Residency programs across the country may have a few more slots for incoming residents due to a recent bump in Medicare funding.
Case in point: The University of Alabama at Birmingham (UAB). The state has one of the top stroke rates in the country, and yet UAB has the only hospital in the state training future doctors to help stroke patients recover. "Our hospital cares for Alabama's sickest patients, many who need rehabilitation services," said Craig Hoesley, MD, senior associate dean for medical education, who oversees graduate medical education (GME) or residency programs.
After decades of stagnant support, a recent bump in Medicare funding will allow UAB to add two more physical medicine and rehabilitation residents to the four residencies already receiving such funding.
Medicare also awarded UAB more funding last year to add an addiction medicine fellowship, one of two such training programs in the state for the specialty that helps treat patients fighting addiction.
UAB is among healthcare systems and hospitals nationwide benefiting from a recent hike in Medicare funding for residency programs after some 25 years at the same level of federal support. Medicare is the largest funder of training positions. Otherwise, hospitals finance training through means such as state support.
The latest round of funding, which went into effect in July, adds 200 positions to the doctor pipeline, creating more openings for residents seeking positions after medical school.
In the next few months, the Centers for Medicare & Medicaid Services (CMS) will notify teaching hospitals whether they'll receive the next round of Medicare funding for more residency positions. At that time, CMS will have awarded nearly half of the 1200 residency training slots Congress approved in the past few years. In 2020 — for the first time since 1996 — Congress approved adding 1000 residency slots at teaching hospitals nationwide. CMS awards the money for 200 slots each year for 5 years.
More than half of the initial round of funding focused on training primary care specialists, with other slots designated for mental health specialists. Last year, Congress also approved a separate allocation of 200 more Medicare-funded residency positions, with at least half designated for psychiatry and related subspecialty residencies to help meet the growing need for more mental health specialists. On August 1, CMS announced it would distribute the funds next year, effective in 2026.
The additional Medicare funding attempts to address the shortage of healthcare providers and ensure future access to care, including in rural and underserved communities. The Association of American Medical Colleges (AAMC) estimates the nation will face a shortage of up to 86,000 physicians by 2036, including primary care doctors and specialists.
In addition, more than 100 million Americans, nearly a third of the nation, don't have access to primary care due to the physician shortages in their communities, according to the National Association of Community Health Centers.
Major medical organizations, medical schools, and hospital groups have been pushing for years for increased Medicare funding to train new doctors to keep up with the demand for healthcare services and offset the physician shortage. As a cost-saving measure, Medicare set its cap in 1996 for how much it will reimburse each hospital offering GME training. However, according to the medical groups that continue to advocate to Congress for more funding, the funding hasn't kept pace with the growing healthcare needs or rising medical school enrollment.
Adding Residency Spots
In April, Hoesley of UAB spoke at a Congressional briefing among health systems and hospitals that benefited from the additional funding. He told Congressional leaders how the increased number of GME positions affects UAB Medicine and its ability to care for rural areas.
"We have entire counties in Alabama that don't have physicians. One way to address the physician shortage is to grow the GME programs. The funding we received will help us grow these programs and care for residents in our state."
Still, the Medicare funding is only a drop in the bucket, Hoesley said. "We rely on Medicare funding alongside other funding partners to train residents and expand our care across the state." He said many UAB residency programs are over their Medicare funding cap and would like to grow, but they can't without more funding.
Mount Sinai Health System in New York City also will be able to expand its residency program after receiving Medicare support in the latest round of funding. The health system will use the federal funds to train an additional vascular surgeon. Mount Sinai currently receives CMS funding to train three residents in the specialty.
Over a 5-year program, that means CMS funding will help train 20 residents in the specialty that treats blood vessel blockages and diseases of the veins and arteries generally associated with aging.
"The funding is amazing," said Peter L. Faries, MD, a surgery professor and system chief of vascular surgery at the Icahn School of Medicine at Mount Sinai, New York City, who directs the residency program.
"We don't have the capacity to provide an individual training program without the funding. It's not economically feasible."
The need for more vascular surgeons increases as the population continues to age, he said. Mount Sinai treats patients throughout New York, including underserved areas in Harlem, the Bronx, Washington Heights, Brooklyn, and Queens. "These individuals might not receive an appropriate level of vascular care if we don't have clinicians to treat them."
Of the recent funding, Faries said it's taken the residency program 15 years of advocacy to increase by two slots. "It's a long process to get funding." Vascular training programs can remain very selective with Medicare funding, typically receiving two applicants for every position," said Faries.
Pushing for More Funds
Nearly 98,000 students enrolled in medical school this year, according to the National Resident Matching Program. A total of 44,853 applicants vied for the 38,494 first-year residency positions and 3009 second-year slots, leaving 3350 medical school graduates without a match.
"There are not enough spots to meet the growing demand," said Jesse M. Ehrenfeld, MD, MPH, immediate past president of the American Medical Association. "Graduate medical education funding has not kept up."
Despite the increase in medical school graduates over the past two decades, Medicare-supported training opportunities remained frozen at the 1996 level. A limited number of training positions meant residency programs couldn't expand the physician pipeline to offset an aging workforce, contributing to the shortage. "The way to solve this is to expand GME," Ehrenfeld said. "We continue to advocate to remove the cap."
Ehrenfeld also told Medscape Medical News that he doesn't mind that Congress recently designated GME funding to certain specialties, such as psychiatry, because he believes the need is great for residency spots across the board. "The good news is people recognize it's challenging to get much through Congress." He's optimistic, though, about recent legislative efforts to increase funding.
AAMC, representing about a third of the nation's 1100 teaching hospitals and health systems, feels the same. Congress "acknowledges and continues to recognize that the shortage is not getting better, and one way to address it is to increase Medicare-supported GME positions," said Leonard Marquez, senior director of government relations and legislative advocacy.
Still, he said that the Medicare funding bump is only making a small dent in the need. AAMC estimates the average cost to train residents is $23 billion annually, and Medicare only funds 20% of that, or $5 billion. "Our members are at the point where they say: We already can't add new training positions," Marquez said. He added that without increasing residency slots, patient care will suffer. "We have to do anything possible we can to increase access to care."
Marquez also believes Medicare funding should increase residency positions across the specialty spectrum, not just for psychiatry and primary care. He said that the targeted funding may prevent some teaching hospitals from applying for residency positions if they need other types of specialists based on their community's needs.
Among the current proposals before Congress, the Resident Physician Shortage Reduction Act of 2023 would add 14,000 Medicare-supported residency slots over 7 years. Marquez said it may be more realistic to expect fewer new slots. A decision on potential legislation is expected at the end of the year. He said that if the medical groups aren't pleased with the decision, they'll advocate again in 2025.
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