CMS to redistribute vacant resident positions

The slots are being reallocated for the first time since the Balanced Budget Act of 1997 took effect.

By Myrle Croasdale — Posted May 9, 2005

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The government is redistributing a small -- yet significant -- portion of the federal money used to sustain residency programs by offering up unused slots to programs that need them.

It's proved to be popular with hospitals, with more than 530 institutions requesting a total of 4,600 resident positions, according to the Centers for Medicare & Medicaid Services.

That makes the requests potentially more than double the number of residency positions that are likely to become available.

At press time, CMS, the agency reassigning the unused residency positions, was still unclear on exactly how many open slots there were. But an Assn. of American Medical Colleges survey conducted last year estimated 2,000 to 3,000 resident positions were unused.

CMS expects to contact individual hospitals in writing in late May or June to let them know whether they will receive extra money to pay for additional residency positions. The government will pay hospitals at half the rate it now pays for current resident positions.

Hospitals can apply for money from the unused residency slots if they are starting a new residency program, expanding an existing one or exceeding their current allocation of government-supported slots. CMS said it would give rural hospitals top priority. Hospitals in small urban areas with less than 1 million people would be next in line. Large urban hospitals were last on the list.

Since hospitals hire new residents in March for the academic year that starts July 1, they've already made commitments for the year without the benefit of knowing if additional money would be available.

If hospitals capture any of the extra funds, it will be a bonus to help offset existing resident costs, medical educators said, or leave the program scrambling to fill a newly funded position.

The redistribution was made possible by the 2003 Medicare Prescription Drug Improvement and Modernization Act, which mandated that unused residency slots be reallocated.

This marks the first time the redistribution will take place since the Balanced Budget Act of 1997 capped the number of residency positions eligible for payments from Medicare at 1996 levels. While hospitals have been able to train more residents if they chose to, they didn't get additional Medicare dollars for the positions as they did before 1997. Since the payment cap took effect, the total number of residents has held steady at about 98,000 slots.

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