September 17, 1999
COGME Focuses on Medicare GME
At the Sept. 7-8 Council on Graduate Medical Education meeting in Washington, AAMC Senior Vice President Robert Dickler reminded COGME members of the difficulty in differentiating graduate medical education (GME) from other academic medical center missions, including:
- clinical education of medical students,
- continuing medical education,
- research and the research infrastructure,
- special medical services, and
- care of the uninsured and underinsured.
Mr. Dickler voiced concern that proposals to eliminate Medicare GME support would put all these missions at risk, especially given the reduced revenues to teaching institutions due to the Balanced Budget Act of 1997. Through direct medical education payments, the indirect medical education adjustment, and disproportionate share payments, Medicare has explicitly supported these functions while other payers have not. With many health care participants taking the stance that these are important missions but "not my responsibility," Mr. Dickler asked whose responsibility would they be if Medicare withdraws?
Mr. Dickler's comments were made in response to presentations by Medicare payment Advisory Commission Chair Gail Wilensky, Ph.D., and staff from the Senate Health, Education, Labor and Pensions Subcommittee on Public Health, the Senate Finance Committee, and House Commerce Committee. Dr. Wilensky summarized the MedPAC position that Medicare appropriately should pay for medical services to beneficiaries in institutions "dedicated to teaching," but that federal support of other missions including GME should be made through appropriated funds. She acknowledged that this position is provocative and suggested that action on this front is unlikely to occur in the current Congressional session.
Kathy Means of the Senate Finance majority staff reviewed the origins of Medicare financing based on the industry standard Blue Cross/Blue Shield provider contracts of the 1960s. Under these contracts, on which Medicare was modeled, provider payments were based on "reasonable and necessary" costs with no limits. Program costs rose rapidly and as early as 1972 steps were taken to impose limits. As Medicare moved to make more fundamental changes in its payment policies in the early l980s by instituting "medically appropriate" payments for inpatient services for specific diagnoses, it faced the question "What about teaching hospitals?" Out of this debate the direct and indirect GME payments emerged.
Both the economic and political environments have undergone a sea change since that time, according to Ms. Means, with intense market competition among hospitals and increasing questioning by the Medicare Bipartisan Commission and the Clinton Administration of what Medicare should pay for. These economic and political forces are driving toward a substantial revamping of GME funding, in her view, although probably not in this session.
Senate Finance minority staff member David Podoff reviewed the all-payer funding proposal contained in the bill introduced by Senator Daniel Patrick Moynihan (D-N.Y.). Dr. Podoff took issue with the concern for the appropriate funding formula, asserting that the fundamental issues are whether the pool of funds is large enough and who should contribute to the pool. In his view the issue of what formula should be used for distributing the funds should only be addressed after the first two are resolved. Frank Simon, M.D., from the American Medical Association reported that the AMA's Committee on Medical Education supports stable, all-payer funding for direct GME and a national advisory council on GME/health workforce to guide the use of these funds. The AMA position is that federal funding should be limited to 120 percent of U.S. medical graduates. Edward Brandt, M.D., Ph.D., of the Commonwealth Fund Task Force on the Future of Academic Health Centers, emphasized the task force position that the social missions of academic health centers should be publicly funded. This funding should not exacerbate workforce problems nor interfere with the provision of health services in the most optimal settings.
COGME will publish its 15th report on the topic of GME funding, with particular attention to GME in outpatient settings, in the fall of 2000.
Information: Sunny Yoder, AAMC Division of Health Care Affairs, 202-828-0497.
