Wednesday, March 27, 2013

The Cost of Training a Resident

In recent posts, I've talked about the obligation some physicians may feel to work full time, considering society has invested so much in training us. Yet it doesn't feel like we were handed anything on a silver platter. Many medical students go a quarter of a million dollars in debt during med school. When I was an intern, I worked about 80 hours a week and earned $40,000 per year. That's $10/hour, which is way less than I made doing math tutoring after school in high school.

This seems like a pretty good deal for hospital, actually. So I'm not sure why they don't just hire tons of residents? Why is there such a bottleneck in resident training positions?

I did a little online research into this, and if anyone wants to add their two cents, you're welcome to because I'm still a little confused. Here are the facts, as I understand them:

1) Residency positions are limited.

2) It costs upwards of $100,000 each to train a resident, including salary, benefits, and paying attendings to teach.

3) Private insurance companies WILL NOT pay for residents. Not even a dime, despite the fact that residents may be providing most of the care for their patients.

4) Medicare and hospitals mostly foot the bill for residents.

I suppose it makes a little more sense why more spots can't be created when you look at how much hospitals and the government must pay. Yet I still can't entirely fathom how residents doing a job that would cost literally ten times as much if an attending were doing it is somehow a loss. Yes, there is a supervising attending. But we all know attendings in academia get paid less. An attending would have to be paid WAY more (and they're have to be more of them) to handle the workload that residents take care of.

Also, there's the fact that a lot of primary care positions, FM, and IM positions don't even get filled.

So even though I understand the details, I still can't honestly say I understand.

16 comments:

  1. With all the costs and salary I thought it was much more expensive than $100K to fully train a resident.

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    1. I've never seen a number quoted higher than $120K, which is less than most attending salaries.

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    2. Simply economic theory here, lower the supply, raise the price of Physician services. there are 800,000 physician in the US, do the math, that is 375 patient per physician, the problem is specialization not physician shortage, too many specialist is our problem, there is no shortage

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  2. Yep, I recently worked out that when South African interns earn the equivalent of $8 an hour... which is just ridiculous. Your other points are valid too, but I agree: I still don't understand.

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  3. but then if you get granular it would become more difficult. There is a difference between IM, Surgery, Peds, and PM&R.

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  4. As an aside, your comment about "a lot" of primary care positions not being filled is inaccurate.
    NRMP 2012 %Filled
    FP. 94.6
    IM. 99
    Peds. 98.7

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    1. This year was particularly competitive in primary care - there were a lot fewer spots than usual left for the SOAP, especially in peds, and all spots were completely filled during the soap such that an unprecedented number of allopathic students went completely unmatched this year. My school still has 11 people who do not even have a prelim spot for next year. A few have decided to get an MBA or an MPH, but it's not like there's going to be extra spots waiting for them next year.
      This year alone there were 40,000 applicants for 28,000 spots in the NRMP.

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  5. The quote I found for Canada is $760,000 for residency to train a specialist. Programs have variable lengths but using a conservative 5 years that is $152000 which is less than half of the average yearly salary for an attending specialist.

    The cost per hour to pay a clinical assistant for a similar job (does the work but needs to be supervised by an attending) is $100-$150/hr. If you used a 40hr/week (half of a typical week but might be fair given that they would not have to replace elective time, research time and some educational rotations) at $100/hr for a 48week year that would be $19200.

    Residents are a deal. But I wouldn't say that residency spots are the bottle neck here.

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  6. I hate to sound stupid, but isn't the answer already listed? If private insurance won't pay, then they take a hit for those patients. Does the difference between Medicare reimbursement and resident cost (versus the higher paid attending) make up for private ins pts? I can't imagine that it does.

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    1. I guess what I don't understand is why private insurance can't pay.

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    2. I believe the hospital still gets paid for these patients, because an attending does have to see them and sign off. Though I find it interesting that in our Ophthalmology clinic, the residents often see the patients without the attendings poking their heads in, except when the patient is a Medicare patient. Then they have to get an attending to sign off. So I'm not sure how much I trust the 'private insurance doesn't pay for resident care' theory.

      Of course, teaching hospitals run much more slowly than private hospitals, and probably don't make as much as a result (less patient volume per physician). So that likely contributes as well.

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  7. http://www.nytimes.com/2013/03/28/health/trainees-in-radiology-and-other-specialties-see-dream-jobs-disappearing.html gives a figure of $150,000 per resident per year.

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  8. Maybe I can help shed some light on the insurance issue, which is that physicans much be board eligible or certified according to most insurers. This probably goes back to Medicare rules, which most private isurers follow. Although some are allowing NP's to be listed as a primary care provider (PCP) for example; so, it'll be interesting to see what happens in the future.

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    1. Reimbursement for NPs as PCP raises an interesting point as residents have more training than NPs (even on Day 1 of residency).

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  9. I think it's a big fat "it depends". For anesthesia, for example, we (I think) finally got rid of the 50% rule, so that an attending running 2 rooms with residents can now bill 100% for both cases (just like the surgeons). However, CMS will only pay out if the attending is running 2 rooms or less, whereas if the attending was running rooms with just CRNAs, they could run up to 4 rooms. The RRC takes a pretty dim view of it as well, since it sort of conflicts with the educational obligations of the program. Not only that, but if I run a room with a CRNA I can run it faster than with the average resident, even with equivalent supervision. And supervision is never equivalent, since it is the rare resident who doesn't need help positioning etc. It's that whole training thing. Of course, we're paying the resident less than half of what the CRNA makes, not to mention the fat bundle of lucre from uncle sam. Overall, in an academic center, it's about a push for productivity/ $. In a surgicenter environment, where I might be responsible for 20 or 30 cases, there is no comparison-- no resident is capable of that kind of turnover.
    Should private insurers be directly responsible for some of the financial burden of training residents?

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    1. "Should private insurers be directly responsible for some of the financial burden of training residents?"

      They would say, "no," as this would interfere with them making increasing their profits each year, while hospitals and docs get paid less. Aetna made more last year than any previous years.

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