CMS Awards 200 Residency Slots to Bolster Healthcare Workforce

January 10, 2023 - CMS has awarded 200 Medicare-funded residency slots to support hospitals in underserved communities, according to a recent announcement. The awards are part of a larger push to provide 1,000 physician residency slots to qualifying hospitals to bolster health equity and the healthcare workforce.

“These graduate medical education residency slot awards will help address access to care challenges and workforce shortages in the highest need areas,” CMS Administrator Chiquita Brooks-LaSure said in the announcement. “The majority of the positions are for primary care and mental health specialists, who are the foundation of our health care system.”

About three-quarters of the new physician residency slots are reserved for primary care, including obstetrics and gynecology, and mental health specialties, the announcement stated. CMS intends for these training opportunities to improve access to critical medical services, including those necessary for to address mental health, in rural and underserved communities.

Expanding workforce capacity, including the training of residents, is a key part of the federal agency’s Behavioral Health Strategy, an initiative aimed at improving mental health and substance use disorder access and services in the US. HHS has also identified a need to bolster the workforce in order to strengthen primary care.

“This is critical in advancing our goals of providing high-quality care to all people,” Meena Seshamani, MD, PhD, Deputy Administrator and Director for CMS’ Center for Medicare, said in yesterday’s announcement.

The first round of Medicare-funded residency slots was awarded to 100 teaching hospitals across 30 states, the District of Columbia, and Puerto Rico. The slots will be effective July 1, 2023.

The US is expected to see a shortage of 37,800 to 124,000 physicians by 2034, according to data published in 2021 by the Association of American Medical Colleges (AAMC). Of that shortage, between 17,800 to 48,000 are expected in primary care.

“The COVID-19 pandemic has highlighted many of the deepest disparities in health and access to health care services and exposed vulnerabilities in the health care system,” AAMC president and CEO David J. Skorton, MD, said at the time. “The pandemic also has underscored the vital role that physicians and other health care providers play in our nation’s health care infrastructure and the need to ensure we have enough physicians to meet America’s needs.”

CMS finalized a policy in the fiscal year (FY) 2022 Medicare Hospital Inpatient Prospective Payment System rule that would create more physician residency slots funded by Medicare over the next five years. The agency said it will prioritize hospitals that serve geographic areas and underserved populations with the greatest need.

However, the American Hospital Association (AHA) has expressed concerns with CMS’ plans to distribute more Medicare-funded residency slots under the IPPS. The hospital industry group said CMS also modified the distribution method to award residency slots based on the length of the training program. The agency also changed how it will determine which hospitals qualify for residency slots. A hospital’s main campus or provider-based facility no longer has to be physically located in a primary care or mental health professional shortage area (HPSA) to be eligible for funding.

Prioritizing residency slot distribution based on HPSA scores and training time in HPSA areas was concerning to AHA. The changes require a significant amount of training time to occur in HPSAs.

“This reliance on HPSAs minimizes Congress’ other priorities to expand training slots for hospitals in rural areas, training above their cap, and in states with new medical schools,” AHA wrote to CMS in a 2022 letter.

CMS said in the announcement yesterday that the application period for the second round of 200 residency positions will open this month and close at the end of March.