Hospitals at odds over CMS plans for new GME slots

Modern Healthcare

June 30, 2021 7:54 pm

Hospitals are at odds over how CMS should distribute an additional 1,000 graduate medical education slots, according to comments on the agency’s proposed inpatient prospective payment system rule.

After 25 years of inaction, Congress finally increased the number of Medicare-supported GME slots to address the nation’s growing doctor shortage in its December spending bill. The Association of American Medical Colleges estimates the U.S. will need 37,800 to 124,000 more physicians by 2034 to keep up with demand, so the additional capacity is necessary given how long it takes to train doctors.

Under the law, CMS is supposed to distribute 200 GME slots each year for five years, starting in 2023. It also requires the agency to distribute at least 10% of the slots across four categories: rural hospitals; hospitals training over their Medicare cap; hospitals in a state with a new medical school or branch campus; and hospitals in health professional shortage areas.

CMS came up with two options for distributing those additional slots, pitting rural hospitals against the rest of providers. Under the first option, CMS would hand out GME slots based on a hospital’s health professional shortage area score for all five years of the allocation period. Under the second option, the agency would prioritize GME slots based on how many of the congressionally approved categories hospitals meet.

“Hospitals that qualify under all four categories would receive top priority, hospitals that qualify under any three of the four categories would receive the next highest priority, then any two of the four categories, and finally hospitals that qualify under only one category,” the proposed rule said.

But the second option would only apply in 2023.

“That would allow additional time to work with stakeholders to develop a more refined approach for future years,” the proposed rule said.

Likewise, both options would award a maximum of one full-time equivalent residency slot per hospital each year, even though Congress said CMS could allocate up to 25 FTEs per hospital per year. The agency decided to lower the cap in anticipation of high, pent-up demand for additional GME slots. 

Rural providers strongly supported the first option, arguing that allocating GME slots based on a hospital’s health professional shortage area score would improve health equity and access to care for people in rural areas.

“This proposal will help to address the maldistribution of physicians over time,” the National Rural Health Association wrote in a comment letter. “Prioritizing geographic and population HPSAs and using HPSA scores would ensure residency slots are awarded to those programs serving high proportions of underserved patients.”

But the American Hospital Association and a coalition led by the AAMC disagreed, hinting they could sue CMS if it goes with the first option.

“CMS’ proposal to prioritize slot distribution by health professional shortage area (HPSA) scores reflects neither statutory intent nor the reality of teaching hospital service areas,” the AHA wrote in a comment letter.

Both the AHA and the AAMC-led coalition supported CMS’ proposed alternative to allocate GME slots based solely on the four categories described in December’s spending bill. But the AAMC noted in a separate letter that it only supported the measure as a stopgap solution.

“Finalizing a methodology for only one year will also provide an opportunity to evaluate how the process operates and provide real-time information about how the methodology works,” the AAMC wrote.

But states without new medical schools or branch campuses might not get any more GME slots if CMS goes with the second option, according to the NRHA.

“Since graduates of new medical schools are 40% less likely to become primary care physicians, we are concerned that CMS could inadvertently reduce the primary care pipeline and worsen physician shortages in rural and underserved areas by favoring states with new medical schools,” the NRHA wrote.

CMS’ proposed cap of one FTE residency slot per hospital also drew the ire of major provider groups who said it was unworkable because each additional resident would take up space for three to five years. They urged CMS to increase the number of GME slots available per hospital.

“This would mean that a hospital would need to apply and obtain a slot every year for three consecutive years in order to fully sustain a stable internal medicine residency program and for four or five consecutive years for other specialties. While obtaining a slot every year is possible, it certainly is not guaranteed. And, such a limitation would make recruitment difficult and would not advance toward building sustainable training programs,” the AHA wrote.

Hospitals also signaled that they want Congress to increase the number of Medicare-funded GME slots further to help meet the growing demand for physicians and avoid a Hunger Games-like competition for more residents.