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Report: U.S. to pay hospitals not to train doctors
August 24, 1997
Web posted at: 10:22 a.m. EDT (1422 GMT)WASHINGTON (CNN) -- In an effort to reduce a glut of physicians in the United States, the federal government will pay training hospitals hundreds of millions of dollars not to train doctors, The Washington Post reported Sunday.
The initiative, part of the new federal budget agreement, also for the first time essentially forbids hospitals from increasing the size of their residency programs, the paper reported.
Medicare underwrites residency training programs heavily. Taxpayers spend $7 billion a year on the training, with each resident translating into an average subsidy of $100,000 a year.
IN CONTEXT Medicare spends up to $7 billion a year on physician training programs. But with one physician for every 380 people in the United States, critics say the government is paying for more doctors than it needs.
Under the new plan, Medicare will instead pay hospitals to shrink their residency programs. Hospitals that voluntarily reduce residency training programs by 20 to 25 percent over five years will get the full amount of the lost subsidies for the first two years, with payments tapering off over the next three years, the newspaper said.
After five years, the payments will cease, leaving the program with fewer residents to underwrite. Administration health officials and leading Republicans say the program will save Medicare money in the long run, the Post reported.
The payments are the government's first effort to constrict the pipeline of people entering the medical profession, and one of the few times the federal government has used subsidies as leverage to shrink a particular work force.
New York tried program first
The program mirrors an experimental program in New York endorsed by the Clinton administration earlier this year.
Under the agreement between the Greater New York Hospital Association and the federal Health Care Financing Administration, which runs Medicare, New York is to receive $400 million over several years to train fewer doctors, especially in those in certain specialties.
Of the state's 75 teaching hospitals, the Post reported, 42 signed up for the program -- nearly four times as many as expected.
But the agreement drew fire from teaching hospitals in other areas of the country who were cutting their residency rolls voluntarily and absorbing the cost of the lost subsidies without federal assistance.
Some say agreement may have been unnecessary
Some government officials quoted by the Post said the glut of doctors, particularly specialists, in the United States was a growing problem, and argued that the budget agreement was a valuable cost-cutting tool. "It remains a voluntary matter of choice for these teaching hospitals. It isn't a mandate," said Ari Fleischer, a spokesman for committee chairman Rep. Bill Archer, R-Texas.
Others wondered whether it was necessary. The number of doctors training to become specialists in some fields has declined dramatically despite the subsidy program, the Post article said, due to well-publicized warnings that jobs for specialists were only available in less populated areas.
The United States boasts over 700,000 physicians, more per capita than any other country.
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