Report points toward path for alternative GME funding

As physicians continue efforts to ensure a sufficient number of medical trainees are able to enter the physician workforce to stave off a predicted physician shortage, a new report takes a look at alternative funding sources for residency programs and offers steps that could be taken to expand existing graduate medical education (GME) programs and create new programs.

The report, written by the AMA Council on Medical Education and adopted Monday at the 2015 AMA Interim Meeting, notes that “given the scrutiny Medicare funding of GME has received of late, there may now be a greater prospect of developing a new payment system that could fund and shape a more appropriate physician workforce.”

The report examines several existing programs that have relied on private or other alternative funding for bolstering residency programs, highlighting a program in North Carolina as a successful example that could provide insight for other programs, health care systems and communities that are looking to expand their training opportunities.

The report suggests these steps for programs that are trying to expand their number of residency slots:

• Research state funding possibilities. Programs should look into how their state’s Medicaid funds are allocated, whether they support GME and how the allocation for GME is determined. In addition, states that have their own health insurance exchanges may have an option to use a tax on the exchange to help pay for local GME programs.
• Turn to philanthropic organizations. Programs should perform an exhaustive search of the philanthropic organizations and insurance company foundations in their state that support economic development or health care. Programs should reach out to these groups to discuss possible program expansion rather than waiting for them to issue requests for proposals.
• Consider partnering with employers. Local large employers may wish to supporting physician training if they understand that a pipeline of physicians is in their own interest.
• Work with local hospitals. Large hospitals or health care systems may recognize their dependency on an adequate pipeline of physicians and wish to ensure it continues in their area.

For localities that are trying to develop a new residency program, the report recommends two first steps:

• Conduct a feasibility study. Such a study would need to demonstrate the need for GME, the capacity of the region to sustain high-quality residency training programs and the financial commitment required.
• Create a business plan. This document would need to include details about the governance structure of a new program, the number of residents to be trained, a staffing plan and an economic impact statement.

Policy adopted along with the report includes a number of actions that could help advance funding for GME:

• The AMA will explore various models of all-payer funding for GME.
• Organizations with successful existing models should publicize and share their strategies, outcomes and costs.
• The AMA will encourage insurance payers and foundations to enter into partnerships with state and local agencies, academic medical centers and community hospitals to expand GME.

“The AMA is committed to expanding funding for GME to ensure that there are enough residency slots to train physicians in regions where health care services are needed most,” AMA Board Member Jesse M. Ehrenfeld, MD, said in a news release. “We will continue to urge all health care payers—from local, state and federal government and private sources—to work together to adequately fund GME programs, and will continue to advocate for ways to address physician shortages and increase patient access to health care.” 

The AMA has long advocated for and adopted numerous policies that support the modernization of GME, including increased funding for medical residency slots, development of innovative practice models and residency positions that reflect societal needs. 

Most recently, the AMA urged support of two federal bills. The Creating Access to Residency Education (CARE) Act would expand funding for GME and improve access to health care for patients in underserved areas. The recently introduced Resident Physician Shortage Reduction Act of 2015 would also help increase the number of residency slots and address physician shortages. 

Additionally, through its SaveGME campaign, the AMA continues to strongly urge Congress to protect federal funding.

The AMA’s Accelerating Change in Medical Education initiative also is addressing some of these issues through supporting medical school projects that accelerate student progress through medical school, allowing them to enter residency sooner and contribute more rapidly to expanding the physician workforce.