Medical Education and Research Costs (MERC)
2001 Trust Fund Distribution
The MERC Fund was established in 1996 to provide funding for the clinical training of selected medical
professions. The purpose of this funding is to compensate teaching facilities for a portion of the costs of
clinical training provided in patient care settings. Historically, teaching institutions covered a portion of
these costs by setting patient charges above what they would be in a non-teaching environment. However,
health plans are increasingly unwilling to pay this teaching increment, leaving teaching facilities at a competitive disadvantage. With the shift away from inpatient care and reductions in Medicare funding of medical education, teaching facilities are finding it more difficult to fund the costs of clinical training.
$5,000,000 General Revenue Fund
$8,411,466 Tobacco Endowment
$13,713,642 Federal Match
$27,125,108 Total 2001 Fund
In response to these financial pressures, the MERC Fund has distributed grants to clinical training sites since 1998. Over the past
four years, the MERC Fund has distributed $80.5 million to clinical training sites around the state. In 2001, MERC distributed
approximately $27.1 million, comprised of $5 million from the
general fund, $8.4 million from the tobacco settlement fund
established by the 1999 Legislature, and $13.7 million in federal
Medicaid matching funds.
In addition to these funding sources, additional funds for distribution come from the carveout of the medical education component of Medicaid capitation rates paid to HMOs and the transfer of these funds to
MERC. Federal approval for this carveout was received in August of 2000, with the first removal and transfer of funds on October 1, 2000. The first distribution of these funds occurred in June of 2001, and will
occur biannually.
2001 MERC Fund Distribution
Applications for grants from the MERC Fund are submitted by sponsoring
institutions (organizations that are financially or organizationally responsible for one or more teaching programs) on behalf of the programs they
sponsor. Each teaching program uses clinical training sites to provide training to the provider types listed to the right. Since the MERC grants are
designed to offset costs at clinical training sites, not at sponsoring institutions, the sponsoring institutions are obligated to forward the grants on to
the clinics or hospitals at which their students’ or residents’ training was
provided. A facility may be both a sponsoring institution and a training
site. Training sites often support trainees from multiple sponsoring institutions and programs. Currently, nine provider types (listed at right) are eligible for MERC grants.
1
Provider types eligible for grants
from the 2001 MERC Fund
Advanced Practice Nurses
Chiropractic Students
Dental Residents
Dental Students
Medical Residents
Medical Students
PharmD Residents
PharmD Students
Physician Assistants
In 2001, the MERC Fund distributed grants to 18 sponsoring institutions representing 149 training programs, over 450 training sites, and 2,790 trainees. The table below shows a breakdown of the 2001 distribution by sponsoring institution.
MERC 2001 Distribution
Number of
Programs
Sponsoring Institution
ABBOTT NORTHWESTERN HOSPITAL
AUGSBURG COLLEGE
COLLEGE OF ST. CATHERINE
COLLEGE OF ST. SCHOLASTICA
DULUTH GRADUATE MEDICAL EDUCATION COUNCIL
HENNEPIN COUNTY MEDICAL CENTER
MAYO FOUNDATION
MERCY HOSPITAL
MINNEAPOLIS SPORTS MEDICINE CENTER
MINNESOTA STATE UNIVERSITY, MANKATO
NORTHWESTERN HEALTH SCIENCES UNIVERSITY
REGIONS HOSPITAL
ST. MARY'S UNIVERSITY OF MINNESOTA
UNITED HOSPITAL
UNITED HOSPITAL AND CHILDREN'S HEALTHCARE
UNIVERSITY OF MINNESOTA ACADEMIC HEALTH CENTER
WINONA STATE UNIVERSITY
WOMEN'S HEALTHCARE
Total
2
1
1
2
1
9
59
1
1
1
1
6
1
1
2
57
2
1
149
Eligible
FTEs
28.04
29.8
22.125
29.045
29
218.54
865.506
1.43
2.4
6.392
74.57
80.77
38
16.474
1.6
1323.44
14.95
7.64
2789.722
Total
Grant
$376,199.19
$79,963.26
$59,916.84
$78,656.83
$396,667.63
$2,961,883.53
$10,632,669.19
$19,559.62
$32,827.67
$17,310.20
$118,424.21
$1,104,787.75
$102,907.85
$225,334.59
$9,124.43
$10,847,699.31
$40,486.13
$20,689.91
$27,125,108.34
% of
Trust Fund
1.3869%
0.2948%
0.2209%
0.2900%
1.4624%
10.9193%
39.1986%
0.0721%
0.1210%
0.0638%
0.4366%
4.0729%
0.3794%
0.8307%
0.0336%
39.9914%
0.1493%
0.0763%
100.0000%
Distribution of MERC funds is governed by a formula that first calculates average clinical training costs per
trainee for each provider type, then uses that figure to calculate a total cost for training eligible FTEs at
each training site. A set percentage of costs is reimbursed for each site.
2
Distribution by Provider Type
Programs training medical residents accounted for 74% of the programs and 61% of the FTEs in 2001.
The FTEs were over three times higher than the FTEs of next largest provider type. Consistent with previous years, the bar chart below indicates medical resident programs also have the highest average costs per
trainee which were in access of $156,000. Therefore, medical residents received 85% of the MERC Fund
distribution in 2001.
2001 MERC Grant Distribution by Provider Type
Provider Type
Advanced Practice Nurses
Chiropractic Students
Dental Residents
Dental Students
Medical Residents
Medical Students
PharmD Residents
PharmD Students
Physician Assistants
Overall Total
# of Programs # of Sites Eligible FTEs Grant Amount % of Trust Fund
11
284
212.618
$575,791.22
2.12272%
1
40
74.57
$118,424.21
0.43659%
12
20
71.99
$828,860.48
3.05569%
1
1
110.76
$930,235.37
3.42943%
111
425
1691.844 $23,141,370.65
85.31347%
5
221
545.92 $1,270,742.25
4.68475%
6
13
12.24
$69,801.83
0.25733%
1
37
39.98
$109,919.07
0.40523%
1
54
29.8
$79,963.26
0.29479%
100.00000%
149
1095
2789.722 $27,125,108.34
Average Cost of Clinical Training by Provider Type
Distribution of 2001 MERC Trust Fund by Provider Type
$180,000
Physician
Assistants
PharmD Students 0.2948%
0.4052%
Advanced Practice
Nurses
Chiropractic
2.1227%
Students
0.4366%
PharmD Residents
0.2573%
$156,015
$160,000
$131,325
$140,000
Dental Residents
3.0557%
$120,000
$95,796
$100,000
Medical Students
4.6847%
Dental Students
3.4294%
$80,000
$65,046
$60,000
$30,889
$31,359
$40,000
$30,606
$26,550
$20,000
$18,114
$0
Advanced Dental Dental Chiropractic Medical Medical Pharm. D. Pharm. D. Physician
Practice Residents Students Students Residents Students Residents Students Assistant
Nurse
(DR)
(DS)
(CS)
(MR)
(MS)
(PDR)
(PDS)
(PA)
(APN)
Medical Residents
85.3135%
Three Year Average
3
Distribution by County
In a breakdown of the distribution by county, the
results coincide with the counties of the major
teaching institutions. Hennepin County receiving
43% of the 2001 distribution is home to many
teaching facilities (i.e., Hennepin County Medical
Center, University of Minnesota, Abbott
Northwestern Hospital, etc.,). Olmsted County
received 39%. This is attributed to Mayo Hospital
and Clinic. These two counties alone received
82% of the total grant.
St. Louis
$553,323.03
2%
All Others
$792,266.70
3%
Ramsey
$3,739,572.56
14%
Hennepin
$11,478,362.22
42%
Olmsted
$10,561,674.83
39%
Distribution by Setting
The training sites used by MERC funded programs
range from large inpatient facilities to smaller, one
Inpatient
or two physician community based clinics or group
$10,050,216.90
practices. The MERC Fund Application collects
37%
information on the type of clinical setting at which
trainees are located (i.e., inpatient, ambulatory, or a
combination of the two). The 2001 MERC distribution is split relatively even among these three settings, with inpatient facilities receiving the highest
percentage of funds (37%) and ambulatory sites the
lowest (27%).
Ambulatory
$7,283,481.81
27%
Both
$9,791,409.63
36%
4
Distribution by Site
The table below lists the training sites that received $10,000 or more from the 2001 MERC Fund. Many
of these facilities are training sites for multiple teaching programs; the table sums the grants that each site
received from all training programs.
MERC 2001 Grant Distribution by Site
Sites with Grants >$10,000
Site Name
ST MARY'S HOSPITAL
FAIRVIEW UNIVERSITY MEDICAL CENTER
HENNEPIN COUNTY MEDICAL CENTER
MAYO CLINIC
REGIONS HOSPITAL
ROCHESTER METHODIST HOSPITAL
UNIVERSITY OF MN SCHOOL OF DENTISTRY
ABBOTT NORTHWESTERN HOSPITAL
CHILDRENS HOSPITALS AND CLINICS ST. PAUL
NORTH MEMORIAL MEDICAL CENTER
METHODIST HOSPITAL, INSTITUTE FOR RESEARCH AND EDUCATION
MAYO PSYCHIATRY AND PSYCHOLOGY TREATMENT CENTER
HEALTHEAST ST. JOSEPH'S HOSPITAL
HEALTHEAST ST. JOHNS HOSPITAL
ST. LUKE'S HOSPITAL
SAINT MARYS MEDICAL CENTER
CHILDRENS HOSPITALS AND CLINICS MINNEAPOLIS
UNITED HOSPITAL INC
UAFP SMILEY'S CLINIC
UAFP BETHESDA CLINIC
DULUTH FAMILY PRACTICE CENTER
PARK NICOLLET CLINIC ST LOUIS PK
UAFP NORTH MEMORIAL CLINIC
UAFP PHALEN VILLAGE
CREEKSIDE FAMILY PHYSICIANS
GILLETTE CHILDRENS HOSPITAL
UNITED FAMILY HEALTH CENTER
WASECA MEDICAL CENTER-MAYO HEALTH
DULUTH CLINIC
COMMUNITY UNIVERSITY HEALTH CARE CENTER
HEALTHPARTNERS COMO
ST. CLOUD HOSPITAL
NORTHWESTERN COLLEGE OF CHIROPRACTIC CLINIC BLOOMINGTON
CENTRACARE CLINIC
MANKATO CLINIC, LTD
MERCY HOSPITAL
HEALTHPARTNERS BLOOMINGTON
HEALTHPARTNERS RIVERSIDE
IMMANUEL ST. JOSEPH'S HOSPITAL
STAR CLINIC
NORTHWESTERN COLLEGE OF CHIROPRACTIC CLINIC ST. PAUL
UNITY HOSPITAL
CAMBRIDGE MEMORIAL HOSPITAL
ANOKA METRO RTC
FAIRVIEW SOUTHDALE HOSPITAL
WEST SIDE COMMUNITY HEALTH SERVICES
HEALTHEAST BETHESDA HOSPITAL
ASPEN MEDICAL GROUP 1020 BANDANA
MILLER DWAN MEDICAL CENTER
NORTHWESTERN COLLEGE OF CHIROPRACTIC CLINIC BURNSVILLE
HEALTHPARTNERS ST. PAUL
PEDIATRIC SURGEONS CHC
SURGICAL CONSULTANTS, PA
PARK NICOLLET CLINIC MINNEAPOLIS
RIDGEVIEW PHARMACY
HEALTHPARTNERS MAPLEWOOD
AUSTIN MEDICAL CENTER
AFFILIATED MEDICAL CENTERS PA
ST. CLOUD MEDICAL GROUP
MT. ROYAL MEDICAL CENTER
5
City
Rochester
Minneapolis
Minneapolis
Rochester
St. Paul
Rochester
Minneapolis
Minneapolis
St. Paul
Robbinsdale
St. Louis Park
Rochester
St. Paul
Maplewood
Duluth
Duluth
Minneapolis
St. Paul
Minneapolis
St. Paul
Duluth
St. Louis Park
Minneapolis
St. Paul
St. Louis Park
St. Paul
St. Paul
Waseca
Duluth
Minneapolis
St. Paul
St. Cloud
Bloomington
St. Cloud
Mankato
Coon Rapids
Bloomington
Minneapolis
Mankato
Minneapolis
St. Paul
Minneapolis
Cambridge
Anoka
Minneapolis
St. Paul
St. Paul
West St. Paul
Duluth
Burnsville
St. Paul
Edina
Edina
Minneapolis
Chaska
Maplewood
Austin
Willmar
St. Cloud
Duluth
Eligible FTEs % of Trust Fund Grant Amount
393.7400
17.4579% $4,735,473.63
377.8000
14.4846% $3,928,950.59
373.8430
14.4256% $3,912,950.50
299.4760
13.7657% $3,733,958.94
221.6900
8.4237% $2,284,929.34
157.8900
6.9327% $1,880,493.54
153.8300
5.2576% $1,426,123.98
69.0600
2.1682%
$588,116.75
39.1540
1.2740%
$345,574.19
33.1800
1.1557%
$313,475.32
24.8600
0.9246%
$250,796.02
17.3900
0.7514%
$203,812.33
16.9600
0.7297%
$197,930.71
16.1680
0.6557%
$177,856.31
13.7100
0.5817%
$157,789.18
11.7700
0.5625%
$152,577.14
23.4000
0.5516%
$149,609.94
13.2180
0.5304%
$143,880.84
11.6300
0.4986%
$135,241.38
11.2800
0.4702%
$127,535.33
19.7500
0.4206%
$114,075.14
13.4360
0.4170%
$113,102.27
9.1100
0.3821%
$103,647.99
7.3800
0.3345%
$90,729.64
7.5300
0.3119%
$84,609.63
6.5900
0.2793%
$75,764.05
4.7810
0.2411%
$65,395.45
4.7700
0.2397%
$65,017.97
27.0800
0.2394%
$64,934.36
6.7100
0.1540%
$41,769.22
3.5900
0.1517%
$41,159.99
4.7200
0.1316%
$35,709.73
20.4600
0.1198%
$32,492.41
3.0000
0.1137%
$30,832.39
3.3420
0.1118%
$30,332.46
4.8610
0.0964%
$26,148.97
3.6300
0.0912%
$24,739.68
1.9500
0.0845%
$22,926.82
2.6600
0.0799%
$21,684.08
1.4600
0.0736%
$19,970.16
12.2500
0.0717%
$19,454.16
3.0020
0.0705%
$19,121.75
1.3480
0.0680%
$18,438.20
5.1000
0.0647%
$17,546.56
1.7800
0.0639%
$17,323.07
1.3900
0.0615%
$16,671.27
2.3300
0.0556%
$15,080.24
3.9800
0.0547%
$14,830.30
1.4200
0.0546%
$14,815.59
9.0100
0.0528%
$14,308.73
1.8200
0.0511%
$13,849.94
1.0000
0.0504%
$13,678.19
1.0000
0.0504%
$13,678.19
2.6900
0.0446%
$12,100.35
2.0000
0.0420%
$11,405.53
1.3400
0.0419%
$11,367.56
1.4590
0.0416%
$11,293.47
4.2700
0.0416%
$11,278.30
1.1200
0.0403%
$10,921.63
$10,651.65
4.4600
0.0393%
MERC Fund Distribution, 1998 - 2001
•
In 2001, cost data was not required for programs, with the exception of Chiropractors. By statue,
new provider types must have three year’s of cost data to begin reporting in the biennium years
only. Chiropractors were in their second year of the Fund during the 2001 application period.
•
The number of teaching programs covered by MERC remains fairly consistent with a slight 3%
decrease from the time the MERC Fund began in 1998.
•
The eligible FTEs continue to increase at a rate of 2% to 2.5% per year as indicated by the table
below (with the exception of 1999 where there was a slight decrease in the number of eligible
FTEs). This increase is not necessarily evidence of a change in available training program slots, but
is more likely due to an increased awareness of the MERC program. Also contributing to this in
2001, cost data was not required (expect for Chiropractors), making the application process less
cumbersome. There was also an additional sponsoring institution, Mercy Hospital.
Teaching Program & Eligible FTE Comparison
Application Year
1998
1999
2000
2001
Teaching Programs
154
158
153
149
Eligible FTEs
2,710
2,663
2,723
2,789
•
The number of training sites who receive funding from the MERC Fund has increased from roughly 325 to over 450 in four years. In part, this increase is due to the addition of chiropractors as an
eligible provider type. The largest growth, however, is likely due to increased familiarity with the
MERC program over time. As program directors have become more efficient in gathering required
data from training sites and changes simplifying the application have been made, more sites - and
smaller sites - are able to be included in applications.
•
The table below lists the MERC Fund distributions by provider type. The Chiropractic program
did not apply for the Fund until 2000; therefore, only two years are listed. The Medical Residents
have consistently received the highest distribution of funds due to higher costs, number of FTEs,
and number of teaching programs.
Distribution by Provider Type Comparison
Provider Type
Advanced Practice Nurses
Chiropractic Students
Dental Residents
Dental Students
Medical Residents
Medical Students
PharmD Residents
PharmD Students
Physician Assistants
Overall Total
1998
$199,899
1999
$241,518
$610,032
$668,771
$15,435,778
$710,958
$58,255
$37,649
$38,791
$17,760,133
$523,667
$670,241
$17,839,758
$1,196,043
$40,943
$69,979
$36,408
$20,618,557
6
2000
2001
$472,258
$575,791
$40,185
$118,424
$398,009
$828,860
$465,463
$930,235
$12,889,456 $23,141,371
$600,114
$1,270,742
$47,636
$69,802
$47,768
$109,919
$40,457
$79,963
$15,001,346 $27,125,108
Total
$1,489,466
$158,609
$2,360,568
$2,734,710
$69,306,363
$3,777,857
$216,636
$265,315
$195,619
$80,505,144
% of Funds
1.85%
0.20%
2.93%
3.40%
86.09%
4.69%
0.27%
0.33%
0.24%
100.00%