MERC Committee Meeting
Wednesday, July 10, 2013
10 am – 12 pm
American Lung Association Building
490 Concordia Avenue in St. Paul
Agenda
10:00
Welcome/Introductions
Minutes/Old Business
10:15
Presentation and Discussion of Federal GME in Minnesota
 John Andrews, MD University of Minnesota
 Ron Grousky, Mayo Clinic
11:15
MERC Program Updates and discussion
Future meeting agenda topics:
Pharmacist education issues
Dental education issues
APRN education issues
Other?
MERC Committee Meeting
April 17, 2013
Committee Members Present:
Leon Assael, Michael Belzer, Terry Crowson, Jim Davis*, Kate Dean, Dawn Ludwig, Kathy Meyerle,
Merri Moody, and John Rodewald.
Alternate Present:
Tom Larson for Marilyn Speedie
Deb Mayland-Poyzer for Mary Edwards
Interested Parties Present:
Gina Danyluk*, David Knowlan, Peg Lamin, Mike Mahoney*, Margo Marko, Janet McCarthy, Jeff
Richter, Rick Roberts, Al Rose, Colette Salmanowicz, Helen Schatzlein, Trisha Schirmers, Troy
Taubenheim, Amy Tepp, and Joel Tomlinson.
MDH Staff Present:
Diane Reger and Mark Schoenbaum – MERC Staff
Nitika Moibi – Guest Presenter
*Indicates Attendance via Conference Call
I.
Introductory Remarks – Kathleen Meyerle, Vice Chair
Ms. Meyerle opened the meeting. She introduced herself and shared that Marilyn Speedie, Committee
Chair, is out of the country on business and arranged for Tom Larson to attend as alternate. She thanked
those recently joining the committee and briefed the committee on the agenda and asked those in
attendance for introductions.
II.
Committee – Mark Schoenbaum, MDH
Since the last meeting, committee membership has changed. Past members were asked if they would
like to continue to serve. Those that declined or did not respond were removed and their membership
filled with representatives of categories of MERC grantees by professional discipline, facility type, size
and geography. The new membership was based on individuals, not organizations.
Mr. Schoenbaum went over the Operating Guidelines and asked if the members had questions. One
member asked what constitutes an excused versus an unexcused absence. Mr. Schoenbaum directed the
question to the committee for their thoughts. Ms. Meyerle noted that she believed that an excused
absence is one that is communicated to MERC staff; that the goal is members themselves attend. If the
committee is to make impact, attendance is important. If, on occasion, members need to send an
alternate in their place, they must contact staff prior to the meeting to make staff aware they cannot
attend and notify staff if they are sending an alternate in their place. This will ensure the alternate has
voting rights of the member.
III. Presentations: Health Professions Education in MN – Troy Taubenheim, MMCGME
http://www.health.state.mn.us/divs/hpsc/hep/merc/committee/pres041713.pdf
Note: GME funding sources do not include Rochester or St. Cloud.
Understanding Minnesota’s Primary Care Workforce - Nitika Moibi, MDH
http://www.health.state.mn.us/divs/hpsc/hep/merc/committee/wkfrcpres.pdf
The question was asked: What’s more important, more FTEs to prepare for those exiting the workforce
or more money to gain more training sites?
It was recommended more education be directed at the legislature so facilities can gain more revenue
sources to cover training. Programs have been operating under the assumption that MERC funding
would one-day be restored; they have not made cuts to their training programs yet because of this
assumption. If money is not eventually restored, facilities will need to decrease training spots.
It was noted that programs are finding it hard to budget because there’s a lack of consistency with the
amount of funding some sites are requesting to take on trainees. Another program voiced that they seek
to avoid paying clinical sites for their students’ clinical rotations.
Dr. Assael noted that although a significant number of medical students start off wanting to be in family
medicine, many choose other specialties as they respond to the payment system’s lower value on
primary care instead of the satisfactions of family medicine. An interested party commented that
Medicare is the main GME funder, and Congress has not raised the Medicare FTE cap to fund
additional resident slots.
Suggestions for future committee discussions or involvement:
◦ Workforce projections and related training resources needed.
◦ Federal role in health professions education and possible advocacy for increased Medicare GME
funding.
◦ Unique training and financial issues of medicine (presented 4/17), pharmacy, dentistry, etc.
◦ Input to the legislature and advice to MDH and others.
◦ Accountability for MERC funds to document results and build support.
IV. Program Updates – Mark Schoenbaum and Diane Reger, MDH
Legislative: The current proposal by the Senate (SF1034) includes restoring $6.4 M to PMAP funding,
raising the minimum site grant payment to $5,000, imposing a 0.1 FTE site minimum, and a formula
change. The formula would eliminate the 20% supplemental grant to sites over .98% relative Medicaid
revenue, a grant limit per FTEs would be placed on sites which would limit funding to no more than the
95th percentile per FTE. The impact of the 95th percentile would be felt by sites that have high
Medicaid volume and few FTEs. The proposal also carves-out $1M for primary care development
grants. The House proposal restores $12.8 million to PMAP funding with the current formula, and
creates a separate $1 million rural residency grant program.
Technical workgroup: The revenue workgroup that was convened at the advice of the MERC
committee meet several times over winter/spring. They worked closely with DHS and MDH to improve
the methodology that is used to gather Medicaid revenue used in calculating the MERC grant. DHS
was unable to attend the meeting, but a handout was provided summarizing the methodology that is
being used as a result of the work from the revenue workgroup. A few providers in attendance
mentioned that they would like to see the dialog continue with DHS to improve the data that is sent to
DHS from the MCOs. Staff will communicate this to DHS.
Grant Distribution: The State Plan Amendment (SPA) discussed at the last MERC meeting was
approved by CMS, and MERC was approved for a full federal match on tobacco funds once the UPL
was determined. Grants to sites submitted on the 2012 MERC grant application have been calculated.
Handouts showing distribution by sponsoring institution and training site were provided. They are also
available on the MERC website. The total grant is $31.2 M. There were 3,238 eligible FTEs
submitted. The sponsoring institutions remained the same as last year’s distribution. Once funds are
available, Ms. Reger will be sending materials to the sponsoring institutions showing the payments to
their training facilities. Sponsoring institutions will have 60-days to distribute funds to their clinical
training sites. Grant verification reports and financial reports showing the payments were made are due
to MDH at the end of the 60-days. MDH is required to share this information with DHS and ultimately
CMS.
The grant agreements that were sent to sponsoring institutions included additional wording about
providing ‘other information as deemed appropriate by MDH as evidence that funds were disbursed
according to the Grant Verification Report and used in compliance with MERC requirements.’ Mr.
Schoenbaum apologized about the late appearance of this new language to those that were concerned
with the additional wording. There were few comments that the concern surrounded the sponsoring
institutions ability to know how funding was used after arriving at the training facility. Mr.
Schoenbaum explained that the wording was related to the sponsoring institution and not the training
site. However, he would like to implement an annual reporting mechanism requiring the sites to show
how funds are used to supporting medical education. The period of performance for the funding was
questioned. Ms. Meyerle said that she believe the original intent of MERC funds was a supplemental
funding source for sites that put time into training that weren’t getting reimbursed. Mr. Schoenbaum
noted that the funds are treated as grants by MDH. Mr. Schoenbaum provided a report sample that is
used by another program to collect feedback on funding. He would like to develop something similar
that could prove useful to MERC. There was additional discussion regarding the manageability of this
and who would bear that responsibility. MDH would collect this from the sites, most likely through a
web-based form, noting that source documents wouldn’t necessarily be required upfront, but could be
requested at a later date or in case of audit. The committee was asked to look at Mr. Schoenbaum’s
example and provide feedback via email.
MERC Survey: A few comments were shared at the easy of submitting the MERC survey that was sent
out last fall. Members asked if this would continue or if site reporting would replace this. That
discussion was tabled for future discussion.
V.
Meeting Schedule
We will be meeting approximately every three months. Committee members will be contacted to
schedule the next MERC meeting. It was requested that the meetings be held on a different day than
Friday. If the meetings are scheduled in the morning, we will attempt to schedule them at 10 a.m. to
allow travel time for those outside the Metro area. The meeting date will be communicated to interested
parties once scheduled. Please refer to the advisory committee section of the MERC website for
updates as well.
Commissioner’s Office
625 Robert St. N.
P.O. Box 64975
St. Paul, MN 55164-0975
(651) 201-4989
www.health.state.mn.us
Medical Education &
Research Cost (MERC)
2013 Grant Distribution
Report to the Minnesota Legislature
Minnesota Department of Health
June 2013
Medical Education & Research Cost (MERC)
2013 Grant Distribution
June 2013
For more information, contact:
Office of Rural Health and Primary Care
Minnesota Department of Health
121 East 7th Place, Ste. 220
P.O. Box 64882
St. Paul, MN, 55164-0082
Phone: (651) 201-3566
Fax: (651) 201-3830
As requested by Minnesota Statute 3.197: This report cost approximately $1,000 to prepare, including staff time,
printing and mailing expenses.
Upon request, this material will be made available in an alternative format such as large print, Braille or cassette tape. Printed on
recycled paper.
Background
The Medical Education and Research Costs (MERC) program, which distributes grants to clinical training
sites around the state, was created by the Minnesota Legislature in 1997. Since its inception, the MERC
program has distributed grant funds to hospitals, clinics and other clinical training sites throughout
Minnesota. Funding has come from a variety of sources since its inception, including the General Fund, the
one-time tobacco endowment, a dedicated cigarette tax and the Medicaid program.
The distribution formula that governs the MERC program has also changed over the years. The original
MERC distribution formula focused solely on the costs borne by clinical training sites for providing
training and the number of full-time equivalent (FTE) students/residents at each training site. Each
applicant facility submitted information about clinical training costs, and the available funds were
distributed among eligible sites so that each site was reimbursed for a set percentage of their costs, usually
6 to 9 percent.
In 2000, Minnesota was given authority by the Centers for Medicare and Medicaid Services to “carve-out”
a portion of the Prepaid Medical Assistance Program (PMAP) capitation payments made by the
Department of Human Services to each health plan. This “medical education increment” was directed to
the MERC program and distributed under a separate formula.
Debate around the MERC distribution formula has generally centered on whether the program is designed
to support clinical training wherever it occurs, and thus should be driven by a cost-based formula that
allows grant funds to “follow” trainees to their sites of training, or whether the high proportion of Medicaid
funding that comprises the MERC fund means that the funds should be directed primarily to those sites that
have a larger share of Medicaid business. When the PMAP carve-out was authorized in 2000, the
Minnesota Legislature directed the Minnesota Department of Health to convene a committee to evaluate
the distribution formula.
In recognition of the importance of both of those factors, that group recommended a dual weighting system
that considered each facility’s share of the Medicaid pool as well as their clinical training costs. Both the
relative Medicaid revenue at each facility and the relative training costs at each facility were given equal
weight in the PMAP distribution formula.
The MERC statute was revised in 2003 to combine the MERC and PMAP distributions into a single annual
distribution beginning with the 2004 distribution. Mirroring their weight prior to the combination of the
two distributions, clinical training costs and relative Medicaid costs were given 67 percent and 33 percent
of the weight of the distribution, respectively.
During the 2007 legislative session, the MERC statute was again modified. The distribution formula was
revised to take into account only relative Medicaid volume rather than a combination of Medicaid volume
and clinical training costs. The new formula was implemented with the 2008 MERC application and
included a supplemental grant to eligible clinical training sites whose Medicaid revenue accounted for
more than 0.98 percent of the total overall Medicaid revenue for eligible sites. These sites would receive a
supplemental grant equal to 20 percent of their original grant, with those funds coming from sites whose
Medicaid revenue accounted for less than 0.98 percent of the total pool. Nursing homes became ineligible.
Several direct payments to large providers were added to the distribution formula, with these direct
payments taken out of the overall pool of available MERC funding prior to the application of the
distribution formula.
Revisions during the 2011 legislative session included a reduction in funding, resulting in a 50 percent
decrease in the available funds. The statutory change also eliminated the direct payments to the University
of Minnesota Academic Health Center, the University of Minnesota Medical Center - Fairview, and the
University of Minnesota School of Dentistry, and instituted a $1,000 minimum training facility grant.
Additional background information and details on past distributions can be found at
http://www.health.state.mn.us/divs/hpsc/hep/merc/publications/index.html.
2012 Legislative Changes
There were no changes to the general distribution during the 2012 legislative session; however, a provision
was enacted granting a one-time payment to Gillette Children’s Healthcare in the amount of $300,000 prior
to calculating the distribution formula.
Funding – State Fiscal Year 2013
Currently the MERC grant is derived from a carve-out to the Prepaid Medical Assistance Program (PMAP)
rates, an appropriation from Minnesota’s cigarette tax, and federal matching funds. The distribution to
fiscal year 2010 training facilities included in the MERC grant application totaled $31,216,244.
PMAP funds
Tobacco funds
Less administration*
Federal match on tobacco
Returns from previous year (State funds)
Gillette Children’s
Total
$23,936,000
$3,937,000
-$149,500
$3,787,500
$5,244
-$300,000
$31,216,244
* A maximum of $150,000 of the funds dedicated to the commissioner under section 297F.10, subdivision 1, clause
(2), may be used by the commissioner for administrative expenses associated with implementing the MERC program.
Application Process
The MERC grant application had a statutory deadline of October 31, 2011. Medicaid revenue is used in the
grant calculation; therefore, data submitted on the application reflected a two-year lag to allow for claims
processing. The MERC grant application reflected training completed in fiscal year 2010 and Medicaid
data from calendar year 2010.
Distribution by Sponsoring Institution
Sponsoring Institutions (organizations that are financially or organizationally responsible for teaching
programs) submitted applications on behalf of their accredited programs that had students/residents at
clinical training sites in Minnesota during the 2010 fiscal year. MERC grants were distributed in April
2013 to the sponsoring institutions which, in turn, are required to pass all fiscal year 2013 funding on to
their eligible training sites within 60 days as specified by statute.
In total, 21 sponsoring institutions took part in the MERC application. These sponsoring institutions
submitted applications on behalf of 224 teaching programs and 604 distinct clinical training sites. Those
sites were responsible for providing clinical training to more than 3,237 FTEs in various programs.
MERC Sponsoring Institutions
Clinical Non‐
Teaching Training Eligible Eligible Sponsoring Institution
Programs Facilities Trainees Trainees Grant
ABBOTT NORTHWESTERN HOSPITAL
2 14 4.3 33.4
$600,272
AUGSBURG COLLEGE
1 60 8.9 30.5
$319,090
CHILDREN'S HOSPITALS AND CLINICS OF MINNESOTA
1 4 0.6 2.4
$51,516
COLLEGE OF ST. SCHOLASTICA
2 94 33.0 62.8
$945,602
FAIRVIEW SOUTHDALE HOSPITAL
1 7 0.5 1.4
$56,960
HENNEPIN COUNTY MEDICAL CENTER
13 58 6.9 229.8 $4,244,222
MAYO CLINIC
91 226 228.7 1,054.8 $1,950,700
MERCY HOSPITAL
2 6 1.0 4.3
$426,424
METROPOLITAN STATE UNIVERSITY
1 76 5.7 56.0
$421,488
MINNESOTA STATE UNIVERSITY, MANKATO
1 21 90.0 8.0
$190,504
MINNESOTA STATE UNIVERSITY, MOORHEAD
1 4 2.4 0.5
$3,710
REGIONS HOSPITAL
5 36 ‐
35.2
$673,406
SAINT MARYS MEDICAL CENTER
1 1 ‐
2.0
$27,035
SAINT MARY'S UNIVERSITY OF MINNESOTA
1 16 27.0 41.0
$502,689
ST. CATHERINE UNIVERSITY
1 58 33.7 54.0
$284,057
ST. LUKE'S HOSPITAL
1 1 0.1 2.0
$18,316
THE ORTHOPAEDIC CENTER PROGRAM
1 3 0.3 2.6
$15,146
UNITED HOSPITAL
2 30 2.8 17.3
$824,570
UNIVERSITY OF MINNESOTA MEDICAL CENTER, FAIRVIEW
5 5 ‐
10.0
$61,061
UNIVERSITY OF MN ACADEMIC HEALTH CENTER
89 1,101 977.0 1,570.1 $19,429,014
WINONA STATE UNIVERSITY
2 20 4.5 19.5
$170,462
Grand Total
224 1,841 1,427.3 3,237.6 $31,216,244
Table 1
+Rounded for reporting purposes.
*Direct payment of $300,000 to Gillette Children’s not included.
Table 2
MERC Training Programs
Training Programs in Minnesota
Clinical Training Sites
Eligible FTEs
ADVANCED PRACTICE NURSES
COLLEGE OF ST. SCHOLASTICA
MAYO CLINIC
METROPOLITAN STATE UNIVERSITY
MINNESOTA STATE UNIVERSITY, MANKATO
MINNESOTA STATE UNIVERSITY, MOORHEAD
SAINT MARY'S UNIVERSITY OF MINNESOTA
ST. CATHERINE UNIVERSITY
UNIVERSITY OF MN ACADEMIC HEALTH CENTER
WINONA STATE UNIVERSITY
DENTAL RESIDENTS
HENNEPIN COUNTY MEDICAL CENTER
MAYO CLINIC
UNIVERSITY OF MN ACADEMIC HEALTH CENTER
DENTAL STUDENTS
UNIVERSITY OF MN ACADEMIC HEALTH CENTER
MEDICAL RESIDENTS
ABBOTT NORTHWESTERN HOSPITAL
FAIRVIEW SOUTHDALE HOSPITAL
HENNEPIN COUNTY MEDICAL CENTER
MAYO CLINIC
MERCY HOSPITAL
REGIONS HOSPITAL
THE ORTHOPAEDIC CENTER PROGRAM
UNITED HOSPITAL
UNIVERSITY OF MN ACADEMIC HEALTH CENTER
MEDICAL STUDENTS
MAYO CLINIC
UNIVERSITY OF MN ACADEMIC HEALTH CENTER
PHARMD RESIDENTS
ABBOTT NORTHWESTERN HOSPITAL
CHILDREN'S HOSPITALS AND CLINICS OF MINNESOTA
HENNEPIN COUNTY MEDICAL CENTER
MAYO CLINIC
MERCY HOSPITAL
SAINT MARYS MEDICAL CENTER
ST. LUKE'S HOSPITAL
UNITED HOSPITAL
UNIVERSITY OF MINNESOTA MEDICAL CENTER, FAIRVIEW
UNIVERSITY OF MN ACADEMIC HEALTH CENTER
PHARMD STUDENTS
UNIVERSITY OF MN ACADEMIC HEALTH CENTER
PHYSICIAN ASSISTANTS
AUGSBURG COLLEGE
Grand Total
413
94
4
76
21
4
16
58
120
20
33
2
6
25
6
6
875
13
7
53
208
4
36
3
29
522
211
4
207
40
1
4
3
4
2
1
1
1
5
18
203
203
60
60
1,841
353.6
62.8
40.2
56.0
8.0
0.5
41.0
54.0
71.5
19.5
72.7
5.2
12.1
55.4
154.0
154.0
1,904.7
29.2
1.4
221.5
909.1
2.2
35.2
2.6
16.0
687.5
536.1
84.6
451.5
48.2
4.2
2.4
3.2
8.7
2.1
2.0
2.0
1.3
10.0
12.4
137.7
137.7
30.5
30.5
3,237.6
MERC Provider Types
Although nine provider types are eligible for MERC funds, only eight applied. These eight provider types
encompass 224 teaching programs that train students and residents in various clinical settings. Many of
these clinical training sites support trainees from multiple sponsoring institutions, programs and provider
types. While medical residents receive the highest amount of funding, grants are actually based on the
Medicaid revenue at each training facility rather than cost of training, provider type or number of trainees.
In the case of medical residents, the majority of their training is completed in a hospital setting where
Medicaid revenue is generally higher than other facilities.
MERC Provider Types
Figure 1
Grants by Classification of the Training Site
Training takes place in a variety of settings. The five facility types in Table 3 host the highest FTE counts.
Table 3
Type of Training Facility
Hospital
Physician Clinic
Dental Clinic
Pharmacy
Federally Qualified Health Center
FTEs
2,177
747
193
57
35
MERC Facility Types
Funding
Grant/FTE
$24,420,834
$4,083,739
$9,941
$1,894,535
$245,336
$11,218
$5,470
$52
$33,187
$7,035
Percent FTEs
67.2%
23.1%
5.9%
1.8%
1.1%
Percent Funds
78.2%
13.1%
0.03%
6.1%
0.8%
The grant per FTE is higher in settings where the ratio between relative public program revenue and
number of trainee is greatest. For example, pharmacies hosted 57 FTEs and received the equivalent of
$33,187 per FTE, while dental clinics hosted 193 FTEs and received $52 per FTE.
Distribution by County
Figure 2
Distribution by County
The bulk of the distribution
continues to go to facilities in
Hennepin County and Ramsey
County, while the bulk of the
training was completed in Hennepin
County and Olmsted County. This
result is largely due to the relatively
smaller share of Medicaid volume at
clinical training facilities in Olmsted
County.
Grants to Clinical Training Sites
Sites host trainees from multiple programs and sponsoring institutions; therefore, they have the potential of
being submitted as a training site on the application more than once. The MERC application included 1,841
site applicants and 604 distinct training sites. The top 20 grantees received 70 percent of the total grant and
hosted 71 percent of the FTEs.
Table 4 shows the top 20 grant recipients in descending order, the provider type, and fiscal year 2010
FTEs.
Table 4
Top 20 Grant Recipients
Clinical Training Facility
HENNEPIN COUNTY MEDICAL CENTER
UMMC FAIRVIEW
REGIONS HOSPITAL
CHILDRENS HEALTH CARE MINNEAPOLIS
NORTH MEMORIAL HEALTH CARE
ABBOTT NORTHWESTERN HOSPITAL
MAYO CLINIC ST MARYS HOSPITAL
HENNEPIN FACULTY ASSOCIATES
CHILDRENS HOSPITALS & CLINICS OF MN
UNITED HOSPITAL INC
ST CLOUD HOSPITAL
MERCY HOSPITAL
GILLETTE CHILDRENS SPEC HOSP
MERWIN LONG TERM CARE PHARMACY #2
ESSENTIA HLTH ST MARYS MEDICAL CNTR
PARK NICOLLET METHODIST HOSP
HEALTHEAST ST JOSEPHS HOSPITAL
HEALTHEAST ST JOHNS HOSPITAL
UNITY HOSPITAL
MAYO CLINIC
Location
Provider Type
MINNEAPOLIS
HOSPITAL
MINNEAPOLIS
HOSPITAL
ST PAUL
HOSPITAL
MINNEAPOLIS
HOSPITAL
ROBBINSDALE
HOSPITAL
MINNEAPOLIS
HOSPITAL
ROCHESTER
HOSPITAL
MINNEAPOLIS
PHYSICIAN
ST PAUL
HOSPITAL
ST PAUL
HOSPITAL
ST CLOUD
HOSPITAL
COON RAPIDS
HOSPITAL
ST PAUL
HOSPITAL
NEW BRIGHTON PHARMACY
DULUTH
HOSPITAL
ST LOUIS PARK
HOSPITAL
HOSPITAL
ST PAUL
MAPLEWOOD
HOSPITAL
FRIDLEY
HOSPITAL
ROCHESTER
PHYSICIAN
+Rounded for reporting purposes.
FTEs
411.2
461.8
168.2
45.4
40.6
82.3
467.1
3.1
49.9
18.0
11.5
8.3
15.6
0.5
29.1
32.7
18.1
13.4
3.6
417.9
Grant
$ 4,691,464
$ 2,644,885
$ 2,090,597
$ 1,597,352
$ 1,099,627
$ 1,050,397
$ 1,003,058
$ 973,798
$ 932,994
$ 792,714
$ 666,658
$ 603,493
$ 528,150
$ 513,988
$ 497,883
$ 467,470
$ 457,057
$ 448,927
$ 430,208
$ 378,044
The table below shows the number of sites and FTEs whose grant is within a specific range. Over 50
percent of sites receive a grant less than $5,000 and 80 percent receive a grant less than $20,000.
Grant Ranges
Table 5
Grant $1,000,000 to $5,000,000
$500,000 to $999,999
$100,000 to $499,999
$50,000 to $99,999
$20,000 to $49,999
Number of Sites 7
7
29
28
52
FTEs $10,000 to $19,999
75
112 $5,000 to $9,999
$1,000 to $4,999
Eliminated ‐ Under $1,000 Minimum
Distinct Total
90
197
119
604
242 117 60 3,238 1,677 107 794 65 64 Twenty-five facilities hosted more than 10 FTEs in fiscal year 2010. These facilities represented 84 percent
of the FTEs trained in Minnesota and received slightly more than 65 percent of the available MERC funds.
The majority of the FTEs are hosted in seven facilities, all hosting more than 100 FTEs. Combined they
account for 70 percent of the trainees in Minnesota and received 35 percent of the available funding.
Training Sites Hosting More Than 10 FTEs
Clinical Training Facility
Location
Provider Type
MAYO CLINIC ST MARYS HOSPITAL
ROCHESTER
HOSPITAL
UMMC FAIRVIEW
MINNEAPOLIS
HOSPITAL
MAYO CLINIC
ROCHESTER
PHYSICIAN
HENNEPIN COUNTY MEDICAL CENTER
MINNEAPOLIS
HOSPITAL
MAYO CLINIC METHODIST HOSPITAL
ROCHESTER
HOSPITAL
UNIV OF MN SCHOOL OF DENTISTRY
MINNEAPOLIS
DENTIST
REGIONS HOSPITAL
ST PAUL
HOSPITAL
ABBOTT NORTHWESTERN HOSPITAL
MINNEAPOLIS
HOSPITAL
HOSPITAL
CHILDRENS HOSPITALS & CLINICS OF MN
ST PAUL
CHILDRENS HEALTH CARE MINNEAPOLIS
MINNEAPOLIS
HOSPITAL
NORTH MEMORIAL HEALTH CARE
ROBBINSDALE
HOSPITAL
PARK NICOLLET METHODIST HOSP
ST LOUIS PARK
HOSPITAL
ESSENTIA HLTH ST MARYS MEDICAL CNTR
DULUTH
HOSPITAL
HEALTHEAST ST JOSEPHS HOSPITAL
ST PAUL
HOSPITAL
UNITED HOSPITAL INC
ST PAUL
HOSPITAL
ESSENTIA HEALTH DULUTH CLINIC
DULUTH
PHYSICIAN
ST LUKES HOSPITAL
DULUTH
HOSPITAL
GILLETTE CHILDRENS SPEC HOSP
ST PAUL
HOSPITAL
PARK NICOLLET CLINICS
ST LOUIS PARK
PHYSICIAN
HEALTHEAST ST JOHNS HOSPITAL
MAPLEWOOD
HOSPITAL
UMP BROADWAY FAMILY MEDICINE
MINNEAPOLIS
PHYSICIAN
HEALTHPARTNERS SPECIALTY CENTER
ST PAUL
PHYSICIAN
ST CLOUD HOSPITAL
ST CLOUD
HOSPITAL
MAYO CLINIC HEALTH SYSTEM ‐ MANKATO
MANKATO
HOSPITAL
UMP SMILEYS CLINIC
MINNEAPOLIS
PHYSICIAN
Table 6
FTEs
467.1
461.8
417.9
411.2
177.4
172.8
168.2
82.3
49.9
45.4
40.6
32.7
29.1
18.1
18.0
16.8
16.0
15.6
13.8
13.4
13.0
12.9
11.5
11.0
10.8
Grant
$ 1,003,058
$ 2,644,885
$ 378,044
$ 4,691,464
$ 149,650
$ 5,944
$ 2,090,597
$ 1,050,397
$ 932,994
$ 1,597,352
$ 1,099,627
$ 467,470
$ 497,883
$ 457,057
$ 792,714
$ 103,573
$ 202,723
$ 528,150
$ 197,173
$ 448,927
$ 18,342
$ 80,637
$ 666,658
$ 213,454
$ 14,600
Table 7
MERC Grant Applicants Receiving More Than $25,000
Clinical Training Facility HENNEPIN COUNTY MEDICAL CENTER UMMC FAIRVIEW REGIONS HOSPITAL CHILDRENS HEALTH CARE MINNEAPOLIS NORTH MEMORIAL HEALTH CARE ABBOTT NORTHWESTERN HOSPITAL MAYO CLINIC ST MARYS HOSPITAL HENNEPIN FACULTY ASSOCIATES CHILDRENS HOSPITALS & CLINICS OF MN UNITED HOSPITAL INC ST CLOUD HOSPITAL MERCY HOSPITAL GILLETTE CHILDRENS SPEC HOSP MERWIN LONG TERM CARE PHARMACY #2 ESSENTIA HLTH ST MARYS MEDICAL CNTR PARK NICOLLET METHODIST HOSP HEALTHEAST ST JOSEPHS HOSPITAL HEALTHEAST ST JOHNS HOSPITAL UNITY HOSPITAL MAYO CLINIC MERWIN LONG TERM CARE MAYO CLINIC HEALTH SYSTEM ‐ MANKATO ST LUKES HOSPITAL UNIVERSITY OF MINNESOTA PHYSICIANS PARK NICOLLET CLINICS ESSENTIA HEALTH DULUTH AFFILIATED MEDICAL CENTERS PA ESSENTIA HEALTH‐ST JOSEPHS MED CTR FAIRVIEW SOUTHDALE HOSPITAL FAIRVIEW RIDGES HOSPITAL SANFORD BEMIDJI MEDICAL CENTER MAYO CLINIC METHODIST HOSPITAL OLMSTED MEDICAL CENTER UNIVERSITY MEDICAL CENTER ‐ MESABI OMNICARE MINNESOTA MCHS ‐ AUSTIN MEDICAL CENTER HEALTHEAST BETHESDA HOSPITAL HENNEPIN COUNTY MEDICAL CENTER CAMBRIDGE MEDICAL CENTER RICE MEMORIAL HOSPITAL LAKEWOOD HEALTH SYSTEM ESSENTIA HEALTH DULUTH CLINIC ST FRANCIS REGIONAL MEDICAL CENTER Location MINNEAPOLIS MINNEAPOLIS ST PAUL MINNEAPOLIS ROBBINSDALE MINNEAPOLIS ROCHESTER MINNEAPOLIS ST PAUL ST PAUL ST CLOUD COON RAPIDS ST PAUL NEW BRIGHTON DULUTH ST LOUIS PARK ST PAUL MAPLEWOOD FRIDLEY ROCHESTER MINNEAPOLIS MANKATO DULUTH MINNEAPOLIS ST LOUIS PARK DULUTH WILLMAR BRAINERD MINNEAPOLIS BURNSVILLE BEMIDJI ROCHESTER ROCHESTER HIBBING CRYSTAL AUSTIN ST PAUL MINNEAPOLIS CAMBRIDGE WILLMAR STAPLES DULUTH SHAKOPEE Programs Training at Facility 76 89 48 33 18 44 72 11 26 21 7 10 16 1 7 30 8 11 9 88 1 3 7 8 18 4 8 6 13 9 1 53 7 6 1 5 2 1 6 4 5 2 2 FTEs 411.2 461.8 168.2 45.4 40.6 82.3 467.1 3.1 49.9 18.0 11.5 8.3 15.6 0.5 29.1 32.7 18.1 13.4 3.6 417.9 1.0 11.0 16.0 2.1 13.8 1.7 3.3 2.5 4.5 1.8 0.2 177.4 3.6 4.3 0.7 5.4 0.8 0.1 4.1 2.8 3.8 16.8 1.1 Grant $ 4,691,464 $ 2,644,885 $ 2,090,597 $ 1,597,352 $ 1,099,627 $ 1,050,397 $ 1,003,058 $ 973,798 $ 932,994 $ 792,714 $ 666,658 $ 603,493 $ 528,150 $ 513,988 $ 497,883 $ 467,470 $ 457,057 $ 448,927 $ 430,208 $ 378,044 $ 218,629 $ 213,454 $ 202,723 $ 200,083 $ 197,173 $ 194,201 $ 182,454 $ 182,099 $ 181,937 $ 180,083 $ 151,824 $ 149,650 $ 144,360 $ 139,014 $ 137,136 $ 134,439 $ 127,551 $ 121,634 $ 119,388 $ 117,368 $ 111,839 $ 103,573 $ 101,545 Clinical Training Facility ST MARYS INNOVIS HEALTH HEALTHEAST WOODWINDS HOSPITAL MAYO HEALTH SYSTEM ‐ ALBERT LEA FAIRVIEW LAKES REGIONAL MEDICAL CTR FAIRMONT MED CTR MAYO HEALTH WINONA HEALTH SERVICES LAKE REGION HEALTHCARE CORP HEALTHPARTNERS SPECIALTY CENTER MAYO CLINIC HEALTH SYSTEM RED WING GRAND ITASCA CLINIC & HOSPITAL OWATONNA HOSPITAL RIDGEVIEW MEDICAL CENTER NEW ULM MEDICAL CENTER FAIRVIEW NORTHLAND REGIONAL HOSP PARK NICOLLET CLINIC MEADOWBROOK NORTHPOINT HEALTH AND WELLNESS CTR ST GABRIELS HOSPITAL CUYUNA REGIONAL MEDICAL CENTER PPMNS HIGHLAND COMMUNITY UNIVERSITY HEALTH CARE ESSENTIA HEALTH VIRGINIA HEALTHPARTNERS RIVERSIDE FOND DU LAC HUMAN SERVICES DIVISION MN VISITING NURSE AGENCY MANKATO CLINIC LTD DISTRICT ONE HOSPITAL GLENCOE REGIONAL HEALTH SERVICES NORTHERN PINES MENTAL HEALTH CENTER REGINA MEDICAL CENTER FIRSTLIGHT HEALTH SYSTEM FALKS NURSING SERVICE PHARMACY HEALTHPARTNERS MIDWAY CLINIC ANOKA METRO REG TRTMNT CTR RIVERWOOD HEALTHCARE CENTER COMMUNITY MEMORIAL HOSPITAL CENTRACARE CLINIC RIVER CAMPUS CANVAS HEALTH INCORPORATED CHILD & ADOLESCENT BEHAVIORAL HLTH HEALTHPARTNERS CENTRAL MN CLINICS CHILDREN'S RESP & CRITICAL CARE OWATONNA CLINIC ‐ MAYO HEALTH SYS HEALTHPARTNERS ST PAUL MERCY HOSPITAL & HEALTH CARE CENTER NORTHFIELD HOSPITAL Location DETROIT LAKES WOODBURY ALBERT LEA WYOMING FAIRMONT WINONA FERGUS FALLS ST PAUL RED WING GRAND RAPIDS OWATONNA WACONIA NEW ULM PRINCETON ST LOUIS PARK MINNEAPOLIS LITTLE FALLS CROSBY ST PAUL MINNEAPOLIS VIRGINIA MINNEAPOLIS CLOQUET MINNEAPOLIS MANKATO FARIBAULT GLENCOE LITTLE FALLS HASTINGS MORA DULUTH ST PAUL ANOKA AITKIN CLOQUET ST CLOUD OAKDALE WILLMAR SARTELL MINNEAPOLIS OWATONNA ST PAUL MOOSE LAKE NORTHFIELD Programs Training at Facility 2 4 4 3 1 1 2 20 5 4 3 5 6 4 5 4 1 1 2 14 2 5 4 3 3 1 5 2 1 4 1 6 2 6 2 1 1 1 2 2 8 4 1 2 FTEs 1.2 1.5 1.7 0.9 1.5 1.0 2.3 12.9 2.3 3.1 2.6 3.2 2.6 4.4 2.0 3.4 0.1 0.1 0.1 8.9 1.4 0.8 0.9 0.7 1.0 0.8 2.5 0.8 0.3 3.6 0.5 3.1 3.6 2.8 0.7 1.4 0.2 0.4 0.5 0.1 4.7 1.5 0.3 1.1 Grant $ 96,906 $ 95,623 $ 93,531 $ 93,039 $ 92,227 $ 87,613 $ 87,420 $ 80,637 $ 78,496 $ 74,212 $ 71,735 $ 70,319 $ 70,289 $ 69,143 $ 68,825 $ 65,173 $ 60,265 $ 56,217 $ 55,166 $ 54,669 $ 53,956 $ 53,077 $ 52,460 $ 52,426 $ 51,729 $ 51,658 $ 51,472 $ 50,483 $ 44,748 $ 43,667 $ 42,147 $ 41,069 $ 40,163 $ 39,852 $ 39,796 $ 38,803 $ 38,431 $ 38,236 $ 37,673 $ 36,936 $ 36,546 $ 36,339 $ 35,632 $ 34,365 Clinical Training Facility FAIRVIEW UNIVERSITY CLINIC PHARMACY ISJ CLINIC ‐ NORTH RIDGE CENTRACARE CLINIC‐WOMEN CHILDRENS FAIRVIEW HOME INFUSION RAINY LAKE MEDICAL CENTER PARK NICOLLET CLINIC BURNSVILLE ALLINA MEDICAL CLINIC COON RAPIDS WALGREENS INFUSION SERVICES RANGE MENTAL HEALTH CENTER WILDER CHILDREN AND FAMILY SERVICES HOSPICE OF THE TWIN CITIES INC ESSENTIA HEALTH FOSSTON FAIRVIEW UNIVERSITY CLINIC PHARMACY HUMAN DEVELOPMENT CENTER INC PARK NICOLLET CLINIC BROOKDALE WALGREENS PHARMACY #03832 FAIRVIEW SPECIALTY SERVICES PHARM Location Programs Training at Facility MINNEAPOLIS NORTH MANKATO ST CLOUD MINNEAPOLIS INTL FALLS BURNSVILLE COON RAPIDS SAUK RAPIDS VIRGINIA ST PAUL MINNEAPOLIS FOSSTON MINNEAPOLIS DULUTH BROOKLYN CENTER BROOKLYN PARK MINNEAPOLIS 1 2 1 1 1 6 2 1 1 2 2 2 1 3 6 1 1 FTEs 0.5 0.4 0.6 0.6 0.4 3.0 0.4 2.5 1.0 1.1 0.0 0.3 0.8 2.5 3.9 0.1 0.2 Grant $ 34,199 $ 32,821 $ 32,447 $ 32,248 $ 31,192 $ 31,104 $ 30,437 $ 30,427 $ 29,891 $ 28,801 $ 27,867 $ 27,766 $ 26,589 $ 26,478 $ 26,408 $ 25,446 $ 25,120 +Where possible, FTE and grant totals are rounded for reporting purposes.
Some sites have similar names, but are considered separate facility locations based on enrollment in the Minnesota Health Care
Program.
If you have any questions related to the materials discussed in the report, please contact Diane Reger at
[email protected] or 651/201-3566. Detailed reports showing grant payments to individual training sites
are also available on the MERC website: http://www.health.state.mn.us/divs/hpsc/hep/merc/grantupdates.html.
Commissioner’s Office
625 Robert St. N.
P.O. Box 64975
St. Paul, MN 55164-0975
Office of Rural Health and Primary Care, Health Policy Division
PO Box 64882
St. Paul, MN 55164-0882
651-201-3859
www.health.state.mn.us
2013 MERC Legislation
MDH distributes grants to clinical training sites to offset costs associated with providing clinical education to
medical, dental, pharmacy, advanced practice nursing, physician assistant, and chiropractic students and
residents.
2013 Changes
The changes adopted will strengthen the MERC
Summary
The 2013 legislation will support the workforce
program by addressing concerns related to
distribution of funds at the high and low ends of the
needs of a changing health system by increasing
scale, increasing accountability, and more closely
funding for clinical education and updating the
aligning the distribution formula with state
state’s financial support mechanism.
workforce goals. The changes will:
Background
• Increase funding by $12,808,000 ($6,404,000
The Medical Education and Research Cost (MERC)
each state funds and federal matching funds) to
program has helped support the hospitals, clinics
return the program to its 2011 level of
and other sites that perform this critical work since
$57,126,000.
1997.
• Reduce the 20% bonus to sites with Medicaid
revenue above an arbitrary level to 10% for two
In 2013, 604 hospitals, clinics and other clinical
years and then eliminate it. This will more
training sites trained more than 3,237 medical,
evenly distribute funds to small and rural sites
dental, pharmacy, advanced practice nursing and
important to meeting workforce goals statewide,
physician assistant students and residents with
while continuing to meet federal guidelines for
MERC program funds.
distribution of funds.
• Add important primary care providers
State and federal Medical Assistance funds and
(psychologists, clinical social workers,
cigarette tax proceeds fund the program. The
community paramedics, community health
program’s FY 14 – 15 base budget is $44,318,000.
workers, dental therapists and advanced dental
therapists).
The distribution formula has changed over the
• Limit funds awarded per trainee to no more than
years. Initially, it was based solely on the amount
the 95th percentile of the average award per
and cost of training provided at each site; over time,
trainee so sites that train a very small number of
some formulas balanced training and Medicaid
students or residents no longer receive
volume. Medicaid volume has been the sole factor
disproportionately large grants.
determining grant amounts since 2007, with a 20%
• Raise the minimum grant from $1,000 to $5,000
“bonus payment” to sites at the top of the
to ensure that grant size is meaningful and the
distribution.
program is administratively simpler.
• Limit eligibility to sites with more than 0.1
trainees, to ensure that funding is directed to
July 2013
2013 MERC Legislation – Page 2
•
•
•
sites that train at least a minimal amount of
trainees and to encourage sites to take on
additional trainees to stay above the minimum.
Establish a $1 million per year grant program
for family medicine residency programs outside
of the seven-county metropolitan area.
Add clearer accountability provisions to the
program, to make explicit that funds must be
used for costs associated with clinical training.
Seek federal approval for changes.
Benefits
Restoring the health professions program to its 2011
level, along with the other changes proposed, will
help stabilize health professions training in
Minnesota, and investing grants directly in rural
residency programs will further help address
shortages in rural Minnesota.
For more information, contact:
Health Policy, ORHPC
Email: [email protected]
651-201-3859
July 2013
MERC Legislation – 2013 session 217.15 Sec. 20. Minnesota Statutes 2012, section 256B.69, subdivision 5c, is amended to read:
217.16 Subd. 5c. Medical education and research fund. (a) The commissioner of human
217.17services shall transfer each year to the medical education and research fund established
217.18under section 62J.692, an amount specified in this subdivision. The commissioner shall
217.19calculate the following:
217.20(1) an amount equal to the reduction in the prepaid medical assistance payments as
217.21specified in this clause. Until January 1, 2002, the county medical assistance capitation
217.22base rate prior to plan specific adjustments and after the regional rate adjustments under
217.23subdivision 5b is reduced 6.3 percent for Hennepin County, two percent for the remaining
217.24metropolitan counties, and no reduction for nonmetropolitan Minnesota counties; and after
217.25January 1, 2002, the county medical assistance capitation base rate prior to plan specific
217.26adjustments is reduced 6.3 percent for Hennepin County, two percent for the remaining
217.27metropolitan counties, and 1.6 percent for nonmetropolitan Minnesota counties. Nursing
217.28facility and elderly waiver payments and demonstration project payments operating
217.29under subdivision 23 are excluded from this reduction. The amount calculated under
217.30this clause shall not be adjusted for periods already paid due to subsequent changes to
217.31the capitation payments;
217.32(2) beginning July 1, 2003, $4,314,000 from the capitation rates paid under this
217.33section;
217.34(3) beginning July 1, 2002, an additional $12,700,000 from the capitation rates
217.35paid under this section; and
218.1(4) beginning July 1, 2003, an additional $4,700,000 from the capitation rates paid
218.2under this section.
218.3(b) This subdivision shall be effective upon approval of a federal waiver which
218.4allows federal financial participation in the medical education and research fund. The
218.5amount specified under paragraph (a), clauses (1) to (4), shall not exceed the total amount
218.6transferred for fiscal year 2009. Any excess shall first reduce the amounts specified under
218.7paragraph (a), clauses (2) to (4). Any excess following this reduction shall proportionally
218.8reduce the amount specified under paragraph (a), clause (1).
218.9(c) Beginning September 1, 2011, of the amount in paragraph (a), the commissioner
218.10shall transfer $21,714,000 each fiscal year to the medical education and research fund.
218.11(d) Beginning September 1, 2011, of the amount in paragraph (a), following the
218.12transfer under paragraph (c), the commissioner shall transfer to the medical education
218.13research fund $23,936,000 in fiscal years 2012 and 2013 and $36,744,000 $49,552,000 in
218.14fiscal year 2014 and thereafter.
513.5 Section 1. Minnesota Statutes 2012, section 16A.724, subdivision 2, is amended to read:
513.6 Subd. 2. Transfers. (a) Notwithstanding section 295.581, to the extent available
513.7resources in the health care access fund exceed expenditures in that fund, effective for
513.8the biennium beginning July 1, 2007, the commissioner of management and budget shall
513.9transfer the excess funds from the health care access fund to the general fund on June 30
513.10of each year, provided that the amount transferred in any fiscal biennium shall not exceed
513.11$96,000,000. The purpose of this transfer is to meet the rate increase required under Laws
513.122003, First Special Session chapter 14, article 13C, section 2, subdivision 6.
513.13 (b) For fiscal years 2006 to 2011, MinnesotaCare shall be a forecasted program, and,
513.14if necessary, the commissioner shall reduce these transfers from the health care access
513.15fund to the general fund to meet annual MinnesotaCare expenditures or, if necessary,
513.16transfer sufficient funds from the general fund to the health care access fund to meet
513.17annual MinnesotaCare expenditures.
513.18(c) Notwithstanding section 295.581, to the extent available resources in the health
513.19care access fund exceed expenditures in that fund after the transfer required in paragraph
513.20(a), effective for the biennium beginning July 1, 2013, the commissioner of management
513.21and budget shall transfer $1,000,000 each fiscal year from the health access fund to
513.22the medical education and research costs fund established under section 62J.692, for
513.23distribution under section 62J.692, subdivision 4, paragraph (c).
515.12 Sec. 4. Minnesota Statutes 2012, section 62J.692, subdivision 1, is amended to read:
515.13 Subdivision 1. Definitions. For purposes of this section, the following definitions
515.14apply:
515.15 (a) "Accredited clinical training" means the clinical training provided by a medical
515.16education program that is accredited through an organization recognized by the Department
515.17of Education, the Centers for Medicare and Medicaid Services, or another national body
515.18who reviews the accrediting organizations for multiple disciplines and whose standards
515.19for recognizing accrediting organizations are reviewed and approved by the commissioner
515.20of health in consultation with the Medical Education and Research Advisory Committee.
515.21 (b) "Commissioner" means the commissioner of health.
515.22 (c) "Clinical medical education program" means the accredited clinical training of
515.23physicians (medical students and residents), doctor of pharmacy practitioners, doctors
515.24of chiropractic, dentists, advanced practice nurses (clinical nurse specialists, certified
515.25registered nurse anesthetists, nurse practitioners, and certified nurse midwives), and
515.26physician assistants, dental therapists and advanced dental therapists, psychologists,
515.27clinical social workers, community paramedics, and community health workers.
515.28 (d) "Sponsoring institution" means a hospital, school, or consortium located in
515.29Minnesota that sponsors and maintains primary organizational and financial responsibility
515.30for a clinical medical education program in Minnesota and which is accountable to the
515.31accrediting body.
515.32 (e) "Teaching institution" means a hospital, medical center, clinic, or other
515.33organization that conducts a clinical medical education program in Minnesota.
515.34 (f) "Trainee" means a student or resident involved in a clinical medical education
515.35program.
516.1 (g) "Eligible trainee FTE's" means the number of trainees, as measured by full-time
516.2equivalent counts, that are at training sites located in Minnesota with currently active
516.3medical assistance enrollment status and a National Provider Identification (NPI) number
516.4where training occurs in either an inpatient or ambulatory patient care setting and where
516.5the training is funded, in part, by patient care revenues. Training that occurs in nursing
516.6facility settings is not eligible for funding under this section.
516.7
516.8
Sec. 5. Minnesota Statutes 2012, section 62J.692, subdivision 3, is amended to read:
Subd. 3. Application process. (a) A clinical medical education program conducted
516.9in Minnesota by a teaching institution to train physicians, doctor of pharmacy practitioners,
516.10dentists, chiropractors, or physician assistants is, dental therapists and advanced dental
516.11therapists, psychologists, clinical social workers, community paramedics, or community
516.12health workers are eligible for funds under subdivision 4 if the program:
516.13(1) is funded, in part, by patient care revenues;
516.14(2) occurs in patient care settings that face increased financial pressure as a result
516.15of competition with nonteaching patient care entities; and
516.16(3) emphasizes primary care or specialties that are in undersupply in Minnesota.
516.17(b) A clinical medical education program for advanced practice nursing is eligible for
516.18funds under subdivision 4 if the program meets the eligibility requirements in paragraph
516.19(a), clauses (1) to (3), and is sponsored by the University of Minnesota Academic Health
516.20Center, the Mayo Foundation, or institutions that are part of the Minnesota State Colleges
516.21and Universities system or members of the Minnesota Private College Council.
516.22(c) Applications must be submitted to the commissioner by a sponsoring institution
516.23on behalf of an eligible clinical medical education program and must be received by
516.24October 31 of each year for distribution in the following year. An application for funds
516.25must contain the following information:
516.26(1) the official name and address of the sponsoring institution and the official
516.27name and site address of the clinical medical education programs on whose behalf the
516.28sponsoring institution is applying;
516.29(2) the name, title, and business address of those persons responsible for
516.30administering the funds;
516.31(3) for each clinical medical education program for which funds are being sought;
516.32the type and specialty orientation of trainees in the program; the name, site address, and
516.33medical assistance provider number and national provider identification number of each
516.34training site used in the program; the federal tax identification number of each training site
517.1used in the program, where available; the total number of trainees at each training site; and
517.2the total number of eligible trainee FTEs at each site; and
517.3(4) other supporting information the commissioner deems necessary to determine
517.4program eligibility based on the criteria in paragraphs (a) and (b) and to ensure the
517.5equitable distribution of funds.
517.6(d) An application must include the information specified in clauses (1) to (3) for
517.7each clinical medical education program on an annual basis for three consecutive years.
517.8After that time, an application must include the information specified in clauses (1) to (3)
517.9when requested, at the discretion of the commissioner:
517.10(1) audited clinical training costs per trainee for each clinical medical education
517.11program when available or estimates of clinical training costs based on audited financial
517.12data;
517.13(2) a description of current sources of funding for clinical medical education costs,
517.14including a description and dollar amount of all state and federal financial support,
517.15including Medicare direct and indirect payments; and
517.16(3) other revenue received for the purposes of clinical training.
517.17(e) An applicant that does not provide information requested by the commissioner
517.18shall not be eligible for funds for the current funding cycle.
517.19
Sec. 6. Minnesota Statutes 2012, section 62J.692, subdivision 4, is amended to read:
517.20 Subd. 4. Distribution of funds. (a) The commissioner shall annually distribute the
517.21available medical education funds to all qualifying applicants based on a distribution
517.22formula that reflects a summation of two factors:
517.23 (1) a public program volume factor, which is determined by the total volume of
517.24public program revenue received by each training site as a percentage of all public
517.25program revenue received by all training sites in the fund pool; and
517.26 (2) a supplemental public program volume factor, which is determined by providing
517.27a supplemental payment of 20 percent of each training site's grant to training sites whose
517.28public program revenue accounted for at least 0.98 percent of the total public program
517.29revenue received by all eligible training sites. Grants to training sites whose public
517.30program revenue accounted for less than 0.98 percent of the total public program revenue
517.31received by all eligible training sites shall be reduced by an amount equal to the total
517.32value of the supplemental payment.
517.33 Public program revenue for the distribution formula includes revenue from medical
517.34assistance, prepaid medical assistance, general assistance medical care, and prepaid
517.35general assistance medical care. Training sites that receive no public program revenue
518.1are ineligible for funds available under this subdivision. For purposes of determining
518.2training-site level grants to be distributed under paragraph (a) this paragraph, total
518.3statewide average costs per trainee for medical residents is based on audited clinical
518.4training costs per trainee in primary care clinical medical education programs for medical
518.5residents. Total statewide average costs per trainee for dental residents is based on
518.6audited clinical training costs per trainee in clinical medical education programs for
518.7dental students. Total statewide average costs per trainee for pharmacy residents is based
518.8on audited clinical training costs per trainee in clinical medical education programs for
518.9pharmacy students. Training sites whose training site level grant is less than $1,000
518.10$5,000, based on the formula described in this paragraph, or that train fewer than 0.1 FTE
518.11eligible trainees, are ineligible for funds available under this subdivision. No training sites
518.12shall receive a grant per FTE trainee that is in excess of the 95th percentile grant per FTE
518.13across all eligible training sites; grants in excess of this amount will be redistributed to
518.14other eligible sites based on the formula described in this paragraph.
518.15(b) For funds distributed in fiscal years 2014 and 2015, the distribution formula shall
518.16include a supplemental public program volume factor, which is determined by providing
518.17a supplemental payment to training sites whose public program revenue accounted for
518.18at least 0.98 percent of the total public program revenue received by all eligible training
518.19sites. The supplemental public program volume factor shall be equal to ten percent of each
518.20training sites grant for funds distributed in fiscal year 2014 and for funds distributed in
518.21fiscal year 2015. Grants to training sites whose public program revenue accounted for less
518.22than 0.98 percent of the total public program revenue received by all eligible training sites
518.23shall be reduced by an amount equal to the total value of the supplemental payment. For
518.24fiscal year 2016 and beyond, the distribution of funds shall be based solely on the public
518.25program volume factor as described in paragraph (a).
518.26(c) Of available medical education funds, $1,000,000 shall be distributed each year
518.27for grants to family medicine residency programs located outside of the seven-county
518.28metropolitan area, as defined in section 473.121, subdivision 4, focused on eduction and
518.29training of family medicine physicians to serve communities outside the metropolitan area.
518.30To be eligible for a grant under this paragraph, a family medicine residency program must
518.31demonstrate that over the most recent three calendar years, at least 25 percent of its
residents
518.32practice in Minnesota communities outside of the metropolitan area. Grant funds must be
518.33allocated proportionally based on the number of residents per eligible residency program.
518.34 (b) (d) Funds distributed shall not be used to displace current funding appropriations
518.35from federal or state sources.
519.1 (c) (e) Funds shall be distributed to the sponsoring institutions indicating the amount
519.2to be distributed to each of the sponsor's clinical medical education programs based on
519.3the criteria in this subdivision and in accordance with the commissioner's approval letter.
519.4Each clinical medical education program must distribute funds allocated under paragraph
519.5paragraphs (a) and (b) to the training sites as specified in the commissioner's approval
519.6letter. Sponsoring institutions, which are accredited through an organization recognized
519.7by the Department of Education or the Centers for Medicare and Medicaid Services, may
519.8contract directly with training sites to provide clinical training. To ensure the quality of
519.9clinical training, those accredited sponsoring institutions must:
519.10 (1) develop contracts specifying the terms, expectations, and outcomes of the clinical
519.11training conducted at sites; and
519.12 (2) take necessary action if the contract requirements are not met. Action may include
519.13the withholding of payments under this section or the removal of students from the site.
519.14 (d) (f) Use of funds is limited to expenses related to clinical training program costs
519.15for eligible programs.
519.16 (g) Any funds not distributed in accordance with the commissioner's approval letter
519.17must be returned to the medical education and research fund within 30 days of receiving
519.18notice from the commissioner. The commissioner shall distribute returned funds to the
519.19appropriate training sites in accordance with the commissioner's approval letter.
519.20 (e) (h) A maximum of $150,000 of the funds dedicated to the commissioner
519.21under section 297F.10, subdivision 1, clause (2), may be used by the commissioner for
519.22administrative expenses associated with implementing this section.
519.23 Sec. 7. Minnesota Statutes 2012, section 62J.692, subdivision 5, is amended to read:
519.24 Subd. 5. Report. (a) Sponsoring institutions receiving funds under this section
519.25must sign and submit a medical education grant verification report (GVR) to verify that
519.26the correct grant amount was forwarded to each eligible training site. If the sponsoring
519.27institution fails to submit the GVR by the stated deadline, or to request and meet
519.28the deadline for an extension, the sponsoring institution is required to return the full
519.29amount of funds received to the commissioner within 30 days of receiving notice from
519.30the commissioner. The commissioner shall distribute returned funds to the appropriate
519.31training sites in accordance with the commissioner's approval letter.
519.32 (b) The reports must provide verification of the distribution of the funds and must
519.33 include:
519.34 (1) the total number of eligible trainee FTEs in each clinical medical education
519.35 program;
520.1 (2) the name of each funded program and, for each program, the dollar amount
520.2 distributed to each training site and a training site expenditure report;
520.3 (3) documentation of any discrepancies between the initial grant distribution notice
520.4 included in the commissioner's approval letter and the actual distribution;
520.5 (4) a statement by the sponsoring institution stating that the completed grant
520.6 verification report is valid and accurate; and
520.7 (5) other information the commissioner, with advice from the advisory committee,
520.8 deems appropriate to evaluate the effectiveness of the use of funds for medical education.
520.9 (c) By February 15 of Each year, the commissioner, with advice from the
520.10 advisory committee, shall provide an annual summary report to the legislature on the
520.11implementation of this section.
520.12 Sec. 8. Minnesota Statutes 2012, section 62J.692, subdivision 9, is amended to read:
520.13 Subd. 9. Review of eligible providers. The commissioner and the Medical
520.14Education and Research Costs Advisory Committee may review provider groups included
520.15in the definition of a clinical medical education program to assure that the distribution
520.16of the funds continue to be consistent with the purpose of this section. The results of
520.17any such reviews must be reported to the chairs and ranking minority members of the
520.18legislative committees with jurisdiction over health care policy and finance.
520.19 Sec. 9. Minnesota Statutes 2012, section 62J.692, is amended by adding a subdivision
520.20to read:
520.21 Subd. 11. Distribution of funds. If federal approval is not received for the formula
520.22described in subdivision 4, paragraphs (a) and (b), 100 percent of available medical
520.23education and research funds shall be distributed based on a distribution formula that
520.24reflects as summation of two factors:
520.25(1) a public program volume factor, that is determined by the total volume of public
520.26program revenue received by each training site as a percentage of all public program
520.27revenue received by all training sites in the fund pool; and
520.28(2) a supplemental public program volume factor, that is determined by providing a
520.29supplemental payment of 20 percent of each training site's grant to training sites whose
520.30public program revenue accounted for a least 0.98 percent of the total public program
520.31revenue received by all eligible training sites. Grants to training sites whose public
520.32program revenue accounted for less than 0.98 percent of the total public program revenue
520.33received by all eligible training sites shall be reduced by an amount equal to the total
520.34value of the supplemental payment. MERC PROGRAM
JULY 1, 2014 – JUNE 30, 2015 EXPENDITURE REPORT
Due back to MDH by: August 31, 2015
A. Grantee Information
Site Name:
City:
State:
Administrator / CEO:
Address:
Zip:
Phone:
Fax:
E-mail:
Amount of MERC Award: $
B. Grant Program Expenditures and Activities
1) List the percent of funds and the dollar amount of your site’s MERC grant expenditures that were used for the
following categories.
EXPENDITURE CATEGORY
Student / Resident Costs
Faculty Costs
Administrative / Overhead Costs
Education – related care Delivery Costs
TOTAL
AMOUNT
%
Expenditure category definitions:
Student / Resident Costs: Stipends / Benefits, Housing & Amenities, Educational Conferences / Classes,
Simulation Training, Malpractice Insurance, Research
Faculty Costs; Teaching Time / Preceptors, Training Faculty, Support Staff Salaries, Teaching Materials
Administrative / Overhead Costs: Training Related Equipment, Dues / Licenses / Fees / Subscriptions,
Infrastructure / Facility Space (e.g. call rooms, workrooms, conference/lecture room), Environmental and
Occupational Health and Safety Services (e.g. Mantoux, blood and body fluid exposures, etc.)
Education – related care Delivery Costs: Additional Tests / Orders , Higher Staff Ratio to Support Clinical
Education, Administrative Record Keeping and Documentation
2) Briefly describe your site’s activities in the following areas:
Use of Funds / Activities
Student / Resident Costs
Faculty Costs
Administrative / Overhead
Costs
Education – related care
Delivery Costs
1 of 2
C.
Site Needs (Optional) In addition to the activities described above (section B-3), describe any additional needs
that your site may have and how MERC funds could be used to meet those needs.
E. Recommendations for MERC (Optional) List any recommendation that you may have for improving the
MERC grant program.
CEO, CFO or Authorized Representative Signature:
Date:
2 of 2
PERSPE C T I V E
financing graduate medical education
Financing Graduate Medical Education — Mounting Pressure
for Reform
John K. Iglehart
D
isparate voices from the
White House, a national fiscal commission, Congress, a Medicare advisory body, private foundations, and academic medical
leaders are advocating changes
to Medicare’s investment in graduate medical education (GME),
which currently totals $9.5 billion annually. They offer various
prescriptions, including reducing
federal support, developing new
achievement measures for which
GME programs should be held
accountable, and seeking independent assessment of the governance and financing of training
programs. The recommendations
come at a time when, whatever
the outcome of the November
election, Congress and the White
House will soon resume their
close scrutiny of federal programs
in an effort to reduce the massive federal deficit.
The influential GME community has withstood most past efforts to change Medicare’s GME
policies. But recognizing today’s
more challenging political environment, the Association of American Medical Colleges (AAMC)
has begun discussing alternative
methods of financing GME that
could better align training with
the future health care delivery
system and address U.S. workforce needs. The association is
also examining the influence of
student debt on the enrollment of
a diverse student body.
When Congress enacted Medicare in 1965, it assigned to the
program functions that reached
well beyond its mission of financing health care for the elderly.
One function was supporting
GME, at least until the society at
1562
large undertook “to bear such education costs in some other way.”
Almost 50 years later, Medicare
remains the largest supporter of
GME, providing both direct payments to hospitals that cover medical education expenses related
to the care of Medicare patients
(about $3 billion per year) and an
indirect medical education (IME)
adjustment to teaching hospitals
for the added patient-care costs
associated with training (about
$6.5 billion).
Congress has rejected the attempts of most past administrations to reduce Medicare’s GME
support, although in the Balanced
Budget Act of 1997, legislators did
cap the program’s support for
training. In its 2013 budget, unveiled on February 13, 2012, the
Obama administration proposed
reducing Medicare’s IME adjustment by $9.7 billion over 10 years,
beginning in 2014, citing a report from the Medicare Payment
Advisory Commission (MedPAC)
indicating that Medicare’s IME
adjustments “significantly exceed
the actual added patient care costs
these hospitals incur.”1
The administration also proposed that the secretary of health
and human services be granted
the authority to assess GME programs’ performance in instilling
in residents the necessary skills
to promote high-quality health
care. Similarly, MedPAC had recommended redirecting about half
the IME adjustments ($3.5 billion) into “incentive payments”
that GME programs could earn
by meeting performance standards.1 The Obama budget would
also eliminate coverage of the IME
expenses of free-standing chil-
dren’s hospitals with pediatric
residency programs — which do
not treat Medicare patients — reducing their federal support by
66% (to $88 million).
In recent years, Congress has
revealed its uncertainty over how
to change federal workforce policy.2 In the Affordable Care Act
(ACA), Congress emphasized the
importance of expanding the primary care workforce. But legislators rejected the AAMC’s call
to expand the number of Medicare-funded GME positions by
15% in response to reported physician shortages in some specialties. And the National Commission on Fiscal Responsibility and
Reform, which included 14 senior congressional leaders, recommended substantial reductions
in Medicare’s GME support but
failed to muster the votes necessary to send its package to the
House and Senate floor for consideration.
On December 21, seven senators — Democrats Michael Bennet
(CO), Jeff Bingaman (NM), Mark
Udall (CO), and Tom Udall (NM)
and Republicans Mike Crapo (ID),
Chuck Grassley (IA), and Jon Kyl
(AZ) — sent a letter to the Institute of Medicine (IOM) encouraging it to “conduct an independent review of the governance
and financing of our system of
[GME].” They urged the IOM to
explore subjects including accreditation; reimbursement policy; the
use of GME to better predict and
ensure adequate workforce supply in terms of type of provider,
specialty, and demographic mix;
GME’s role in care of the underserved; and use of GME to ensure the creation of a workforce
n engl j med 366;17 nejm.org april 26, 2012
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PERSPECTIVE
with the skills necessary for addressing future health care needs.
The senators emphasized their
interest “in IOM’s observations
about the uneven distribution of
GME funding across states based
on need and capacity, and how
to address this inequity.” In an
interview, Bingaman said he initiated the letter for the same
reasons he had championed creation of a National Health Care
Workforce Commission as part of
the ACA: to strengthen the government’s resolve to do “a more
credible job of assessing workforce shortages” and because he
believes Medicare’s GME policies
are “outmoded.” Republicans have
opposed appropriating the $3 million requested for launching the
workforce commission because its
authority derives from the ACA.
The priorities cited in the IOM
letter parallel some of the recommendations of a group of academic medical leaders who gathered
at two conferences underwritten
by the Josiah Macy Jr. Foundation.
At the first conference, in October 2010, the top recommendation was that “an independent
external review of the goals, governance, and financing of the
GME system should be undertaken by the Institute of Medicine, or a similar body.”3 George
Thibault, president of the Macy
Foundation, says the group concluded that “because GME is a
public good and is significantly
financed with public dollars, the
GME system must be accountable
to the needs of the public.” Acknowledging that some people
in academic medicine “favor a
behind-the-scenes discussion of
GME reform alternatives,” Thi­
bault noted, “I believe we should
be upfront, providing examples of
change that could influence the
thinking of policymakers.” The
foundation awarded the IOM
financing graduate medical education
$750,000 — about half the support it needs for the GME study.
The AAMC has strongly opposed reductions in federal GME
support, asserting that such reductions would destabilize programs. But the association and
its teaching-hospital members recognize that training programs
may face a more hostile environment as Congress grapples with
deficit reduction. Among subjects
under discussion are the collection of more data highlighting
the importance of the safety-net
functions and unique services of
academic medical centers and the
creation of a long-term vision for
GME financing that is more closely aligned with emerging care delivery models, such as accountable
care organizations. The association is also revisiting a potential
financial model under which all
health care payers would explicitly cover GME expenses. Private
insurers maintain that they accomplish this implicitly by paying teaching hospitals more for
clinical services than they pay
most other hospitals. GME leaders think one possibility would
be to include the costs of residency training when calculating
premium amounts for products
sold through health insurance exchanges. Similarly, a recent Carnegie Foundation report asserted
that “GME redesign demands
. . . a more broad-based, less
politicized flow of funds.”4
“We recognize that GME programs must accelerate their efforts to demonstrate accountability for the support Medicare
provides for advanced training,”
said Dr. Darrell Kirch, chief executive officer of the AAMC, “and
we are prepared to engage in that
discussion with policymakers.”
Kirch added, “A significant step
forward is the announcement by
the ACGME [Accreditation Counn engl j med 366;17 nejm.org april 26, 2012
cil for Graduate Medical Education] describing major changes in
how the nation’s residency programs will be accredited in the
future, putting in place an outcomes-based evaluation system
by which new physicians will be
measured for their competency in
performing the essential tasks
necessary for clinical practice in
the 21st century.”5
Congress won’t address Medicare’s future until its 113th session convenes in January 2013,
with the probable exception of
eliminating the 27% reduction in
Medicare’s physician fees scheduled to take effect January 1.
However, under the Budget Control Act crafted by the Joint Select Committee on Deficit Reduction (the super committee), all
federal programs will be subject
to a 2% budget cut over the period from 2013 through 2021 —
cuts totaling $1.2 trillion. And
that’s likely to be only the first
skirmish in a prolonged partisan battle over deficit reduction.
Disclosure forms provided by the author
are available with the full text of this article at NEJM.org.
Mr. Iglehart is a national correspondent for
the Journal.
This article (10.1056/NEJMp1114236) was
published on March 21, 2012, at NEJM.org.
1. Report to the Congress: aligning incentives in Medicare. Washington, DC: Medicare Payment Advisory Commission, June
2010:103-29.
2. Iglehart JK. The uncertain future of Medicare and graduate medical education. N Engl
J Med 2011;365:1340-5.
3. Ensuring an effective physician workforce
for America: recommendations for an accountable graduate medical education system — conference summary, October 2010,
Atlanta. New York: Josiah Macy Jr. Foundation, 2010.
4. Cooke M, Irby DM, O’Brien BC. Educating
physicians: a call for reform of medical
school and residency. San Francisco: JosseyBass, 2010.
5. Nasca TJ, Philbert I, Brigham T, Flynn TC.
The next GME accreditation system — rationale and benefits. N Engl J Med 2012;366:
1051-6.
Copyright © 2012 Massachusetts Medical Society.
1563
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The
n e w e ng l a n d j o u r na l
of
m e dic i n e
he a lth p ol ic y r ep or t
The Uncertain Future of Medicare and Graduate
Medical Education
John K. Iglehart
In America’s freewheeling economy, the nation’s
supply of physicians has fluctuated widely over
decades, driven by countless decisions of individuals, private organizations, and governments.
In this complicated mix, the federal government
has remained a strong supporter of graduate medical education (GME), the pathway through which
medical students must pass to become licensed independent doctors. The government’s commitment
is embedded in the Medicare program, which in
2010 contributed $9.5 billion to teaching hospitals
in support of the training of some 100,000 residents, with few questions asked. In the future,
though, the financing of GME, the capacity of
the health care workforce, and the specialty mix
of physicians are likely to come under greater
scrutiny by Congress and the administration for
several compelling reasons.
The next test of whether Medicare’s support
of GME may be in jeopardy will occur in the
deliberations of a bipartisan panel of 12 members of Congress, called the Joint Select Committee on Deficit Reduction, which has been
charged with recommending ways to cut the
federal deficit by at least $1.2 trillion over the
next decade. If the panel reaches agreement by
a deadline of November 23, Congress would
consider the recommendations in an expedited
up-or-down vote by Christmas. If Congress rejects the package, government spending will
automatically be cut by $1.2 trillion over the
next 10 years, split between domestic and defense programs. In earlier high-level negotiations that at the last hour enabled President
Barack Obama to raise the government debt
ceiling, policymakers had discussed ways to
cut the federal deficit but could not reach
agreement. Among the ways identified was reducing Medicare’s support of GME, a recommendation made last December by the National Commission on Fiscal Responsibility and
Reform.1
1340
However, another factor that relates to Medicare and the training of the nation’s physician
workforce also figures into the equation. Once
President Obama signed the Affordable Care Act
(ACA) into law, the government, in essence, took
on a new obligation to ensure that the millions
of people who gain coverage in 2014 will have
access to adequate health care. This surge in
demand raises the question: Who will care for
these previously uninsured individuals if reductions in Medicare’s GME support should cut the
capacity of programs to train new physicians?
In this report, I will briefly describe the recommendation of the national commission (appointed by President Obama to “reduce excess
payments to hospitals for medical education”)
that has served as the basis for budget-deficit
discussions to cut these payments.1 I will take
stock of other workforce issues that apply to
doctors, including current estimates of physician
shortages and the absence of a consensus on
how many physicians are enough, provisions in
the ACA to expand the number of primary care
practitioners, and implications of the payment
cap Congress imposed on Medicare’s GME support 14 years ago. I will also cite the 16 new
allopathic and osteopathic medical schools that
either have opened or soon will open (with another dozen or so in earlier stages of development) and report opinions of health care leaders
who assert that state laws restricting advanced
practice nurses from rendering care up to their
level of training should be reconsidered, particularly when physicians are in short supply.
Recommendation of the
B owle s – Simp son Commission
Last December, the national commission cochaired
by Erskine Bowles, chief of staff to President Clinton, and former Republican Senator Alan Simpson
of Wyoming, issued its report calling for a re-
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health policy report
duction in the federal deficit of $4 trillion over
the next decade.1 The commission, which included 14 senior Democratic and Republican congressional leaders, voted 11 to 7 in favor of its recommendations but fell short of the 14 votes necessary
to send them to the House and Senate for an up
or down vote. One of its many recommendations
called for bringing Medicare’s GME payments “in
line with the costs of medical education by limiting hospitals’ direct GME payments to 120% of
the national average salary paid to residents in
2010.” Furthermore, the commission said that the
“add-on payments” (totaling about $6 billion a year)
that Medicare makes to teaching hospitals for their
indirect medical education expenses should be reduced; these payments are based on the number of
residents the hospitals employ. For every 10 residents per 100 beds, a teaching hospital receives
a 5.5% add-on adjustment to its Medicare payment rate for hospital care. By reducing it to 2.2%,
which the Medicare Payment Advisory Commission had estimated would more accurately reflect
indirect costs, the Bowles–Simpson commission
said Medicare’s reduced GME support would cut
federal expenditures by $6 billion by 2015 and
by $60 billion by 2020.2
Rep or t s of Physician Shor tage s
With time running out on the date (August 2)
Treasury Department officials warned that the
government would run out of money to meet its
financial obligations, 63 Democrats and 1 Republican (Rep. Patrick Meehan of Pennsylvania)
wrote in a letter to House and Senate leaders that
“rumors abound on possible [GME] cuts.”3 They
emphasized that the GME cuts that were being
discussed “would have a profoundly negative
impact” on medical training programs at a
time when the United States is “on the cusp of a
crisis in access to both specialty and primary
care physicians due to a growing physician
workforce shortage.” This urgent plea contrasts
with the little attention that government has
paid in recent years to the capacity of the nation’s health care workforce, despite warning
signs contained in an array of government and
private-sector reports that physician shortages
either already exist or soon will exist in particular geographic areas and in a growing number
of specialties.
Virtually all these reports were issued before
the enactment of the ACA, which is certain to
accelerate demand for more health care. The Association of American Medical Colleges is projecting a physician shortage of 62,900 doctors,
including 29,800 in primary care, by 2015. The
association also estimates that the shortage will
be more than twice that number (130,600) by
2025,4 as the population grows and ages, as doctors retire at a rate similar to that of new entries,
and as lifestyle priorities crimp physician productivity and advances in medical innovation.
In addition to the association’s national forecast, 62 other reports that have been issued in
the past decade by state governments, universities, medical societies, and private foundations
have also identified physician shortages in underserved areas and in many specialties.5 There
are skeptics who maintain that unless physicians
are steered through incentives to practice in areas
in which doctors are scarce, many will continue
to settle in attractive locales where “supply is already highest.”6,7 Moreover, Dr. David Goodman,
a Dartmouth Medical School pediatrician and researcher, added in testimony before the Senate
Finance Committee that an increased supply of
physicians is not reliably associated with better
health outcomes, quality of care, or satisfaction
for patients. To avoid getting caught up in the
debate over the precise dimensions of a physician shortage, a foundation report that was authored by academic medical leaders simply recommended a goal of “maintaining the current
ratio of approximately 250 doctors for every
100,000 people.”8
Congre ssional Fo cus on
Primary C are Shor tage s
During the ACA debate, Congress ignored estimates of physician shortages in various specialties and instead took incremental steps to address the dwindling interest among medical
school graduates in primary care. The Association of American Medical Colleges estimated that
between 2000 and 2009, the number of U.S. medical school graduates who are likely to become primary care doctors fell by 31%.9 One recent forecast estimated that by 2019, between 4307 and
6940 additional primary care doctors would be
needed to care for newly insured patients10; a
second report placed the number between 6400
and 7400.11 In 2010, there were about 205,000 generalist physicians (general and family practice,
general internal medicine, general pediatrics,
n engl j med 365;14 nejm.org october 6, 2011
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1341
The
n e w e ng l a n d j o u r na l
and geriatrics) who were active in patient care
(Dall T: personal communication). The ACA directs Medicare to pay a 10% bonus for 5 years
(2011–2015) under the program’s fee schedule to
all family physicians, internists, geriatricians, nurse
practitioners, and physician assistants who provide
60% of their services in qualifying evaluation and
management codes. A similar bonus was provided
to general surgeons, but to earn it they must practice in a medically underserved area. The law also
requires states to increase Medicaid payment rates
to Medicare levels in 2013 and 2014 for providers
who deliver certain primary care services. A primary care researcher, Dr. Robert Phillips, characterized the changes as appreciated but “a small
reversal of fortunes compared to the much larger shift to other specialties” as a result of Medicare’s fee schedule.12 The ACA and the economic
stimulus program tripled the field strength of the
National Health Service Corps, infusing it with
$1.8 billion over the next 5 years. The corps provides scholarships and loans to practitioners in
return for a minimum 2-year commitment to provide primary care in underserved communities.
Other provisions of the ACA created a National
Health Care Workforce Commission, charging it
with informing Congress on workforce trends, as
well as a National Center for Health Workforce
Analysis (which is housed in the Health Resources
and Services Administration) and state health care
workforce development grants to expand data collection and research. The Government Accountability Office appointed the commission’s 15 members and named as its chairman Peter Buerhaus,
a professor of nursing at Vanderbilt University.13
Five of the 15 commissioners are physicians. Given
the strong Republican opposition to the ACA,
advocates of the new commission have been unable to secure an appropriation of $3 million to
launch its operations. Thus far, the commission’s
activity has been limited to one conference call.
Implic ations of Medic are ’s
GME Payment C ap
In 1997, six major medical organizations declared in a consensus statement that the United
States was on the verge of a serious oversupply
of physicians. As a consequence, they said, the
number of entry-level GME positions should be
more closely aligned with the number of graduates
1342
of
m e dic i n e
of U.S. medical schools, and “this realignment
should be achieved primarily by limiting federal
funding of GME positions.”14 Congress, with virtually no objection from legislators, placed a payment cap on how much support Medicare could
provide to GME programs. With the payment cap
still in place 14 years later, fast-forward to the reform debate, in which senior Democrats, pressed
by academic medicine, proposed to lift the cap
and expand the number of Medicare-funded GME
positions by 15% (to 115,000). To the dismay of
other medical organizations, the American Academy of Family Physicians opposed the amendment,
asserting that additional GME posts should be
filled by trainees who planned careers in primary
care. Congress declined to increase Medicare’s
support for GME, agreeing only to redistribute
about 900 unused but authorized GME slots. The
law stipulates that most of these positions should
be used to train practitioners in primary care and
general surgery.
Because of the cap on Medicare’s payments,
the expanding number of U.S. medical school
graduates, and the continuing influx of some
7000 international medical graduates in search
of GME posts every year, before long there will
be too few positions to train them all. Currently,
about 25% of practicing physicians in the United
States are graduates of international medical
schools. The slow growth in GME positions —
an annual rate of 0.9% over the past decade
(Nasca T: personal communication) — contrasts
with the increases in enrollment that have occurred
in 100 of the 125 allopathic medical schools and
a doubling of enrollments in osteopathic medical
schools. By 2015, combined first-year enrollment
in allopathic and osteopathic schools is projected
to reach 26,403, an increase of 35% over 2002
numbers. Eight new allopathic schools and nine
osteopathic schools or branch campuses have
enrolled their first classes or soon will do so
(for details, see Table 1 in the Supplementary Appendix, available with the full text of this article
at NEJM.org).
In an interview, Dr. Thomas Nasca, CEO of the
Accreditation Council for Graduate Medical Education, expressed concern over the narrowing gap
between the number of entry-level GME posts
and the growing number of medical school graduates. Nasca said, “We estimate that we will see
domestic production of medical school graduates
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Copyright © 2011 Massachusetts Medical Society. All rights reserved.
health policy report
30,000
Current rate
of increase
(0.9%/yr)
25,000
Flat at 2010
level
Reduction
(1%/yr)
20,000
15,000
10,000
5,000
Allopathic graduates
0
9
02
–2
19
8
01
–2
18
20
20
7
01
–2
20
17
6
01
–2
16
5
01
–2
15
20
20
4
01
–2
20
20
14
01
–2
3
Osteopathic graduates
13
2
01
12
–2
1
01
–2
11
20
20
0
01
–2
20
10
9
01
–2
09
8
00
–2
08
20
7
00
–2
07
20
20
6
00
–2
20
06
5
00
–2
05
4
00
–2
04
20
20
3
00
–2
20
03
00
00
–2
01
02
20
20
–2
2
0
International medical graduates
Figure 1. Actual and Projected Numbers of Medical School Graduates Entering Graduate Medical Education (GME)
Training Positions, as Compared with Three Scenarios of Available Positions (2001–2020).
Shown are the actual number of U.S. graduates from allopathic and osteopathic schools and international medical
graduates entering training programs approved by the Accreditation Council for Graduate Medical Education from
2001 through 2010, along with the projected numbers for 2011 through 2020. Projections in growth beyond 2010 for
allopathic and osteopathic graduates were provided by the Association of American Medical Colleges and the American Association of Colleges of Osteopathic Medicine. The projections for international medical graduates entering
training after 2011 assumed that numbers would remain constant. The three dashed lines show projected numbers
of GME positions for the period of 2011 through 2020 on the basis of three scenarios: continued growth at a rate of
0.9% per year, as observed from 2001 through 2010 (top line); no growth in the number of positions after 2010
(middle line); and a reduction of 1% per year (bottom line).
functionally surpass our current total number of
GME postgraduate year-one pipeline positions
[posts that lead to initial specialty certification]
by 2015 or sooner, and this does not include some
10,000 non–U.S.-citizen international medical
graduates and about 3700 U.S.-citizen international medical graduates who seek GME posts in
U.S. teaching hospitals.” Figure 1 shows three
scenarios that are based on assumptions regarding the availability of GME positions. The first
scenario assumes an annual increase of 0.883%
in the number of positions (the average annual
growth rate from 2001 through 2010). The second scenario assumes that GME positions will
hold constant at the 2010 level. The third sce-
nario assumes an annual decrease of 1% in the
number of GME positions in recognition of possible reductions in Medicare support. Nasca
added, “In the absence of congressional action to
lift the cap, or the unlikely prospect of securing
other sources of GME support, we face the risk
of graduating physicians in the United States who
will be unable to obtain the training required to
obtain a license to practice independently.”
Florida stands out as a state with four new
medical schools but very little activity under way
to increase its number of GME positions, despite
ranking 43rd in the number of these posts per
capita. In an interview, Dr. Michael Whitcomb,
a former senior vice president of the Association
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1343
The
n e w e ng l a n d j o u r na l
of
m e dic i n e
of American Medical Colleges, said that a number of factors have prevented Florida from expanding its GME capacity — financing being only one.
“Another is that of community hospitals with the
resources to create GME programs, very few are
interested in doing so, in part because their medical staffs prefer taking care of patients without
the added responsibility of teaching,” he said. In
New York State, a survey of nonteaching hospitals with at least 70 beds showed that 58.3%
were reluctant to develop GME programs with
or without new funding because of the challenges they present (Edelman N: personal communication).
Medicaid. In 2005, a total of 47 states provided
GME support of $3.78 billion through Medicaid.
By 2009, only 41 states were providing $3.18 billion in such support, and 9 additional states reported they were considering ending their payments to teaching hospitals.16 More recently,
Arizona’s legislature eliminated all of its Medicaid GME support, a step educators considered
“particularly vexing” because they had a strong
working relationship with the program’s administrators (Grossman M: personal communication). In addition, Florida and Washington State
cut GME funding provided through their Medicaid managed-care programs, Michigan reduced
its support for GME, and training support proProspec ts for Removing the GME Cap vided by Iowa, Missouri, and Rhode Island appeared to be in jeopardy.
Given the current concern over the federal deficit, the likelihood that Congress will remove the
Fu t ure R ole s of Nonphysicians
in Te am - B a sed C are
cap on Medicare’s GME support is nil. Indeed,
holding on to existing GME support may be the
best outcome medical educators can hope to Increased attention is being paid to the potential
achieve. Even before the budget discussions be- for expanding the roles of advanced practice
gan in earnest, the House voted 234 to 185 on nurses and physician assistants as first-contact
May 25 to eliminate $230 million in funding au- providers, given the length of training for physithorized by the ACA to support GME training of cians (3 to 7 years after medical school), the limprimary care physicians at community health itations in the growth of GME positions posed
centers. These facilities, referred to as “teaching by the Medicare funding cap, and the promotion
health centers,” represent the first major federal of team-based care by the ACA. Even Dr. Richard
effort to shift GME training to community-based Cooper, who has been an influential advocate
settings that emphasize primary care. The Senate for the training of many more physicians,17 emhas not acted on the House-passed bill.
phasized in an interview: “The delegation of tasks
The administration’s 2012 budget proposes to a broadened spectrum of caregivers in new
to eliminate a program that provides an annual models of care must also occur. I envision a reappropriation of $317 million to children’s hos- ordering of what services physicians, APNs [adpitals for the support of pediatric GME training. vanced practice nurses], and PAs [physician assisIgnoring the administration’s budget request, the tants] and other workers down the line will be
House Energy and Commerce Committee cast a expected to perform, although even then capacbipartisan voice vote on July 28 to extend the ity may run short.”18
pediatric GME program for 5 years. In its latest
In separate interviews, Health and Human Serset of options on ways to cut spending or raise vices Secretary Kathleen Sebelius and Dr. Bill Frist,
revenue, the Congressional Budget Office (CBO) former Senate majority leader from 2002 through
said that substantial savings could be achieved by 2007, urged examination of state laws that reconsolidating federal GME support into a grant strict the scope of practice of advanced practice
program for teaching hospitals. Through such a nurses. Sebelius said, “It’s hard for me to believe
consolidation, the CBO estimated that the govern- that Congress would preempt state law, but . . .
ment could derive savings of $25 billion between we could put some incentives on the table to
2012 and 2016 and roughly $69 billion over a dec- encourage that look.” Frist said: “To meet the
ade (2012–2021).15
explosive demand for primary health services
Some states also have begun to cut the sup- will require truly disruptive reform of how priport they provide to GME programs through mary care is delivered. Delivering primary care
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n engl j med 365;14 nejm.org october 6, 2011
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Copyright © 2011 Massachusetts Medical Society. All rights reserved.
health policy report
will not remain the sole purview of doctors.
There are not enough of them, and they are too
expensive. Expanding the scopes of practice of
PAs and advanced practice nurses simply has to
occur.” In a recent report issued by the Institute
of Medicine, the top recommendation was that
nurses be allowed to practice to the full extent
of their education and training.19
Dr. Darrell Kirch, CEO of the Association of
American Medical Colleges, emphasized in another interview that the ACA’s call for deliverysystem reform “will require us to take a new
view of how we educate and deploy health professionals in all disciplines. To implement more
effective delivery models, we need every health
care provider working at the top of their license
in high-performing teams. This creates an imperative for academic medical centers to respond
with new approaches to training, as well as research regarding which educational and care
models work best.”
The fits and starts of physician-workforce
policy in the United State have been on display
during the past several decades, with warnings
of shortages and surpluses at different times.
More than anything perhaps, such ambivalence
underscores the uncertainty among policymakers of what government’s legitimate role is in
setting a course that is flexible enough to account for the many variables that periodically
crop up. Medicare’s GME support escaped unscathed in the recent wrangling over the debt
ceiling, but it may well be a target again as the
new congressional deficit-cutting committee
identifies ways to reduce the federal deficit by
$1.2 trillion over the next decade. Of its 12
members, Senator John Kerry (D-MA) has been
the most outspoken advocate of maintaining
Medicare’s current level of GME support. Defending that position against the competing
claims for the federal dollar of an array of other
stakeholders may prove a tall order in the quest
for deficit reduction.
Disclosure forms provided by the author are available with the
full text of this article at NEJM.org.
Mr. Iglehart is a national correspondent for the Journal.
This article (10.1056/NEJMhpr1107519) was published on September 7, 2011, at NEJM.org.
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The New England Journal of Medicine
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Copyright © 2011 Massachusetts Medical Society. All rights reserved.
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