Currently the Centers for Medicare and Medicaid Services regulations do not allow payment for physician training outside of the teaching hospital. In CMS language, hospitals are called “providers” and training outside of teaching hospitals is referred to as training in “non-provider sites.” Thus, while the majority of patient care in the real world occurs outside of hospitals, Medicare only pays for resident training that is provided inside of teaching hospitals.
Consequently, there is a training imbalance that prevents adequate preparation of a workforce for the place where most health care takes place—in outpatient settings. The current funding formulas also encourage subspecialization and practice after graduation in close proximity to adequately served urban areas—because that’s where most teaching hospitals are located. Data collected by the Dartmouth Atlas Project show that increasing the number of specialists in these urban areas increases costs, without improvement—and sometimes results in a decrease—in the quality of care.
Both bills in Congress amend Medicare Graduate Medical Education payments to allow time spent by residents in community settings to be reimbursed. In addition, the House bill also requires HHS’s Office of the Inspector General to conduct a study to assess the effect of the increased time spent by medical residents in community settings and to present the findings to Congress within four years.
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