April 23, 1999

COGME Discusses GME Financing

At its meeting April 14 and 15, the Council on Graduate Medical Education (COGME) discussed its work plan for studying graduate medical education (GME) financing. In its work the council will emphasize the financing of education in ambulatory settings. The financing work group recommended the formation of an advisory panel for this effort that would include the perspectives of health care payers, health "futurists," directors of programs with ambulatory components, and health system executives with responsibility for financing the enterprise.

The council heard several presentations on GME financing. Craig Lisk, staff for the Medical Payment Advisory Commission (MedPAC), provided an update on the commission's deliberations. He presented much of the same material as at the COGME December 1998 meeting [see Washington Highlights, Jan. 8], but also added the new ideas raised at the March 18-19 MedPAC meeting by Commission Co-Chair Joseph Newhouse, Ph.D. Dr. Newhouse suggested a new conceptual framework for financing GME that would regard residents as bearing the costs of their education by accepting stipends that are less than the value of their services. According to this framework, the costs that were labeled "direct graduate medical education" when prospective payment was put into place in 1983 are mislabeled and are actually costs of patient care. Mr. Lisk reported that this way of thinking about GME was quite new to MedPAC commissioners and would be discussed more thoroughly at the Apirl 29-30 MedPAC meeting in Washington, D.C.

Tim Henderson of the National Conference of State Legislators presented the results of a survey of state Medicaid directors on GME financing by the Medicaid program. Based on responses from all 50 states, he estimated that states were spending from $2.3 to $2.4 billion on GME from Medicaid funds (including federal matching funds).

Karen Davenport, legislative assistant for Sen. Bob Kerry (D-Neb.), and Lawrence Clare, M.D., from Health Resources and Services Administration's Bureau of Health Professions, described Sen. Kerry's bill and the administration's proposal, respectively, to provide funding for GME at children's hospitals. Both proposals would use appropriated funds to support residents in those children's hospitals that do not share a provider identification number with another Medicare-eligible institution.

Information: Sunny Yoder, AAMC Division of Health Care Affairs, 202-828-0497.