Securing Medicare GME Funding For Outside Rotations


A number of emergency medicine (EM) residency programs are based in settings in which the clinical experience available to the residents is limited in some manner. In order to provide the broad clinical experience required for high-quality training, these programs ideally would arrange for their residents to do "outside rotations" at other institutions.

For example, programs lacking sufficient experience in the management of trauma for both adults and children would send their residents to a trauma center. Likewise, exposure to the care of pediatric emergencies is often undertaken at a separate children's hospital. In these settings, the "outside rotation" institution is usually set up to handle Medicare funding of graduate medical education (GME) and may elect to seek Medicare funding for the time that these residents from another program spent at their institution.

When this occurs, it is common to have the primary institution, as part of the affiliation agreement between institutions that govern the training of these residents, seek all or a portion of those monies from the outside rotation site. This is done because the primary institution remains responsible for the house officers' salaries and benefits. On the other hand, some institutions with GME programs that serve as outside rotation sites do not bill Medicare for the resident services, and this money is lost to both institutions under the current guidelines.

Community or Rural Institutions/Other Services

Almost as frequently and as important is the residency program that desires to expose the resident to a suburban or rural "community" hospital emergency department (ED) experience in which there are no other resident trainees in the institution and no GME programs in place.

The community hospital setting is an important experience for a resident trainee since 80% of all job placements at graduation will be in hospital EDs where there are no GME programs in place, i.e. the suburban or rural community hospital setting. This restriction is especially burdensome under current law, as the outside rotation institution is unable to secure GME funding to set up its own residency program, and many rural hospitals are unwilling to incur the paperwork burden of applying for Medicare funding for the small amount of GME costs incurred. Thus, residents are essentially precluded from an educational exposure to a setting that is likely similar to their eventual practice environment. Rural communities especially miss out on opportunities for residents to experience practicing in rural settings at a time when these hospitals are in desperate need of emergency medicine trained physicians.

Other resident trainee experiences that may be necessary to ensure a broad clinical experience occur in settings where the outside rotation institution is unlikely (or unable) to seek reimbursement from Medicare for resident educational experience and service. The classic example is time spent on a toxicology service at a poison control center. Specialized treatment centers and experiences in research at institutions such as the National Institute of Health (NIH) also fall into this category of resident training. This valuable educational experience is not sustainable because of the loss of GME funding to the parent institution that the outside rotation institution is unable to secure.  

Current Legislation

Section 1886 (h)(4)(E), the direct medical education (DME) section of the Social Security Act, states that "such rules shall provide that only time spent in activities relating to patient care shall be counted and that all the time so spent by a resident under an approved medical residency
training program shall be counted towards the determination of full-time equivalency, without regard to the setting in which the activities are performed, if the hospital incurs all, or substantially all, of the costs, for the training program."

The statue clearly does not bar payment to outside hospital rotations. However, as noted below, the implementing regulations do bar such payments, so that is where ACEP should focus its advocacy efforts.

The regulations address hospitals seeking Medicare funding for GME for settings that are not hospital-based but where their residents spend time. The language states: "A hospital may count residents training in non-hospital settings for direct GME purposes... if the residents spend their time in patient care activities and if… the hospital incurs all, or substantially all, of the costs for the training program in that setting...there must be a written agreement between the hospital and the non-hospital site... stating that the hospital will incur all or substantially all of the costs of training in the non-hospital setting (and) further specify... the amount of compensation provided by the hospital to the non-hospital site for supervisory teaching activities." The regulation goes on to say that "a hospital cannot claim the time spent by residents training at another hospital," 42CFR 413.78 (Code of Federal Regulations - Principles of Reasonable Cost Reimbursement; Direct GME Payments). 

It is clear this language does not apply to a relationship between two hospitals (the most common arrangement for EM outside rotations) as it specifically addresses an outpatient (non-hospital) setting. Unfortunately, this same language precludes even the less common non-hospital based EM outside rotations because it is rare that the non-hospital institution will be staffed by supervisory personnel paid by the parent institution.

Proposed Revisions to Current Regulations/Financial Impact

Proposed revisions need to address outside rotations applicable to emergency medicine residency training described above.
The financial impact to the federal government would be modest. It is important to note that emergency medicine programs are not seeking to "double dip" in this proposal; if the outside rotation institution is receiving Medicare funds for the rotating resident, than it is up to the parent institution to seek funding from the outside institution to support the residents' salaries and benefits.

ACEP Advocacy

The American College of Emergency Physicians (ACEP) can assist residency programs in providing the broad clinical experience necessary for high-quality training in emergency medicine by working with the Centers for Medicare and Medicaid Services (CMS) to revise the regulations. These revisions would allow a training program's parent institution to receive GME payment for residents engaged in outside rotations in those circumstances where the "outside rotation" institution does not receive GME funding for the residents' time in that setting.

Paper developed by members of the 2004-05 Academic Affairs Committee

David A. Caro, MD, FACEP, Chair
David S. Howes, MD, FACEP, Subcommittee Chair
Philip H. Shayne, MD, FACEP
Sandra M. Schneider, MD, FACEP, Board Liaison

August 2005


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