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New Institute of Medicine Report Calls for Medicare Graduate Medical Education Overhaul

July 29, 2014 —Today, the Institute of Medicine released a new report, Graduate Medical Education That Meets the Nation’s Health Needs, that calls for changes to GME financing and governance to address deficiencies and shape the phy­sician workforce for the future. The report was created by an expert committee that conducted an independent review of the governance and financing of the GME system. The 21-member IOM committee concludes that there is an unquestionable need to assess and optimize the effectiveness of the public’s investment in GME.

The report notes that:

  • The current Medicare GME system has little accountability, allocates funds independent of workforce needs or educational outcomes, and provides insufficient opportunities to train physicians in health care settings used by most Americans. Funding formulas in place now discourage training at clinics or community-based settings where most people now seek care. 
  • Medicare provides $9.7 billion per year in graduate medical education funding.
  • A lack of research makes ascertaining the costs, effectiveness, or outcomes of training programs impossible.
  • Between 2003 and 2013, there was a disproportionate increase in the number of physicians being trained as specialists despite a greater demand for generalists.
  • Residency training has grown by 17% between 2002 and 2012 without additional government funding.
  • Training is concentrated in specific geographic regions and urban areas, and the training system is not increasing the number of physicians willing to locate to rural areas or treat underserved populations.

Additionally, we are pleased to see the IOM committee strongly assert its finding that "an increase in training slots will do little to ensure a proper balance of specialties or adequate staffing of changing care settings—particularly in different geographic regions,” stated Tricia Elliott, MD, chair of the Academic Family Medicine Advocacy Committee. Dr Elliott stresses that any additional positions must be tailored to population health needs.

“The report proposes significant revisions to rectify current shortcomings and create a GME system with greater transparency, accountability, strategic direction, and capacity to innovate. “I hope it will provide useful and principled guidance for policy makers and program administrators alike as we work toward a GME system that better contributes to achieving the nation’s health goals,” said Harvey Fineberg, MD, PhD, president, Institute of Medicine (July 2002–June 2014)

In the report, the committee recommends a 10-year transition period for implementation of its recommendations, followed by a reassessment.
Specifically, the IOM committee recommends:

  • Maintaining Medicare funding at its current level and making it contingent on its demonstrated value and contribution to the nation’s health needs.
  • Modernization of payment methods to reward performance, ensure accountability, and incentivize innovation in the content and financing of GME.
  • Building an infrastructure to facilitate strategic investment by establishing a two-part governance infrastructure for federal GME financing. A GME Policy Council, housed in the Office of the Secretary of Health and Human Services, to oversee policy and decision making, and an office within the Centers for Medicare & Medicaid Services to administer payment reforms and manage demonstrations of new payment models.
  • Replacing the payment methodology with a single national, per-resident amount.
  • Distributing funds directly to the organizations that sponsor physician training programs—including hospitals, clinics, and universities, to encourage training in a variety of sites.

"It is satisfying to see a prestigious body such as IOM recommend changes to the GME system that are in line with reform principles family medicine has been espousing since 2009. This includes the need for Medicare GME funding to change in several ways: to be disconnected from inpatient care and Medicare-share formulas, to increase training in the community, and to go to additional entities, beyond just hospitals," said Dr Elliott.

The IOM committee says the IOM report, Graduate Medical Education That Meets the Nation’s Health Needs, provides an initial roadmap for reforming the Medicare GME payment system and investing in the nation’s physician workforce and that continued Medicare support of GME should be contingent on its demonstrated value and contribution to the nation’s health needs.

For a quick summary, view the IOM GME Presentation (PDF) or visit the IOM website for more information.

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