IOM panel recommends new financing system for physician training

AHA News Now

An Institute of Medicine committee today recommended replacing Medicare’s separate funds for indirect and direct graduate medical education with one direct payment to program sponsors based on a geographically adjusted national per-resident amount. The report recommends maintaining aggregate support for Medicare GME at the current level while phasing out the current Medicare GME funding provided to hospitals over the next decade. Among other changes, the proposed system would allocate financing to two distinct funds. One fund would support currently approved residency positions and the other would support payment demonstrations (such as performance-based payment) and new training positions in priority disciplines and geographic areas. In addition, the committee calls for a new policy council to develop a strategic plan and federal policies for Medicare GME financing, and a new center at the Centers for Medicare & Medicaid Services to manage GME funds and ensure transparency. Linda Fishman, AHA senior vice president for public policy analysis and development, said, “Today’s report on graduate medical education is the wrong prescription for training tomorrow’s physicians. We are especially disappointed that the report proposes phasing out the current Medicare GME funding provided to hospitals and offering it to other entities that do not treat Medicare patients.”

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