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Comment & Response
Health Care Policy and Law
March 2020

Considerations in Analysis of Medicare Graduate Medical Education Payment Policies—Reply

Author Affiliations
  • 1Milken Institute School of Public Health, The George Washington University, Washington, DC
  • 2The Robert Graham Center, Washington, DC
  • 3American Board of Family Medicine, Washington, DC
JAMA Intern Med. 2020;180(3):472-473. doi:10.1001/jamainternmed.2019.6977

In Reply In response to our study,1 Xu and Orlowski suggest that Medicare indirect graduate medical education (GME) payments, effectively 75% of total Medicare GME payments, should be disregarded when considering Medicare’s support for training. While the indirect payment may recognize the higher cost of patient care associated with teaching, it is clearly a payment for GME and should be considered in any policy discussion of this public investment in physician training. Furthermore, a 2010 analysis by the Medicare Payment Advisory Commission (MedPAC)2 found that less than half—only 40% to 45%—of the indirect payments could be empirically justified by higher patient care costs. In 2010, MedPAC recommended redistributing the estimated $3.5 billion in GME overpayments to a new performance-based GME program.2 Our study1 shows that indirect payments have further increased since 2010.

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