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There's a few problems with this. First of all losing $1.7 billion is different that saving $200,000 per year. The other thing that both these studies fail to account for is that if you bring in NPPs then you increase the revenue. If you replace the residents with non-providers for the 20-25% of work that they estimate residents do that is not related to resident education then yes thats money lost. However, one could argue thats money that the program should be spending in the first place.http://www.aafp.org/online/en/home/...ident-student-focus/20090702acgme-tstmny.html
Family Medicine Leaders Urge ACGME to Resist Call for More Limits on Residents' Duty Hours
"The testimony from Epperly -- who also is program director and CEO of the Family Medicine Residency of Idaho -- and others came in response to recommendations contained in a report released by the Institute of Medicine, or IOM, in December 2008. In the report, the IOM recommended that continuous on-site duty periods for residents not exceed 16 hours unless a five-hour uninterrupted sleep period is provided between 10 p.m. and 8 a.m.
Other recommendations in the IOM report, "Resident Duty Hours: Enhancing Sleep, Supervision and Safety," proposed reducing residents' workloads and increasing the number of days they would have off each month.
The IOM estimated that the cost of shifting resident work to other clinicians to comply with the proposed changes would be $1.7 billion a year. A later report from the nonprofit research organization RAND Corp. and the University of California, Los Angeles, estimated those costs at $1.6 billion a year."
On the revenue side lets take surgery for example. If you replaced the residents with PAs and nothing else changed, then your operative collections would immediately climb 14.5% or more. Critical care and hospital medicine also would substantially improve collections above what you get with residents. Or if you really wanted to maximize revenue you could have the PAs do all the OR work and the residents do all the floor work. But then you don't have much of a surgery residency (the primary reason for the surgery teaching rule). The additional billing using NPPs almost always outweighs the money that a hospital gets for residents if the payor mix is decent.
The point that the IOM danced around is that residency represents an indirect subsidy for safety net hospitals. If you look at your Grady's, or DG or name your county hospital they could not exist without cheap resident labor. There payor mix is skewed toward the un-insured so if they had to use another provider they face increased costs without increased revenues.
My point here is not to belittle what residents do, its to show that with the current system, your statement that residents save hospitals money is only true for a subset of hospitals. For that matter the vast majority of hospitals in the US are not teaching hospitals and get along just fine without residents as would most teaching hospitals. The purpose of a teaching hospital should be to provide a quality GME and take care of patients.
Residents will not make money for a hospital with a decent payor mix unless they can bill. And that as APD has shown in a number of posts opens up a different can of worms.
David Carpenter, PA-C