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GAO Issues Report on Medicare GME Caps, Funding

June 25, 2021

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Brad Cunningham, Sr. Regulatory Analyst, Graduate Medical Education

The Government Accountability Office (GAO) published a report, Physician Workforce: Caps on Medicare-Funded Graduate Medical Education at Teaching Hospitals, on May 21. The report reviewed Medicare funding for graduate medical education (GME).

In the report, the GAO discussed the extent to which hospitals are over their cap, the extent to which hospitals participate in GME affiliation agreements, and stakeholder views on extending the five-year cap building window. New teaching hospitals, or hospitals that have not previously trained residents, are able to establish a Medicare cap during a five-year window. Among the report’s findings were that as many as 70% of teaching hospitals are over their GME caps and that Medicare does not fund at least 20% of residents currently completing training. Additionally, more than a third of hospitals participate in affiliation agreements to temporarily reallocate residency positions. 

 The stakeholders interviewed for the report identified that extending the five-year cap building window would increase the total number of Medicare-funded GME positions at teaching hospitals. For smaller and under-resourced teaching hospitals, extending the five-year window would allow time to develop appropriate patient populations and recruit residents to training programs. In particular, stakeholders felt that having a longer cap-building window would allow teaching hospitals more time to establish and grow residency programs before the cap takes effect. 

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