Graduate Medical Education Report Sparks Controversy

The Institute of Medicine (IOM) is calling to overhaul the $15 billion graduate medical education (GME) system and the way the government pays for physician training.

In 2012, Medicare alone paid nearly $10 billion annually for residency training, with Medicaid funding $3.9 billion, the Department of Veterans Affairs contributing $1.4 billion and the Department of Health and Human Services’ Health Resources and Services Administration paying roughly half a billion dollars, according to a report from IOM’s expert panel.

Despite the fact Medicare contributes the lion’s share for the residency training of physicians, there are “minimal reporting requirements and no connection to outcomes,” according to the report.

IOM identified 6 goals for an improved GME financing system:

1. Encourage production of a physician workforce better prepared to work in, help lead, and continually improve an evolving healthcare delivery system that can provide better individual care, better population health, and lower cost.

2. Encourage innovation in the structures, locations, and designs of GME programs to better achieve Goal 1.

3. Provide transparency and accountability of GME programs, with respect to the stewardship of public funding and the achievement of GME goals.

4. Clarify and strengthen public policy planning and oversight of GME with respect to the use of public funds and the achievement of goals for the investment of those funds.

5. Ensure rational, efficient, and effective use of public funds for GME in order to maximize the value of this public investment.

6. Mitigate unwanted and unintended negative effects of planned transitions in GME funding methods.

To meet these goals, IOM recommended maintaining Medicare GME funding at its current level, building an infrastructure to facilitate strategic investment; and establishing a 2-part Medicare GME fund.

The American Academy of Family Physicians (AAFP) lauded IOM for its work to overhaul the 50-year-old GME system.

“We are most pleased to see recommendations in the GME payment structure that will decouple payments from Medicare patient case loads and shift funding away from the legacy hospital-based system to more community-based training sites; including allowing funding to go directly to those organizations that sponsor residency training,” AAFP President Reid Blackwelder, MD, said in a statement.

However, not all medical organizations were happy with IOM’s report. The Association of American Medical Colleges (AAMC) and the American Medical Association (AMA) both criticized the report because the proposed overhaul would fail to meet future patient needs.

While the AAMC did acknowledge the need for long-term, stable funding for training physicians, President and Chief Executive Officer Darrell G. Kirch said the radical overhaul would threaten training programs and jeopardize patients.

“While the current system can and is being improved to train more doctors in non-hospital settings, these immediate cuts will destabilize a system that has produced high-quality doctors and other health professionals for more than 50 years and is widely regarded as the best in the world,” Darrell G. Kirch, MD, president and chief executive officer of the AAMC, said in a statement.

According to Kirch, IOM’s proposed 35% reduction in payments to teaching hospitals slashes funding for care and services available almost exclusively at these facilities, including Level 1 trauma centers and access to clinical trials.

The AMA expressed its own concerns about the report and the need to recognize potential physician shortages across the country.

“Despite the fact that workforce experts predict a shortage of more than 45,000 primary care and 46,000 specialty physicians in the US by 2020, the report provides no clear solution to increasing the overall number of graduate medical education positions to ensure there are enough physicians to meet actual workforce needs,” Ardis Dee Hoven, MD, immediate past president of the AMA, said in a statement.

The AAMC shared those concerns about the future physician shortage and how it will affect patient care.

“By drastically cutting support to teaching hospitals, the IOM recommendations will worsen these projected shortages as teaching hospitals will be forced to make difficult choices between training more physicians for the future needs of the nation and maintaining life-saving clinical services for their communities,” Kirch said.

The AAMC is calling for a modest increase in federally supported GME training slots to help alleviate the physician shortage. Doing so will also provide time to develop team models of care.

“While the current system is far from perfect, the IOM’s proposed wholesale dismantling of our nation’s graduate medical education system will have significant negative impact on the future of healthcare,” Kirch concluded. “This is hardly the moment to use economic theory to experiment on a system that is integral to maintaining the health of all Americans.”