Health Headlines January 13, 2025

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Congress Considering Bipartisan Legislation to Expand Medicare GME Programs—

On December 18, 2024, a bipartisan group of four Senators on the Senate Finance Committee released draft legislation that would expand the total number of Medicare Graduate Medical Education (GME) full-time equivalent (FTE) resident slots by 5,000 between 2027 and 2031. If passed, this number of GME FTE resident slots would be five times larger than the ongoing Medicare GME FTE resident slot expansion that began under the 2021 Consolidated Appropriations Act, which increases the total number of GME FTE resident slots by 1,000 between 2023 and 2027. The Senators are requesting feedback on the draft legislation by January 31, 2025.

The Medicare GME program provides enhanced Medicare payments for certain teaching hospitals that train physicians.  Under the Medicare GME program, Medicare finances a portion of participating teaching hospitals’ direct and indirect costs for maintaining residency training programs for a fixed number of FTE resident slots.

In its current form, this legislation would cap the number of new FTE GME resident slots that participating teaching hospitals can receive at thirty and would require that these slots be used only for existing GME programs. The legislation would also require that the teaching hospitals agree to expand these GME programs. The legislation would specifically set aside ten percent of the FTE GME resident slots for hospitals that meet one of five of the following criteria:

• The hospital is located in a rural area (excluding urban hospitals that reclassify as rural under section 1886(d)(8)(E) of the Social Security Act);
• The hospital is located in an area with a rural-urban commuting code equal to or greater than 4.0;
• The hospital is a sole community hospital;
• The hospital is located within ten miles of a sole community hospital; or
• For FY 2031, the hospital has an accredited rural training track. 

Also, the legislation would prioritize specific GME training programs.  Specifically, the legislation would require that at least fifteen percent of the FTE GME resident slots be used for psychiatry or psychiatric subspecialty GME programs and that at least twenty-five percent of the slots be used for primary care GME programs. In addition, the legislation would require the establishment of a Graduate Medical Education Policy Council, which would advise the Secretary in and after 2031 on allocation of the 5,000 FTE GME slots provided for by the legislation across disciplines every five years going forward.

The Senators who authored the draft legislation, Senators Catherine Cortez Masto (D-Nev.), Bill Cassidy (R-La.), Michael Bennet (D-Colo.), and John Cornyn (R-Texas), are requesting feedback from stakeholders on the following five different questions by January 31, 2025:

1. “Is the 30-slot cap appropriate for ensuring fair distribution of residency slots across hospitals? What other strategies could Congress consider to ensure hospitals in all regions have an equal opportunity to compete for slots?”
2. “Is codifying remote supervision the best way to provide flexibility to rural hospitals, or are there alternative approaches Congress should consider?”
3. “Are the proposed data categories in Section 7 [of the draft legislation] sufficient for understanding the GME landscape without overburdening small hospitals? Are there other useful data points or reporting methods that should be included?”
4. “Is creating a GME Policy Council the right approach to guiding future GME slot allocations? Is the scope and responsibility of the Council adequate to make it effective?”
5. “Are there any categories of high-need hospitals with potentially higher GME costs that are not already captured in the bonus rates for the proposed standardization of PRA for new slots?”

Senator Cortez Masto's (D.-Nev) announcement of the draft legislation can be found here. The draft itself can be found here. Finally, a summary of the draft by its authors can be found here.

Reporter, Gregory Fantin, Washington D.C., +1 202-626-9271, GFantin@kslaw.com.

Editors: Chris Kenny and Kate Stern

Issue Editors: Elizabeth Key and Dennis Mkrtchian