Commission Reviewing GME Funding Disbands Without a
Proposal. JAMA. 1999;281(16):1556B. doi:10.1001/jama.281.16.1556
Prepared by Ashish Bajaj, Department of Resident and
Fellow Services, American Medical Association.
Currently, the Medicare program is the primary funding source for
graduate medical education (GME). Because many analysts expect the
Medicare Trust Fund to be bankrupt within the next 15
years, Medicare reform has recently been the subject of much political
discussion. Proposals for reforming Medicare are expected to include
substantial changes in GME funding mechanisms. To prepare residents and
others for the debate regarding these changes, the next several
Resident Physician Forum columns will explain some of the details of
GME funding, proposed changes, and the composition and perspectives of
those groups studying GME and presenting proposals.
In March of this year, the National Bipartisan Commission on the
Future of Medicare disbanded without being able to forward its
recommendations to Congress. The Commission, created by the Balanced
Budget Act of 1997, was charged with studying the Medicare program,
including funding for GME, and making recommendations that would
strengthen and ensure the solvency of Medicare for future recipients.
The Commission's 17 members were appointed by President Clinton and
Congressional leaders. Congress required that a supermajority (11 out
of 17 votes) on the Commission was needed for any proposal to be
forwarded to the House of Representatives; the final proposal received
10 votes. Although the proposal failed, the Commission's chairs, Sen
John Breaux (D, La) and Rep William Thomas (R, Calif) have stated that
they will rewrite the proposal as legislation and introduce it to
Congress. The chairs of the Senate Finance Committee and House Ways and
Means Committee said that they would hold hearings on the final
Medicare pays teaching hospitals for residency training through 2
payment streams. Direct medical education (DME) payments cover
resident, fellow, and faculty salaries and benefits as well as other
tangible educational expenses. The indirect medical education
adjustment (IMEA) compensates teaching hospitals for higher operating
costs associated with the presence of a residency program.
Although the Commission's proposal for GME funding was not
highly detailed, it did recommend that DME payments be carved out of
the Medicare Trust Fund. It recommended that DME either be funded
through a separate entitlement program or through multiyear
discretionary appropriations. The Commission's proposal supported
continued Medicare funding of the IMEA. However, the proposal also
acknowledged the difficulty of accurately calculating how much higher
the operating costs are at a teaching hospital.
Prior to his presentation of the final proposal, Senator Breaux had
released more details regarding GME funding. He recommended that DME
payments also be made to teaching institutions, such as children's
hospitals, that are currently ineligible for Medicare GME funding. In
addition, he recommended that the methods for calculating IMEA be
revisited to ensure appropriate funding.
As mentioned above, the Commission's chairs have stated that they
would introduce these proposals as legislative bills to Congress. We will continue to monitor and report on this issue as it develops.