Medicare’s Role in Addressing
the Nation’s Physician Shortage
Karen Fisher, JDAAMC Chief Public Policy Officer
Janis M. Orlowski, MD, MACPAAMC Chief Health Care Officer
Christopher T. Westfall, MD, FACSExecutive Vice Chancellor and Dean, College of Medicine
University of Arkansas for Medical Sciences
Leonard MarquezAAMC Senior Director, Government Relations
On Behalf of the Congressional Academic Medicine Caucus,
the AAMC Presents a May 6, 2019, Capitol Hill Briefing on:
Patient Care Education Research
Three Missions Define Academic Medicine
Only 5% of All Short-term, Non-Federal,
General Hospitals Are AAMC Members But
They Account for:
24% all inpatient days
22% Medicare days
26% Medicaid days
32% charity care costs
98% comprehensive
cancer centers
63% pediatric ICU beds
68% level-1 trauma centers
Medical Schools &
Teaching
Hospitals
50+%of NIH
external grant $
75% of all residents
Sources: AAMC analysis of AHA Annual Survey Database FY 2017 and NIH Extramural Research Award data.
Sources: AAMC analysis of FY 2017 AHA data, American colleges of Surgeons Level 1 trauma center designations, and National Canter Institute’s Office of Cancer Centers, 2018
Academic Medicine
Fills Major Roles in Health Care
“Graduate Medical Education”
Post medical school training in a medical
school or teaching hospital-sponsored
residency program
What Is “GME?”
• Teaching hospitals incur costs other hospitals don’t:
residents’ stipends & benefits, faculty time, administration &
overhead
• Since 1965, Medicare has helped offset these costs
• Today Medicare is the single, largest payor of GME
The Cost of GME
“DGME:” Direct GME Payment Policy
• Medicare reimburses teaching hospitals for “Medicare’s
share” of teaching hospitals’ costs of training residents
• Medicare’s share of the cost is based on a teaching
hospital’s Medicare inpatient volume - about 30% to 40%
Medicare DGME Payments
• BBA of 1997 Capped the # of Residents a Teaching Hospital
Can Count for Medicare GME Payments at FY 1996 Level
• Teaching Hospitals Now Train about 15,000+ Residents over
their Hospital-Specific Caps
Limits on Medicare
GME Payments
Teaching Hospital DGME CostsFY 2016
$14.71* Billion in
DGME Costs Not
Paid for by
Medicare
Total DGME
Costs for Al
Teaching
Hospitals in
FY 2016 =
$18.5 Billion
$3.79 Billion in Medicare
DGME Payments
Medicare Paid
Only 20% of
Total GME
Costs of All
Teaching
Hospitals in
FY 2016
Medicare DGME PaymentsCover 20% of Total DGME Costs
Janis M. Orlowski, MD, MACP
AAMC Chief Health Care Officer
Washington, DC
Workforce AnalysisProjected Physician Shortage
© 2015 AAMC. May not be reproduced without permission.© 2019 AAMC. May not be reproduced without permission.
© 2015 AAMC. May not be reproduced without permission.© 2019 AAMC. May not be reproduced without permission.
Primary Care
Shortfall
21,100 – 55,200
Specialty Care
Shortfall
24,800 – 65,800
Physician Workforce Shortage ProjectionsBy 2032, Physician Shortfall of 46,900 – 121,900
* Projections don’t add up because of microsimulation model used
Source: I.H.S. Markit Inc., The Complexities of Physician Supply and Demand 2019 Update: Projections from 2017 to 2032. Prepared for the Association of American Medical Colleges. Washington, DC: Association of American Medical Colleges.
In the next decade, 2 in 5
physicians will be over 65 and
could retire.
© 2015 AAMC. May not be reproduced without permission.© 2019 AAMC. May not be reproduced without permission.
Total Projected Physician Shortfall Range, 2017-2032
Source: I.H.S. Markit Inc., The Complexities of Physician Supply and Demand 2019 Update: Projections from 2017 to 2032. Prepared for the Association of American Medical Colleges. Washington, DC: Association of American Medical Colleges.
© 2015 AAMC. May not be reproduced without permission.© 2019 AAMC. May not be reproduced without permission.
Size and Range of Projected Shortages Varies by Specialty
Source: I.H.S. Markit Inc., The Complexities of Physician Supply and Demand 2019 Update: Projections from 2017 to 2032. Prepared for the Association of American Medical Colleges. Washington, DC: Association of American Medical Colleges.
© 2015 AAMC. May not be reproduced without permission.© 2019 AAMC. May not be reproduced without permission.
Estimated additional physicians needed if U.S. had achieved Health Care Utilization Equity in 2017
Scenario 2:
Insurance, Metro/Non-
metro, & Race/Ethnicity
95,900Additional Physicians
Scenario 1:
Insurance & Metro/
Non-metro
30,800Additional Physicians
Source: I.H.S. Markit Inc., The Complexities of Physician Supply and Demand 2019 Update: Projections from 2017 to 2032. Prepared for the Association of American Medical Colleges. Washington, DC: Association of American Medical Colleges.
© 2015 AAMC. May not be reproduced without permission.© 2019 AAMC. May not be reproduced without permission.
U.S. MD enrollment expected to exceed 30% increase
15,000
16,000
17,000
18,000
19,000
20,000
21,000
22,000
23,000
2002 2005 2008 2011 2014 2017 2020 2023
US
MD
FIR
ST
YE
AR
EN
RO
LLM
EN
T
Original
schools
(n=125)
All Schools (n=145)
30% over 2002
Historical Data Survey Data Projections
Source: AAMC 2016 Medical School Enrollment Survey Report
© 2015 AAMC. May not be reproduced without permission.© 2019 AAMC. May not be reproduced without permission.
Drivers of the Projected Physician Shortage
Growing Population
Changes in Healthcare
Physician Retirement
Aging Population
10,000
12,500
15,000
17,500
20,000
23,000
28,000
33,000
38,000
43,000
48,000
53,000
58,000
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
PH
YS
ICIA
NS
TU
RN
ING
65
RE
SID
EN
TS
/PO
P. 6
5+
IN
TH
OU
SA
ND
S
Residents entering ACGME Pop 65+ Physicians turning 65
Production of new physicians are not keeping up with aging workforce and populationSource: ACGME, Census, AMA Physician Masterfile; US Census Bureau
© 2015 AAMC. May not be reproduced without permission.© 2019 AAMC. May not be reproduced without permission.
Strategies to Meet the Need
• Physician education in team-based, interprofessional care; development of innovative
care delivery and payment models; integration of cutting-edge technology and
research into patient care environments
• Address the freeze by adding 3,000 new residency positions each year for the next 5
years
• Federal incentives and programs designed to recruit a diverse workforce and
encourage physicians to enter shortages specialties and practice in underserved
communities
Medicare GME Policy
Christopher T. Westfall, MD, FACS
Executive Vice Chancellor & Dean, College of
Medicine, University of Arkansas for Medical
Sciences, Little Rock, AR
The Arkansas Perspective
Insert Dr. Westfall’s slides
Leonard Marquez
AAMC Senior Director, Government Relations
Washington, DC
Medicare GME Cap Bills
“Resident Physician Shortage Reduction Act of 2019”
• Bill Purpose: Increase # of Medicare-supported residency slots
nationally by 3,000 per year from 2021 to 2025 (total increase = 15,000
slots)
• S. 348: Sens. Menendez (D-NJ), Boozman (R-AR), Schumer (D-NY)
• H.R. 1763: Reps. Sewell (D-AL) and Katko (R-NY)
Medicare GME Cap Bills
Both S. 348 and H.R. 1763:
• Half of new slots each year must be used for residents in new shortage
specialty training program
• Examples of criteria for selecting hospitals to receive new slots:
• Provide rural training
• Provide community training
• Train residents over the hospital’s cap
Resident Physician Shortage
Reduction Act of 2019
“Opioid Workforce Act of 2019”
• Bill Purpose: Increase # of residency slots available to qualifying
hospitals by 1,000 nationwide from 2021 - 2025
• HR 2439: Introduced by Reps. Schneider (D-IL), Susan Brooks (R-IN),
Kuster (D-NH), Stefanik (R-NY)
• Senate: Bipartisan bill to be introduced soon
Medicare GME Cap Bills
HR 2439:
• Eligible hospitals must have or demonstrate they will have a training
program in addiction medicine, addiction psychiatry, and/or pain mg’t.,
as well as the necessary prerequisite program (e.g., internal medicine)
• No hospital may receive more than 25 slots
Opioid Workforce Act of 2019
• Office of Sen. Menendez: Swarna Vallurupalli ([email protected])
• Office of Sen. Boozman: Ryan Losak
• Office of Sen. Schumer: Matt Fuentes([email protected])
• AAMC: Len Marquez, [email protected]
Ally Perleoni, [email protected]
For More Information
Senate Offices and AAMC
• Office of Rep. Sewell: Hillary Beard
• Office of Rep. Katko: Jennifer Wood
• Office of Rep. Schneider: Vic Goetz
• Office of Rep. Brooks: Erin McMenamin
For More InformationHouse Offices
Medicare GME Policy
Questions?
© 2017 AAMC. May not be reproduced without permission.© 2018 AAMC. May not be reproduced without permission.