Published: March 16, 2018

Why funding for graduate medical education should change

Contact(s): Geri Kelley College of Human Medicine office: (616) 233-1678 cell: (616) 350-7976, Sarina Gleason Media Communications office: (517) 884-3755

The way the federal government pays hospitals to train resident physicians hasn’t changed in decades.

Now, a Michigan State University physician thinks it’s time to come up with new standards for reimbursing hospitals for their graduate medical education programs.

“It’s a pretty outdated system,” said Heather Laird-Fick, an associate professor of medicine in the College of Human Medicine and co-author of an article published in the journal Academic Medicine.

The federal government began funding graduate medical education in 1965 as part of the law that created Medicare. In 1995, the government asked each hospital to calculate how much it cost them to train resident physicians, an arbitrary amount that varied from hospital to hospital and hasn’t changed since.

“None of it has to do with the quality of medical education,” Laird-Fick said.

She and her co-authors, all educators at medical schools across the country, proposed 17 performance-based metrics to determine how the government pays hospitals for their residency programs. After graduating from medical school, each doctor is required to complete a residency program, also known as graduate medical education, which can vary from three to seven years, depending on specialty.

“The idea is there should be greater accountability for how the taxpayers’ money, which is currently more than $15 billion a year, including $9.7 billion from Medicare, is allocated,” Laird-Fick said.

Among their recommendations, the authors suggested including the value of care each hospital provides, access to care, patient safety, hospital readmission rates and efforts to reduce health disparities.

Laird-Fick said the article is not intended to be the final word on the subject, but rather something that will start a national conversation on how to establish a more-equitable and transparent method of funding graduate medical education.

“The idea is we want to move toward something that is sustainable in graduate medical education and that allows for innovation and improved outcomes,” she said.

A formula based on outcomes should produce physicians who are better trained, result in improved care for patients and reduce waste, she added.

Talk of changing the formula for graduate medical education funding has been ongoing for years. In 2012, the Institute of Medicine, now the National Academy of Medicine, proposed changing to a performance-based system to meet current and future needs for physicians, but stopped short of recommending specific ways of measuring it.

The issue has periodically come up in Congress, as well.

“It’s been such a big and thorny issue and rather than having something imposed externally, it makes sense for it to come from people who understand how graduate medical education is done,” Laird-Fick said.

“One thing that’s certain is the current state of affairs is not sustainable over the long term. Change is coming.”