July 1997 Bulletin

42 N.Y. state hospitals reducing residency slots

A major initiative in reducing the number of residents being trained in New York state hospitals gets underway this month. The graduate medical education demonstration project is expected to reduce over five years the number of training positions in 42 New York State teaching hospitals by 20 to 25 percent. That's about 2,000 slots of the more than 10,200 slots in the hospitals. During the same period, the hospitals will increase the proportion of primary care residents by 20 percent.

The hospitals will receive $400 million in declining levels of Medicare payments to pay for the slots. The money will enable the participating hospitals to hire doctors, nurses, physician assistants and other personnel for duties that were performed by residents.

The program will result in a savings of $300 million for Medicare because the agency would have given the hospitals an estimated $700 million in graduate medical education payments to train the 2,000 residents.

The program was announced by HCFA in February and greeted by "wild swings in criticism, questions and applause," Harold Dick, MD, professor and chairman, department of orthopaedic surgery, Columbia-Presbyterian Medical Center, told the National OrthopaedicLeadership Conference in April. The comments have been mixed despite the fact that "with the advent of managed care it is clear that the number of subspecialists is too numerous to be produced at the same rates as they have during the last two decades," Dr. Dick said.

There are more than 200 hospitals in New York state and about 150 have resident training. The 42 hospitals in the program represent two-thirds of all the residents being trained in the state.

Many hospitals were eager to use the program to redefine their mission and to "tighten up the educational component of their program," said Patricia J. Wang, senior vice president, health finance and managed care, of the Greater New York State Hospital Association, which developed the plan. Because of managed care, the growing emphasis on ambulatory care and mergers, hospitals want to downsize their programs to decrease costs and increase their viability in the market. New York state ended its regulation of hospital fees this year, putting the hospitals in a free market environment.

To ensure the quality of care is not diminished as the number of residents are reduced, Wang said, hospitals will use salaried physicians and other qualified personnel, team model concepts and will increase operating efficiencies.

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