WASHINGTON — In a highly unorthodox initiative aimed at alleviating a growing glut of physicians, the federal government has agreed to pay hospitals around the country hundreds of millions of dollars not to train doctors.
The initiative, embedded in the federal budget agreement, extends to all 1,025 of the nation's teaching hospitals an offer similar to a controversial experiment approved for New York earlier this year.
That experiment, which will pay hospitals in that state $400 million over the next several years while they gradually decrease the number of young doctors they train, drew an outcry from teaching hospitals elsewhere that felt New York had wangled a lucrative special deal.
Congressional Republicans decided that, instead of trying to block the money for New York, they would expand the opportunity nationwide.
Since it began, Medicare has underwritten residency training programs heavily and has, in effect, made residents a prized, inexpensive kind of labor for their hospitals. Taxpayers spend $7 billion a year on such training.
Now, hospitals that downsize will not get extra money outright. But if they volunteer to reduce their residency programs by 20% or 25% over five years, Medicare will cushion the financial blow. For the first two years, it will pay the whole subsidy for the missing residents. After that, the payments will taper off for three years.
The agreement also for the first time essentially forbids hospitals to increase the sizes of their residency programs.