DGME and Obamacare

One of the complaints when Obamacare was under discussion was that Obamacare would end up telling medical schools how many doctors to train.

This is not particularly new – in 1997, Congress passed funding within Medicare to train doctors during their residency after medical school.

Medicare makes DGME payments (Direct Grants for Medical Education) to teaching hospitals for its share of the cost of running the hospital – if 25% of the inpatient bed days were Medicare patients, then Medicare picks up 25% of the costs the hospital says they spend on the resident program.

However, coverage of this programs was capped at the number of residents a hospital had in 1996 – and human nature being what it is, the subsidy became effectively a limit on the number of new doctors. This government corporate welfare ends up defining the limit since schools wouldn’t add new students and dilute their subsidy. Keep in mind the hospital is billing for the work the residents do. Residents provide cheap labor and work unreasonable hours for little money.

We didn’t become socialists overnight