Private funding for residency slots.

Private funding for residency slots.

Private funding for residency slots.

Health and medicine explained.
June 30 2005 7:15 AM

How Much for That Dermatologist in the Window?

Private funding for residency slots.

Corporate-sponsored docs? Click image to expand.
Corporate-sponsored docs?

Exactly a year from now, unbeknown to them, 10 of the country's 1,000-plus dermatology residents will begin training courtesy of the pharmaceutical industry. The idea of corporate funding for residency slots has led to predictable hand-wringing over whether allowing companies like 3M (makers of Aldara cream), Amgen (makers of the anti-psoriasis drug Enbrel), and OrthoNeutrogena (makers of Retin-A and, of course, Neutrogena) will help solidify the influence of the drug industry on doctors. The response has been that the country needs more dermatologists.

Have drug companies in fact stumbled upon an underfunded area ripe for their intervention? Through Medicare, the federal government funds the more than 100,000 residency slots in the several hundred teaching hospitals in the United States (to the tune of $80,000 per resident per year, on average). Because the total number of residents funded by Medicare has been fixed by the Balanced Budget Act since 1997, a particular hospital or specialty that wants more residents of a given sort must either pilfer some of the slots of another specialty—a difficult trick—or find outside funding for them. Enter 3M, OrthoNeutrogena, and Amgen—and the potential for a distortion of the delivery of health care that could leave Americans with more specialists but less access to the basic care they need.

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The specialties that hospitals offer, and that residents choose, play an important role in determining the direction of medicine. Give a man a hammer and everything's a nail; make him a surgeon, and everyone needs an operation. The task of telling hospitals how many residents of each sort to train is undertaken by groups that represent teaching hospitals, specialties, and medical schools. Ideally, these groups would know exactly how many dermatologists, cardiac surgeons, and ophthalmologists the country would need at a given time and simply adjust residency slots accordingly.

The problem is that because it takes so long to train new doctors—10 years after medical school in some fields—the models used to suss out future needs don't work well. They can account easily for future population and fairly well for the diseases people will have, but they can only make wild guesses about what technologies and treatments will be available to treat those diseases. The pediatrics my father learned during his residency in the late 1960s is different from the pediatrics he practiced in the 1980s and '90s—when there were new vaccines, new treatment guidelines, and even new diseases. When a government committee issued an influential report in 1980 about the supply of physicians, cardiac stents (the small mesh tubes that keep Vice President Dick Cheney's heart beating) hadn't even been invented. So, how could the committee guess how many invasive cardiologists would be needed today?

In addition, the choices doctors make about where to live can dramatically affect the supply of specialists in a given region. When you look at a field like allergy and immunology, which currently has between 3,000 and 4,000 practitioners spread across 3,300 counties nationwide, small perturbations make the difference between a place—say, rural Nebraska—with no allergists and a place with too many allergists—say, the Upper East Side. To make such calculations even more difficult, it may be that Nebraska's dermatologists and pediatricians are doing the work of the missing allergists, which means their absence goes unnoticed.

For many years, however, none of that stopped the government from taking as gospel the findings of the Graduate Medical Education National Advisory Committee, a group created by the secretary of health and human services. In 1980, GMENAC issued an influential report predicting a national surplus of doctors, based on a number of questionable assumptions. Eager to cut costs, in 1981 Congress seized on the doctor-surplus prediction to cut support for the education of medical students (though Medicare's payment for residency training was formalized two years later). After GMENAC's charter ran out, it was supplanted in 1986 by another federally funded group, the Council on Graduate Medical Education. COGME is made up of researchers and medical-school administrators, and it has been more independent and realistic about making predictions than its predecessor. Last year, the group forecast a shortage of doctors nationwide by 2020. But while its latest report says that the country will need more specialists as well as generalists, it doesn't make specific recommendations about which specialties should increase by how much.

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That leaves hospitals to make their own best guesses, which end up being based on their own needs. In the high-volume atmosphere of most teaching hospitals, it's generalists who matter. That's why we end up with about 22,000 internal-medicine residents each year; 8,000 pediatrics residents; 7,500 surgery residents; 4,000 emergency-room residents; only 1,000 dermatology residents; and only 310 thoracic surgery fellows. The aggregate needs of the teaching hospitals don't always line up with those of the nation, and most residents don't stay at the hospitals at which they train. The resulting mismatches cause some grief. A 2003 survey of residents completing training in cardiothoracic surgery, for example, found that while most had found jobs, about 15 percent "pursued additional training due to lack of job opportunities."

COGME used to help hospitals figure out the number of doctors in each specialty to train, and it would be a good idea for the group to find an accurate way to do so again. (Take a look at this model by Richard Cooper, director of the Health Policy Institute at the Medical College of Wisconsin.) In the meantime, Congress could help a lot by lifting the Medicare funding cap for residency training, so that specialties don't need to turn to private funding for additional slots, as the American Academy of Dermatology has done.

The real problem with corporate sponsorship isn't that dermatologists are more likely to prescribe Neutrogena products if they know the company is paying for their residencies, though that should give us some pause. It's that there will be more dermatologists diagnosing more diseases that could require Neutrogena products. If cardiac-equipment companies start sponsoring residency slots, they'll pay for the ones in invasive cardiology, because those are the doctors who diagnose patients with problems that stents can treat. If drug and device manufacturers are interested in residency training, then let them donate into a big fund that is doled out according to a defensible assessment of clinical needs, not commercial ones. Residency training is a public good, and people working on behalf of the public good should be the ones deciding where the money for it goes.

Ivan Oransky is a distinguished writer in residence at New York University, editor at large of MedPage Today, and co-founder of Retraction Watch.