples in which the facility
changed its mind: 

  -- In letters asking USDA to request waivers for three physicians,
     a clinic in Illinois said that the physicians were needed to
     help meet an urgent primary care delivery crises in the rural
     community where the practice site was located.  Six months after
     one of the physicians began working there, she was terminated
     because the clinic had determined that it was overstaffed.  She
     is now practicing in another city in Illinois that has an
     identified shortage of physicians who serve Medicaid patients. 
     The second physician was transferred from the location on the
     waiver request to another location that is not in a federally
     designated shortage area.\21 The third physician was practicing
     only part- time at the practice site for which the waiver was
     requested.  He said that because there were not enough patients
     in that location, he spends about half his time working at the
     main clinic in Champaign, Illinois. 

  -- A medical group asked HUD to request waivers for three
     physicians to work at a practice purchased from a retiring
     physician outside of Atlanta.  When we called the practice site,
     we were told that only one of the three was practicing there. 
     An official from the medical group said that the practice no
     longer had enough patients to support these physicians.  As a
     result, one physician never worked at the site, one physician
     worked a brief period and then went to practice at a prison in
     Michigan, and one physician remained to work for the new
     employer after the practice was sold.  INS officials said that
     waivers had been approved for all three physicians, including
     the one who was never employed there.  Before we notified them,
     HUD officials were unaware that the facility had been sold and
     that two of the physicians were not practicing there. 

We also found instances in which the reason for not meeting the
requirements of an agreement resulted from the physician's actions. 
For example, in two separate cases, physicians were fired when they
refused to complete the requirement for working 40 hours a week at
the requesting facility.  In one instance, the fired physician
notified USDA that he was going to practice at another hospital and
when USDA officials told him he could not because the hospital was
not in a shortage area, the physician broke off contact with them. 
The facility official said that he had heard that the physician was
pursuing additional graduate medical education in the United States. 
In the second instance, the facility reported the physician's firing
directly to INS, which revoked his nonimmigrant work status. 

Reviews conducted by ARC's Inspector General have disclosed similar
instances in which conditions of agreements were not met.  Six of
eight reviews conducted by the Inspector General from 1994 to 1995
found that contrary to ARC policy, some physicians were not
practicing primary care at least 40 hours per week in a Health
Professional Shortage Area.  Instead, employers were using the
physicians in subspecialty practices or in locations not designated
as shortage areas. 


--------------------
\21 This location is in a state-designated shortage area, which has a
lower physician-to-population ratio than a federally designated area. 


      MONITORING VARIES AMONG
      FEDERAL AGENCIES AND STATES
---------------------------------------------------------- Letter :5.3

Agency controls to help ensure that physicians comply with waiver
agreements vary among the federal agencies and states.  These
controls range from periodic reports and site visits, to reliance on
employers to enforce the employment contracts.  For example, ARC
requires the facilities to verify and the waiver physicians to
certify that they are complying with ARC policies.  In addition, the
ARC Inspector General conducts site visits to the physicians'
practice locations.  In contrast, while HUD and USDA officials said
that they had started or planned to start requiring periodic reports,
officials at both agencies said that they do not have the staff
resources to monitor physician compliance.  These officials said that
because the use of waivers to address physician shortages is not
authorized or funded as a program, their agencies do not have the
resources available to effectively manage it as a program. 

In its site visits to monitor compliance, ARC's Inspector General
attributed most of the problems identified to the employers. 
However, for waivers requested through both federal agencies and
states, the applicable federal laws and regulations do not specify
penalties against employers that fail to comply with agency policies. 
ARC tries to address this shortcoming by requiring employers to sign
a statement certifying that they will comply with the waiver policy,
and applications from employers found to be in violation of the
policy receive additional scrutiny to ensure that the problems have
been corrected. 


   PROPOSED REGULATIONS AND RECENT
   LEGISLATION COULD IMPROVE
   COORDINATION AND ENFORCEMENT
------------------------------------------------------------ Letter :6

The growth in the number of waiver physicians has not gone unnoticed
by federal agency officials and legislators.  They have recently
taken actions that could address some of the coordination and
compliance problems identified.  A group of federal agency officials
has met informally to discuss waiver requests and USIA has proposed
regulations to make the waiver requests more consistent.  In
addition, recent amendments to the Immigration and Nationality Act
impose additional requirements for waivers obtained through federal
agencies.  The new regulations, if finalized, and the 1996 amendments
could address many of the coordination and compliance problems, but
not all of them. 


      AGENCY EFFORTS ARE UNDER WAY
      TO IMPROVE COORDINATION
---------------------------------------------------------- Letter :6.1

Recognizing the need for better coordination, officials from USIA,
INS, HHS, and the requesting federal agencies have been meeting since
late 1995 to discuss the use of waivers to address physician
shortages.  The officials formed an informal interagency group that
has discussed revising regulations addressing waiver requests.\22
USIA, in working with the other agencies, published a proposed
regulation in the Federal Register on September 5, 1996.\23 In the
preamble to the proposed regulation, USIA noted that with the entry
of USDA and HUD into the waiver process, inconsistency in the
administration of waiver requests among the different agencies has
created some confusion.  For a request by a U.S.  government agency,
the regulation would condition approval on the physician's commitment
to practice primary care for at least 3 years in a designated Health
Professional Shortage Area or a Medically Underserved Area or to
practice psychiatric care in a mental health Health Professional
Shortage Area.  To prevent physicians from shopping between agencies,
the foreign medical graduate would have to certify that he or she is
only requesting a waiver through one agency. 


--------------------
\22 DOT, on the other hand was not included in this interagency
group.  DOT has only requested waivers for one location and does not
have formal agency policies regarding the waivers. 

\23 See 61 Fed.  Reg.  46,745 (1996). 


      RECENT AMENDMENTS REQUIRE
      MORE CONSISTENT POLICIES
---------------------------------------------------------- Letter :6.2

The Omnibus Consolidated Appropriations Act, 1997,\24 included
amendments to the Immigration and Nationality Act that create greater
consistency among waiver efforts by subjecting state and federally
sponsored waiver physicians to the same statutory requirements.  The
amendments strengthen penalty provisions for federally sponsored
waiver physicians by prohibiting them from obtaining permanent
residence or U.S.  citizenship without completing the required 3-year
agreement.  If they fail to complete the 3-year agreement, they must
fulfill the 2-year foreign residence requirement.\25 These changes
(1) make the waiver conditions much more consistent, which may help
to alleviate the confusion cited by agency officials, and (2) help to
strengthen controls with regard to penalties for waivers requested
through federal agencies. 


--------------------
\24 P.L.  104-208 (1996). 

\25 Physicians whose waivers were obtained through states have been
subject to these requirements since 1994. 


      SOME PROBLEMS WOULD REMAIN
      UNADDRESSED
---------------------------------------------------------- Letter :6.3

While the efforts of the interagency group and enactment of the 1996
amendments should improve coordination of the waiver requests for
physicians with J-1 visas, they will leave several problems
unaddressed.  Specifically, they do not address the following issues: 

  -- Fully coordinating with other underservice programs or with
     waiver requests by other agencies.  The amendments neither
     designate an agency as responsible for managing the waivers nor
     require the waivers to be coordinated with HHS programs such as
     NHSC or the Community Health Center program.  Among federal
     agencies and states requesting the waivers, the problems of
     overlapping jurisdictions and the lack of information on the
     practice locations of waiver physicians could result in more
     physicians practicing in an area than are needed, as identified
     by HHS; a continued need for physicians in other areas; and a
     lack of coordination with state efforts to address physicians
     shortages.  In addition, although HHS has started to collect
     information on the number of physicians practicing under waivers
     in an area, there is no directive for this information to be
     used or shared in making decisions on waivers for physicians or
     other federal assistance. 

  -- Ensuring that the use of waivers for physicians is a last
     resort.  In an effort to ensure that the employers have a true
     need for a physician, ARC, USDA, and HUD policies, as well as
     the proposed USIA regulations, require the facilities to provide
     some documentation of past recruitment efforts.  This procedure,
     however, does not ensure that the use of waivers for physicians
     is the option of last resort for areas with physician shortages. 
     In some cases it appears that other qualified physicians are
     available, but the facility prefers to hire the physicians with
     J-1 visas.  For example, officials from one multispecialty
     clinic told us that they interviewed several applicants for a
     specialist physician position, including candidates who were not
     under J-1 visas, but they chose the physician with a J-1 visa
     and obtained a waiver because he was the most qualified.  The
     use of waivers is now a ready means for acquiring physicians,
     some of whom are being actively marketed by the physicians
     themselves or placement specialists such as recruiters.  The
     current statute and regulations do not require waivers to be
     used only as a last resort. 

  -- Monitoring compliance.  It is unclear whether agencies would
     devote sufficient resources to effectively monitor compliance. 
     USDA, for example, relies on employers to enforce the employment
     contracts, citing a lack of staff resources to conduct its own
     monitoring.  However, as we and ARC's Inspector General found,
     many of the examples of physicians who failed to comply with
     agency policies resulted from actions taken by the employers. 
     As a result, a reliance on employers to do the policing does not
     appear adequate to prevent the kinds of situations we found. 
     HUD officials also said that their monitoring efforts were
     limited by the availability of staff resources. 

  -- Addressing the needs of the medically underserved.  Under
     existing procedures, locating a waiver physician in a medical
     shortage area is no guarantee that the needs of the underserved
     will be addressed.  An area's underserved may be only a specific
     part of the population (such as migrant workers or low-income
     people), and not all federal agencies' and states' policies
     contain requirements or monitoring to ensure that a physician's
     practice includes such groups.  For example, if the underserved
     part of the population is low-income, the requesting agencies'
     and states' policies do not all require that a waiver physician
     in such an area accept Medicaid, have a sliding fee scale, or
     accept anyone for services regardless of his or her ability to
     pay.  In one area where the identified need was care for migrant
     farm workers, a waiver physician was in a group practice a block
     away from a federally funded migrant health center.  A senior
     official at the migrant health center said that the waiver
     physician did not impact the center's patient load because they
     both served different patient populations. 

  -- Establishing penalties against a facility for failing to comply
     with agency policies.  The new regulations and the 1996
     amendments do not establish any penalties for employers who fail
     to comply.  The ARC Inspector General noted that the most
     significant programmatic issue that surfaced during that
     office's review was the limited accountability of employers and
     the lack of potential actions against employers who did not use
     physicians with waivers in accordance with the intended purposes
     noted in the program. 


   CONCLUSIONS
------------------------------------------------------------ Letter :7

The use of waivers for physicians with J-1 visa requirements has
become so extensive that this exception policy now resembles a
full-fledged program for addressing medical underservice in the
United States.  Many health care facilities and states cite examples
of the utility of these waivers in providing a qualified physician
for an underserved area.  However, while the agencies involved in
processing the waivers are operating with the best of intentions, the
growing use of waivers is not being managed as a program, and this is
having detrimental results. 

  -- Federal efforts to address physician shortages are not
     coordinated among the federal agencies or with the states. 
     Several agencies, including those not traditionally involved in
     physician supply issues, have set up de facto physician supply
     programs using their existing authority and agency resources. 

  -- Despite some improvements, monitoring efforts to ensure that
     physicians fulfill the terms of their agreements remain spotty. 

  -- Accountability for reducing the actual conditions of
     underservice is limited.  Physicians can practice in underserved
     areas but not actually target their efforts to that part of the
     population that is underserved. 

The rapid growth in waivers for physicians makes this an opportune
time for the Congress to reassess what it wants the waiver provision
to accomplish.  The running disagreement between HHS and other
federal agencies about the role of waivers in addressing physician
shortages in underserved areas needs resolution, and better
coordination and management of the overall effort are needed if it is
to be continued. 


   MATTERS FOR CONGRESSIONAL
   CONSIDERATION
------------------------------------------------------------ Letter :8

If the Congress wants to continue to address medical underservice in
the United States through the use of waivers for physicians with J-1
visa requirements, it should consider requiring that the use of such
waivers be managed as a program.  Specifically, the Congress should
consider the following: 

  -- Clarifying how the use of waivers for these physicians fits into
     the overall federal strategy to address medical underservice. 
     This should include determining the size of the waiver program
     and establishing how it should be coordinated with other federal
     programs. 

  -- Designating leadership responsibility for managing the program. 
     This responsibility could be given to a single federal agency,
     such as HHS; to several federal agencies, for example, through a
     memorandum of understanding; or it could be delegated to the
     states. 

  -- Establishing penalties against facilities that fail to comply
     with requirements of the waiver. 

  -- Directing the entity(ies) managing the program to implement
     procedures and criteria for the selection and placement of
     physicians and for monitoring compliance with waiver
     requirements.  These procedures and criteria could include
     requiring the state to clearly support the use of the physician
     for addressing unmet need and to show that it has sought other
     options for fulfilling this need. 


   AGENCY COMMENTS AND OUR
   EVALUATION
------------------------------------------------------------ Letter :9

We provided a draft copy of this report to seven agencies that are
involved with waivers for physicians to practice in underserved
areas. 

  -- ARC, USDA, and USIA provided formal written comments (see apps. 
     VIII, IX, and X).  These comments indicate general agreement
     with our conclusions and matters for congressional
     consideration. 

  -- HUD and Justice (the parent department for INS) chose not to
     provide formal comments.  However, we discussed our findings
     with HUD and INS officials, and they raised no objections to our
     findings or matters for congressional consideration.  DOT has
     had limited involvement in waivers for physicians with J-1 visas
     and did not have comments on the draft report. 

  -- HHS did not submit formal comments by the end of our 30-day
     comment period.  However, the Director of the department's
     Office of International Affairs (who also chairs the
     department's Exchange Visitor Waiver Review Board) informed us
     that his office had fully reviewed the draft report and was in
     general agreement with the findings.  Regarding our matters for
     congressional consideration, he said that HHS favored the option
     of delegating responsibility for the waivers to the states. 

The three agencies that provided formal written comments also
expressed their support for the need for better coordination between
the participating agencies, states, and other programs to address
medical underservice.  One agency, USDA, also expressed concern about
the lack of available funding to operate its program effectively. 
USDA suggested that an alternative to funding the program from
appropriated research funds would be to initiate a fee-for-service
type application fee to offset operational costs, which would require
legislation to authorize the collection and utilizations of fees. 

We concur that any entity involved in managing waiver requests for
physicians should commit adequate resources for oversight and
operational support to ensure that the physicians address unmet needs
for physician resources.  Although we did not examine financing
options for managing the waivers in our review, we did note that a
few states, such as Michigan, have been requiring user fees of up to
$500 per application. 

We also received comments on technical matters from several of the
agencies, which we considered in preparing our final report. 


---------------------------------------------------------- Letter :9.1

We are sending copies of this report to the Secretaries of
Agriculture, Health and Human Services, Housing and Urban
Development, and Transportation, as well as the Director of the
United States Information Agency, the Federal Co-Chairman of the
Appalachian Regional Commission, and the Attorney General.  We also
will make copies available to others on request.  Please contact me
on (202) 512-7119 if you or your staff have any questions.  Major
contributors to this report are listed in appendix XI. 

Bernice Steinhardt
Director, Health Services
 Quality and Public Health Issues

List of Addressees

The Honorable Nancy L.  Kassebaum
Chairman
The Honorable Edward M.  Kennedy
Ranking Minority Member
Committee on Labor and Human Resources
United States Senate

The Honorable Alan K.  Simpson
Chairman
The Honorable Edward M.  Kennedy
Ranking Minority Member
Subcommittee on Immigration
Committee on the Judiciary
United States Senate

The Honorable Michael Bilirakis
Chairman
The Honorable Henry A.  Waxman
Ranking Minority Member
Subcommittee on Health and Environment
Committee on Commerce
House of Representatives

The Honorable Lamar S.  Smith
Chairman
The Honorable John Bryant
Ranking Minority Member
Subcommittee on Immigration and Claims
Committee on the Judiciary
House of Representatives


SCOPE AND METHODOLOGY
=========================================================== Appendix I

To accomplish our objectives, we interviewed (1) federal agency
officials responsible for requesting the waivers at ARC, HUD, USDA,
and DOT; (2) HHS officials in the department's Office of
International Affairs and the Health Resources and Services
Administration; (3) officials responsible for processing the waiver
requests at USIA and INS, including INS service centers; (4)
officials from the Department of Labor and the State Department; and
(5) officials from the Educational Commission for Foreign Medical
Graduates (ECFMG), the National Association of Community Health
Centers, the American Medical Association (AMA), the Council on
Graduate Medical Education (COGME), and the U.S.  Commission on
Immigration Reform.  We also reviewed relevant legislation, studies,
and policy documents and conducted two mail surveys:  one of the
states regarding the use of waivers of the J-1 visa foreign residence
requirement for physicians in their states, and another of the
facilities that requested such waivers for physicians.  We obtained
and analyzed data on requests for waivers for physicians from USIA
and the requesting federal agencies and reviewed a small sample of
case files. 

We also visited three states--Washington, Texas, and Georgia.  We
selected these three states for a cross-section of states where
waiver physicians were practicing:  Washington was quick to establish
a state program; Texas had a large number of physicians with waivers
through federal agencies but the state was not requesting waivers;
and Georgia had a state program as well as physicians whose waivers
were requested through ARC, HUD, and USDA.  During our site visits,
we met with state and other health officials, visited 14 sites where
waiver physicians were practicing, and interviewed health care
facility officials and 20 physicians who received waivers.  We
selected the sites in order to visit physicians in a variety of
practice settings, including federally funded community and migrant
health centers, a health center serving residents in public housing,
city and county health departments, a capitated-rate program for the
Medicare- and Medicaid-eligible elderly, and private and group
practices affiliated with both public and for-profit hospitals. 

We conducted our work between November 1995 and September 1996 in
accordance with generally accepted government auditing standards. 


   NUMBER OF WAIVERS
--------------------------------------------------------- Appendix I:1

To determine the number of waivers for physicians granted at the
request of ARC, USDA, and HUD, we requested copies of the agencies'
databases.  Each database contained information about when the agency
requested that USIA recommend the waiver.  We used the date that the
agencies sent the request to USIA in our calculations because neither
USIA nor INS has a cost-effective means of identifying waiver
requests by occupation and USIA and INS officials said that they
recommended or approved virtually all the physician waiver requests
made by the interested U.S.  government agencies.  While we did not
review the agencies' computer-based systems, we did review the
requesting agencies' data for consistency and accuracy and
selectively compared the agency data with that held by USIA.  We
obtained information on the waiver requests made by DOT from its
Office of the General Counsel.  We obtained information on state
requests for waivers from our survey of states regarding waivers for
physicians and follow-up telephone calls to state officials.  Our
scope did not include waiver requests from VA or requests from other
agencies for physicians to conduct research. 

Because the agencies requesting waivers do not consistently track the
practice dates of the physicians, we could not identify the number of
physicians in practice at any given point in time.  Instead, we used
the dates that the agencies and states submitted their requests for
waivers to USIA and assumed that those physicians whose waivers were
requested in 1994 or 1995 were either already practicing at the
facility listed in agency data on December 31, 1995, or had their
waivers in process to begin practicing shortly thereafter.  We
compared this number with (1) the number of physicians needed to
remove the primary care Health Professional Shortage Area
designations in the state on December 31, 1995, and (2) the number of
NHSC physicians (who received NHSC scholarships or NHSC federal loan
repayment in return for practicing in an underserved area) who were
practicing on December 31, 1995.  We obtained these data from HHS'
Health Resources and Services Administration.  We also compared the
number of waivers with the number of NHSC physicians practicing in
underserved areas on September 30, 1995, including NHSC physicians
who did not have NHSC scholarship or federal loan repayment
obligations. 

To estimate the number of physicians who completed graduate medical
education and training in 1995 who would be subject to the 2-year
foreign residence requirement, we subtracted the number of exchange
visitor physicians who were continuing applicants in the 1995-96
academic year from the number of physicians sponsored by ECFMG in the
prior academic year.  While this number is not exact because it may
include a small number of physicians who were involved in research
and some physicians who did not complete their training, it does
represent a reasonable estimate of the number of exchange visitor
physicians with J-1 visas who completed graduate medical education or
training who would be required to return home without a waiver to
remain in the United States.  The number of waiver requests for
physicians to practice in underserved areas that the agencies sent to
USIA in 1995 (1,374) is about 64 percent of this figure.  Therefore,
we estimate that half of the physicians who were supposed to return
home after completing their graduate medical education or training
received waivers to practice in underserved areas in the United
States instead. 


   SURVEY OF HEALTH CARE
   FACILITIES
--------------------------------------------------------- Appendix I:2

To identify characteristics of the physicians who received waivers of
the J-1 visa foreign residence requirement and to measure the
compliance and retention of these physicians, we selected a random
sample of 40 from 355 physicians for whom ARC requested waivers
between 1990 and 1992.  Because most federal agencies only began
requesting waivers in the past several years, we also selected a
random sample of 211 of 1,994 physicians for whom ARC, DOT, HUD, and
USDA received waiver requests in 1994 and 1995 (this was a stratified
sample, including 40 of 362 ARC requests; 2 of 2 DOT requests; 49 of
477 HUD requests, and 120 of 1,153 USDA requests).  We sent a
questionnaire to the contact person at the facility that had
requested the waivers, using the information provided by the federal
agencies.  For each physician, we asked the contact person to tell us
(1) if the physician worked or planned to work at the facility; (2)
if the physician was working at the facility as of January 1, 1996;
(3) if the physician left and the date he or she stopped working at
the facility; (4) whether or not the physician obtained permanent
residency during his or her employment; and (5) the physician's
medical specialty, subspecialty, and practice setting.  We received
responses for 39 of the 40 physicians in our 1990 to 1992 ARC sample
and for 200 of 211 physicians in our 1994 to 1995 samples (38 of 40
ARC physicians, 2 of 2 DOT physicians, 49 of 49 HUD physicians, and
111 of 120 USDA physicians). 

We used the survey results of the 1990 to 1992 ARC sample to estimate
the rate of completion of ARC's required 2-year contract among all
waiver physicians whose waivers were requested between 1990 and 1992. 
We counted those physicians who worked for at least 1.75 years as
meeting the ARC minimum contract period at that time, which was 2
years.  We used 1.75 years of practice as our measure of compliance
to allow for vacation and other leave.  At a 95-percent confidence
level, the rate of compliance among the 1990 to 1992 requests is at
least 80 percent and the percent still at the requesting facility on
January 1, 1996, is at least 19 percent. 

We used the survey results of the 1994 to 1995 samples to estimate
the rate of compliance, to date, of physicians whose waiver requests
were received by ARC, DOT, HUD, and USDA from 1994 to 1995.  We
counted those physicians who were working on January 1, 1996, for the
facility listed in agency data as in compliance.  At a 95-percent
confidence level, the rate of compliance among the 1994 to 1995
requests (those practicing on January 1) is at least 93 percent. 

We also used the survey results of the 1994 to 1995 samples to
estimate the practice specialties and practice settings of physicians
who were practicing on January 1, 1996.  For this analysis, we
included those 150 physicians who were practicing on January 1, 1996,
for the facilities listed by the agency.  The estimates at the
95-percent confidence intervals are shown in tables VI.2 and VI.3. 

We also obtained comments on the use of waivers for physicians from
the survey respondents. 


   SURVEY OF STATES REGARDING
   WAIVERS FOR PHYSICIANS WITH J-1
   VISAS
--------------------------------------------------------- Appendix I:3

To identify the states' participation in requesting waivers for
physicians, we used a questionnaire for information on (1) whether or
not the state had requested or planned to request waivers for
physicians with J-1 visas in fiscal years 1995 and 1996, and (2) the
state's involvement in waivers for these physicians.  We sent a
questionnaire to the contact person provided by USIA or the official
responsible for public health issues in all 54 eligible
jurisdictions, including the 50 states, the District of Columbia,
Guam, Puerto Rico, and the U.S.  Virgin Islands.  Each state reported
on the number of waivers requested by the state, if any; factors
considered in state requests; monitoring activities; and state
involvement in requests for waivers made by federal agencies.  The
respondents also commented on the use of waivers for physicians to
address medical underservice and provided a copy of their state's
written policies, if any, regarding these waivers. 

In addition, to obtain information on the number of waivers for
physicians requested by the states in 1995, we telephoned officials
at those states that indicated they had requested waivers in fiscal
years 1995 or 1996. 


   COORDINATION
--------------------------------------------------------- Appendix I:4

To determine the conditions attached to the waivers, we interviewed
state and federal agency officials, reviewed their written waiver
policies, and analyzed the results of our state survey. 

To look at coordination of physician placements, we cross-tabulated
the agency data on waiver requests received by the agencies between
1994 and 1995 by state and selected those physicians whose waiver
requests were sent to USIA between 1994 and 1995.  We obtained the
number of physicians who were NHSC scholarship or federal loan
repayment recipients who were practicing in each state as of December
31, 1995, from HHS' Bureau of Primary Health Care.\26 We added the
number of waiver physicians and NHSC physicians and compared them
with the number of full-time-equivalent physicians needed to remove
primary care Health Professional Shortage Area designations in that
state as of December 31, 1995.  We used the shortage area
dedesignation level because it is the primary measurement used by HHS
and the requesting agencies to establish the need for physicians.\27

We used USIA's data file to identify those locations for which more
than one agency requested waivers for physicians and checked the
requesting agencies' data to see if they showed a request for that
practice location. 


--------------------
\26 For this analysis, we did not include physicians practicing under
the NHSC state loan repayment program or the community scholar
program, because data on the number of these physicians practicing in
each state on December 31, 1995, were not readily available from HHS. 
If these physicians were included, the number of NHSC physicians in
practice on December 31, 1995, would increase. 

\27 We used the Health Professional Shortage Area designation as a
measure of need for this reason.  However, our prior work found
problems with HHS' shortage area designations.  Our report,
GAO/HEHS-95-200, Sept.  8, 1995, discusses these problems in detail. 


   COMPLIANCE
--------------------------------------------------------- Appendix I:5

We identified instances where physicians did not comply with the
terms of the waiver through (1) discussions with the ARC Inspector
General and a review of reports from that office, (2) our survey of
facilities where requesting agencies believed that the physicians
were practicing, (3) site visits to facilities where the physicians
were supposed to be practicing, and (4) discussions with USIA and
other agency officials.  If a facility indicated that the physician
never worked there, we contacted the facility, INS, or both to obtain
information on the reason the physician never worked there and to
confirm that a waiver had been granted.  We also reviewed case files
at the requesting agencies and USIA to check for documentation, if
any, of the physician's departure from the facility or noncompliance. 
For physicians that did not work at or left the facilities, we tried
to locate the physician through AMA data; the unique provider
identification number database, which is maintained by the Medicare
program; telephone listings; state licensing boards; and other
sources. 


EXCHANGE VISITORS IN GRADUATE
MEDICAL EDUCATION IN THE UNITED
STATES
========================================================== Appendix II

Exchange visitors are only a portion of physicians in graduate
medical education programs.  As shown in table II.1, about 1 in 10
physicians in programs accredited by ACGME was an exchange visitor in
August 1995.  Of those who were international medical
graduates--physicians who did not graduate from U.S.  or Canadian
medical schools--about 1 in 3 was an exchange visitor.  Only these
exchange visitor physicians are subject to the J-visa 2-year foreign
residence requirement.  Hence, while policy changes regarding waivers
for exchange visitors will affect more than one-third of the
international medical graduates in graduate medical education or
training, most international medical graduates will not be affected. 



                               Table II.1
                
                  Immigration Status of Physicians in
                ACGME-Accredited and Combined Specialty
                        Programs, August 1, 1995

                                                        International
                                                           medical
                                                           graduate
                                                        physicians\a,
                                        All physicians        b
                                        --------------  --------------
                                                Percen          Percen
Immigration status                      Number       t  Number       t
--------------------------------------  ------  ------  ------  ------
Exchange visitor (J-visa)                9,573     9.8   9,183    36.8
Nonimmigrant (H-visa)                    2,618     2.7   2,363     9.4
Permanent U.S. resident                  8,937     9.1   6,985    28.0
Naturalized U.S. citizen                 8,730     8.9   1,973     7.9
Native U.S. citizen                     61,886    63.1   2,057     8.2
Refugee                                    963     1.0     862     3.4
Unknown                                  4,501     4.6     980     3.9
Miscellaneous\c                            827     0.8     579     2.3
======================================================================
Total                                   98,035          24,982
----------------------------------------------------------------------
Note:  Percent columns may not total 100 because of rounding. 

\a Does not include graduates of Canadian medical schools. 

\b Medical school type was not indicated for 454 residents (0.5
percent of all residents). 

\c Includes temporary visitors on B-2 visas and students on F-1
visas. 

Source:  AMA. 


WAIVER OF THE FOREIGN RESIDENCE
REQUIREMENT FOR EXCHANGE VISITORS
========================================================= Appendix III

Under the Mutual Educational and Cultural Exchange Act of 1961,\28
the Director of USIA establishes programs intended to promote mutual
understanding between the people of the United States and other
countries by means of educational and cultural exchanges.  Under
these exchange visitor (J-1 visa) programs, designated organizations
sponsor nonimmigrant aliens' temporary visits to the United States
for the purposes of teaching, instructing or lecturing, studying,
observing, conducting research, consulting, demonstrating special
skills, or receiving training.  ECFMG is the designated sponsor for
exchange visitors participating in graduate medical education.\29
After completing this program, it is expected that participants will
return to their home countries and impart what they have learned and
experienced to the people of their country. 

Section 212(e) of the Immigration and Nationality Act\30 requires
that certain J-1 visa program participants, including participants in
graduate medical education, reside at least 2 years in the countries
of their nationalities or last residences after leaving the United
States.  They must meet this requirement before they are eligible to
apply for nonimmigrant visas (H and L) as temporary workers, for
permanent residencies in the United States, or as immigrants. 


--------------------
\28 P.L.  87-256 (1961). 

\29 To be eligible for ECFMG sponsorship, foreign physicians must
pass a medical science examination and meet English-language
requirements, fulfill minimum medical education requirements, and
have a contract for a position in a program accredited by ACGME. 

\30 8 U.S.C.  1182(e) (1994). 


   HISTORY OF THE 2-YEAR FOREIGN
   RESIDENCE REQUIREMENT
------------------------------------------------------- Appendix III:1

There was no 2-year foreign residence requirement or waiver provision
in the exchange visitor program authorized with the passage of the
U.S.  Information and Educational Exchange Act of 1948.\31 The act
required participants to depart the United States after completing
their programs.  The 2-year foreign residence requirement and its
related waiver provision evolved through a number of legislative
changes after the exchange visitor program was authorized in 1948. 

In 1956, the Congress amended the 1948 act to require that
participants reside in and be physically present in their home
countries or cooperating countries for at least 2 years before
applying for immigrant visas, nonimmigrant H visas, or adjustments of
status to permanent resident.  In recommending this amendment, the
Senate Committee on Foreign Relations stated that it was needed to
counteract situations in which some participants were departing the
United States as required, going to Canada or Mexico, and immediately
returning to the United States on immigrant visas.  The Committee
stated that this defeated the primary objective of the exchange
program; that is, to impart participants' experiences in the United
States to the people of their country.  It further stated,

     "the amendment would make perfectly clear to all
     concerned...and, above all, the foreign nationals
     themselves--that the exchange program is not an immigration
     program and should not be used to circumvent the operation of
     the immigration laws."\32

The 1956 amendment also provided for a waiver of the foreign
residence requirement on the basis of a request from an interested
U.S.  government agency showing the waiver to be in the public
interest.\33

The Mutual Educational and Cultural Exchange Act of 1961, under which
the exchange visitor program now operates, contains a provision
amending the Immigration and Nationality Act, which established the
foreign residence requirement.  Under that provision, a participant
could reside for 2 years in a foreign country other than his or her
home country.  The act also provided for a waiver of the foreign
residence requirement (1) upon a determination that departure from
the United States would impose exceptional hardship on the
participant's spouse or child (who must be a U.S.  citizen or a
lawful resident alien) or (2) at the request of an interested U.S. 
government agency (after a favorable recommendation).  The conference
report states

     "To make available the services of exchangees who possess
     talents desired by our universities, foundations and other
     institutions, the language of the House bill was modified to
     permit the waiver of the foreign residence requirement on the
     request of an interested U.S.  Government agency."\34

An amendment to the foreign residence provision in 1970 removed the
blanket application of the foreign residence requirement for exchange
visitors and imposed it only on participants (1) whose participation
was financed in some way by the United States or their home countries
or (2) whose home countries clearly needed their services.\35 Also,
participants could no longer meet the 2-year foreign residence
requirement by residing in other foreign countries but had to reside
in the countries of their nationalities or their last foreign
residences before coming to the United States.  This requirement
still applies.  The 1970 act also established two additional bases
for waivers:  persecution because of race, religion, or political
opinion and statements by the participant's home countries that they
had no objections to the waivers.  These bases still apply except
that the statement of no-objection waiver is no longer available to
participants in graduate medical education or training. 


--------------------
\31 P.L.  80-402 (1948). 

\32 S.  Rep.  No.  1608, 84th Cong., 2d Sess.  2, 3 (1956). 

\33 P.L.  84-555 (1956). 

\34 H.  Conf.  Rep.  No.  1197, 87th Cong., 1st Sess.  17 (1961). 

\35 P.L.  91-225 (1970). 


   PARTICIPANTS IN GRADUATE
   MEDICAL EDUCATION OR TRAINING
   FACE MORE STRINGENT CONDITIONS
------------------------------------------------------- Appendix III:2

After 1970, changes to the foreign residence and waiver provisions
primarily strengthened restrictions on participants coming to the
United States for graduate medical education or training.  In 1976,
the Congress imposed restrictions on medical graduates' participation
in the exchange visitor program.  In the 1976 act, the Congress noted

     "that there is no longer an insufficient number of physicians
     and surgeons in the United States such that there is no further
     need for affording preference to alien physicians in admission
     to the United States under the Immigration and Nationality
     Act."\36

In light of this finding, the Congress tightened immigration laws for
foreign doctors and strengthened requirements affecting J-1 visa
program participants who were coming to the United States for
graduate medical education or training.  The latter were

  -- made subject to the 2-year foreign residence requirement whether
     or not their programs were financed by a government,

  -- made ineligible to apply for waivers on the basis of
     no-objection statements from their home countries,

  -- limited to 3-year stays in the United States,

  -- required to make a commitment to return to their home countries
     after completing their training, and

  -- required to provide written assurance by their home countries
     that after completing their training and returning home, they
     would be appointed to positions in which they would fully use
     the skills acquired in their education or training.\37

In 1981, USIA asked the Congress to extend the limit up to 7 years
for medical doctors to encourage them to study in the United States
rather than in a Communist country.  The House Committee on the
Judiciary questioned USIA officials regarding the likelihood that
physicians would be willing to return home after 7 years, during
which time they may have raised families in the United States.  The
Congress increased the usual permissible duration of stay to 7 years,
but it imposed additional requirements:\38

  -- Graduate medical education or training participants were
     required, as a continuing reminder, to furnish annual affidavits
     to INS attesting that they would return to their home countries
     upon completion of the education or training for which they came
     to the United States. 

  -- U.S.  officials were required to issue an annual report to the
     Congress on participants who had submitted affidavits, including
     their names and addresses, the programs in which they are
     participating, and their status in the programs. 

In reporting on this legislation, the House Committee on the
Judiciary "notes the flagrant abuse of the exchange program during
the past decade and seeks to alleviate possible `brain drain' from
various countries." It said that the affidavits were to ensure that
the physicians comply with the terms of their agreement.\39


--------------------
\36 P.L.  94-484 (1976). 

\37 P.L.  94-484. 

\38 P.L.  97-116 (1981). 

\39 H.R.  Rep.  No.  264, 97th Cong., 1st Sess.  16 (1981)


   STATE REQUESTS FOR WAIVERS
------------------------------------------------------- Appendix III:3

Amendment of the Immigration and Nationality Act in 1994\40
established another basis for physicians to obtain waivers of the J-1
visa foreign residence requirement.  Under the amendment, up to 20
waivers for physicians with J-1 visas may be granted at the request
of a state\41 department of public health or its equivalent each
fiscal year.  The law imposed several conditions for state-requested
waivers: 

  -- The alien physician must (1) demonstrate a bona fide offer of
     full-time employment at a health facility, (2) agree to begin
     employment at that facility within 90 days of receiving the
     waiver, and (3) agree to work there for at least 3 years while
     maintaining a nonimmigrant work status (H-1B visa).\42 (The
     physician's status as a nonimmigrant may not be changed until
     the employment contract is fulfilled.)

  -- The alien physician must agree to practice medicine for at least
     3 years in a geographic area or areas designated by the
     Secretary of HHS as having a shortage of health care
     professionals. 

  -- If the alien physician is otherwise contractually obligated to
     return to a foreign country, that country's government must
     furnish a statement to the Director of USIA that it has no
     objection to a waiver. 

  -- If the physician fails to fulfill the contract, he or she must
     reside and be physically present in the country of his or her
     nationality or last residence for at least 2 years after
     departing the United States before becoming eligible to apply
     for an immigrant visa, for permanent residence, or for any other
     change of nonimmigrant status

The 1994 amendments apply only to exchange visitors who were admitted
to the United States under a J-visa or acquired J-visa status before
June 1, 1996. 


--------------------
\40 P.L.  103-416 (1994). 

\41 "The term state includes the District of Columbia, Puerto Rico,
Guam, and the U.S.  Virgin Islands.  8 U.S.C.  1101(a)(36)(1994). 

\42 The Attorney General may determine that extenuating
circumstances, such as the closure of the facility or hardship to the
alien, would justify a period of less than 3 years. 


   1996 AMENDMENTS
------------------------------------------------------- Appendix III:4

Other amendments to the Immigration and Nationality Act regarding
waivers for physicians with J-1 visas were passed in the 104th
Congress.  The amendments were included in the Omnibus Consolidated
Appropriations Act, 1997,\43 and (1) impose additional requirements
for waivers requested by interested U.S.  government agencies, and
(2) extend authorization for waivers for aliens entering the United
States with a J-visa or acquiring such status through May 31, 2002. 

The amendments subject physicians seeking waivers through interested
U.S.  government agencies to some of the same requirements as those
sponsored by state agencies.  For example, the amendments require
such physicians to (1) agree to work for at least 3 years for the
health facility named in the application, (2) work in an area
designated by the Secretary of HHS as having a shortage of health
care professionals, (3) begin work within 90 days of receipt of the
waiver, and (4) maintain a nonimmigrant status until their 3-year
commitment is completed.  Physicians who do not fulfill this
commitment become subject to the 2-year foreign residence
requirement. 



(See figure in printed edition.)Appendix IV

--------------------
\43 P.L.  104-208 (1996). 


RESULTS OF GAO QUESTIONNAIRE FOR
STATES REGARDING J-1 VISA WAIVERS
FOR PHYSICIANS
========================================================= Appendix III



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)


WAIVER REQUESTS FOR PHYSICIANS
WITH J-1 VISAS, BY STATES AND
FEDERAL AGENCY, 1990-95
=========================================================== Appendix V

                         Waivers requested by federal
                                   agencies
                        ------------------------------
                Waiver
                     s
                reques
                ted by
                states
Year                \a     DOT     ARC     HUD    USDA      Total
--------------  ------  ------  ------  ------  ------  ==============
1990                                70                        70
1991                               121                       121
1992                               164                       164
1993                         2     266               6       274
1994                         1     217       9     268       495
1995                89       1     157     375     752      1,374
======================================================================
Total               89       4     995     384   1,026      2,498
----------------------------------------------------------------------
Note:  Determined on the basis of the date the agency sent the
request to USIA.  USIA officials said that they recommend virtually
all waiver requests and INS officials said that they approve
virtually all waiver requests that have a favorable USIA
recommendation. 

\a States were first authorized to request waivers in October 1994.