Training Physicians: Medicare support provides vital funding to train our doctors and maintain patient access.

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1 GRADUATE MEDICAL EDUCATION Training Physicians: Medicare support provides vital funding to train our doctors and maintain patient access. GRADUATE MEDICAL EDUCATION

2 California faces a shortfall of up to 17,000 physicians by 2015.

3 DON T CUT FUNDS THAT SUPPORT PHYSICIAN TRAINING. California needs more doctors. The state already faces a physician shortage and it will grow to as many as 17,000 doctors by The demand for doctors will only increase as the population ages and more people become insured through federal health reform. The physician work force is aging. California has the largest percentage of physicians (30 percent) who are over age 60 and ready to retire in the next few years. The University of California plays a critical role in training physicians. UC trains more than 3,100 medical students, nearly half of the state s total. UC also trains more than 4,400 medical residents and fellows, nearly half of the state s total. A cut in federal funding for training physicians would have a devastating impact on the health of California and the nation. The president s National Commission on Fiscal Responsibility and Reform ( deficit commission ) proposed a $60 billion cut over 10 years in Medicare support for graduate medical education. If Congress supports the deficit commission s GME recommendations, UC would lose an estimated $900 million over 10 years. This action would threaten patient access to care by shrinking UC s physicians training programs and endangering access to critical services such as trauma or cancer care that many patients may someday need.

4 WHAT IS GRADUATE MEDICAL EDUCATION (GME)? GME is the second phase of the formal educational process that prepares doctors for medical practice. It typically takes at least 11 years beyond high school to educate physicians before they will practice independently four years for a bachelor s degree, four years for medical school and three to seven years for residency (GME). Medical residents train at teaching hospitals such as UC academic medical centers, where they receive supervised, hands-on training in clinical specialties such as pediatrics or surgery. A residency can be followed by a fellowship, during which time a physician receives subspecialty training. WHY IS GME PART OF THE MEDICARE PROGRAM? Since its inception, the federal Medicare health insurance program has provided funds to help teaching hospitals cover a portion (Medicare s share ) of the higher costs associated with their unique patient care, education and research missions. Medicare is the largest source for GME funding. Direct payments compensate teaching hospitals for part of the costs related to salaries and benefits for residents, teaching physician time, overhead and administrative activities. Indirect payments recognize Medicare s share of the higher indirect costs associated with patient care at teaching hospitals, such as having more complex patients, offering cutting-edge research and treatments, providing around-the-clock access to expertise and services often unavailable elsewhere in the community, and other responsibilities unique to teaching and learning. GME AT UC UC medical centers oversee training for more than 4,400 resident physicians who receive training at UC hospitals and affiliated sites such as community hospitals and VA medical centers as part of their in-depth instruction. Of these, more than 2,300 full-time positions are based at UC medical centers, for which they receive about $200 million per year in Medicare GME payments. Those 2,300 FTE positions include almost 300 training positions at UC hospitals for which UC receives no federal support to help offset the cost of training physicians. Put another way, UC medical centers receive an average of approximately $100,000 in Medicare GME payments for each FTE position annually. The funding includes support for the higher costs associated with medical education training, the provision of highly specialized clinical care services and cutting-edge research that comprise the unique mission of teaching hospitals. But teaching hospitals incur training and clinical care costs well beyond what Medicare pays to support medical education training. On average, UC s annual direct costs associated with residency training range up to $130,000 per FTE to as much as $200,000, including indirect costs. Costs vary by year of training, site and specialty. UC residents rotate through university hospitals and other teaching sites. That results in 2,100 FTE positions based at the VA or other affiliated hospitals that also rely on federal funds to support the resident training mission. Cuts in GME funding would not only reduce the number of residents who train at UC medical centers, but also would have a ripple effect, reducing training positions at the VA and affiliated hospitals.

5 Since its inception, Medicare has provided funds to teaching hospitals for the higher costs associated with their unique patient care, education and research missions.

6 POTENTIAL Cuts The National Commission on Fiscal Responsibility and Reform recommends cutting Medicare GME payments by $60 billion over 10 years. This would have a significant impact on UC Health. Location Initial-Year Reduction 10-Year Reduction (In Millions) UC Davis Medical Center ($18.1) ($191.5) UC Irvine Medical Center ($7.7) ($77.0) UCLA Medical Center ($23.0) ($242) UC San Diego Medical Center ($11.9) ($126.9) UCSF Medical Center ($25.0) ($264.7) UC Health Total ($85.7) ($902.1)

7 CUTTING GME FUNDS WOULD DECREASE PATIENT ACCESS. California needs more primary and specialty care doctors. Currently, 51 of California s 58 counties have at least one federally designated Health Professional Shortage Area. One county has no physician in residence, another has only one and many face growing physician shortages in primary care and other medical specialties. UC s more than 4,400 resident physicians work and learn in more than 300 independently accredited training programs representing all recognized medical and surgical specialties and subspecialties. These residents also train at affiliated sites such as community hospitals and VA medical centers, magnifying the impact to UC of any cuts in GME payments. An additional 570 residents train in UC-affiliated family medicine programs. Doctors tend to practice near where they train. California has the nation s secondhighest retention rate for medical residents, 69 percent. Similarly, the state ranks fifth in retention of physicians who graduate from an in-state medical school and then complete their residency at an in-state teaching hospital. UC s ability to train physicians to meet state needs would be significantly compromised if Medicare GME payments were reduced. Access is already an issue for Medicare patients. More of UC s Medicare admissions are transfers from other hospitals that lack the capacity to care for them. In order to protect access for Medicare patients, the federal government needs to maintain GME payments. For teaching hospitals such as UC medical centers, GME cuts would not only hurt their ability to train physicians but also undermine their efforts to provide vital services such as trauma and burn care. CUTTING GME FUNDS WOULD HURT THE ECONOMY. For every $1 the federal government cuts in indirect GME payments, the hospital s state economy loses $3.84, according to a study conducted for the Association of American Medical Colleges. The proposed cut also would result in a job loss of more than 72,600 FTEs nationally, including 4,242 jobs in California. UC Health serves as an economic engine, providing good jobs, attracting research funding and generating significant economic output. For example, the UC Davis Health System generates more than 20,000 jobs and nearly $3.5 billion a year in economic impact, according to a study by the Center for Strategic Economic Research. Any decreases in GME payments would have a ripple effect on communities near teaching hospitals.

8 LIFTING MEDICARE S GME CAPS WOULD IMPROVE ACCESS. The need for doctors has grown, but federal support has not kept pace. In 1997, Congress froze the number of physician training slots it would support through Medicare. These caps impose hospital-specific limits on the number of residents that teaching hospitals can count for purposes of receiving GME support. The caps have a chilling effect on the ability of teaching hospitals and medical schools to respond to physician work force needs and meet the health needs of local communities. UC is already significantly underfunded for graduate medical education. UC medical centers train almost 300 FTE residents who receive no Medicare support. The caps also hamper efforts to build new programs in high-need areas of California, including Inland Southern California, where the shortage of primary care physicians is particularly acute. This affects the UC Riverside School of Medicine, which is being developed with the express purpose of expanding this region s physician work force, in part by partnering with community-based medical centers to build new residency training programs. California has 12.1 percent of the nation s population but only 8.5 percent of its medical residents and fellows. If California had a share proportional to the national average, it would have another 3,900 medical residents and fellows. Without action, the United States faces a shortfall of 91,500 physicians by 2020, according to AAMC estimates. The demand is being driven by a population that is growing and aging. I want to pursue primary care. To train primary care physicians, we need good programs, and that requires more funding. It's extremely important that we invest in training residents. The whole country will benefit from having high-quality physicians. Dr. Joyce Ann Viloria UCSF medical resident

9 Dr. Joyce Ann Viloria is training in UCSF's primary care urban underserved track at SF General Hospital.

10 A Significant ROLE UC trains nearly half of California s medical residents and fellows. 661 UC Davis 587 UC Irvine 9,200 Total California Medical Residents 1,330 UCLA 696 UC San Diego 1,145 UCSF ON THE FRONT LINES More than one-third of UC medical residents train in primary care. 1,614 Primary Care 4,419 Total UC Medical Residents 919 Hospital-Based Specialties 782 Surgery 1,104 Other Specialties

11 UC HEALTH AT A GLANCE UC Health runs California s fourth-largest health care delivery system and the nation s largest health sciences training program. UC Health includes five academic medical centers UC Davis, UC Irvine, UCLA, UC San Diego and UC San Francisco and 16 health professional schools. UC staffs five trauma centers, provides half of transplants and one-fourth of extensive burn care in the state, and cares for a significant segment of the state s indigent and publicly insured patients 40 percent of UC patients are uninsured or covered by Medi-Cal. UC is working to train more physicians. UC s innovative PRIME programs for medical students focus on meeting the needs of California s underserved populations in both rural communities and urban areas by combining specialized coursework, structured clinical experiences, advanced independent study and mentoring. Total PRIME enrollment has grown from eight students in 2004 to approximately 250 students in 2010 the first substantial increase in UC medical school enrollment in 40 years. UC Riverside School of Medicine is preparing to enroll its first class of 50 students in August 2012, but the opening may be delayed because of state budget concerns. UC Merced medical education planning is ongoing, including adding a new PRIME program focused on the needs of the San Joaquin Valley. UC is working to improve quality, access and value in the delivery of care. In October 2010, UC launched the Center for Health Quality and Innovation to promote and advance innovations in clinical care that will improve patient outcomes and quality of care within the UC system and beyond. UC has increased student diversity at its medical schools aided by its PRIME, postbaccalaureate and other programs. UCLA s International Medical Graduate Program addresses the shortage of Hispanic doctors, preparing Latin American physicians living legally in California to become licensed doctors in this state.

12 UC HEALTH CONTACT INFORMATION Federal Governmental Relations David Brown (202) Health Sciences and Services Santiago Muñoz (510) Cathryn Nation (510) CoMMUnications Alec Rosenberg (510)

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