I have a feeling many of the posters responding have not actually read the article. You should do so, as it's not actually suggesting resident tuition by my interpretation.
Here's a perspective article written by some PhD Economists that lays the groundwork for the government and hospitals to stop "subsidizing" graduate medical education. They argue that since Residency training teaches general skills that can be used anywhere, the trainee should bear the cost.
No, they don't. If you read pieces of the article it may appear that way, but you're missing the overall message. It's actually saying that residents are
currently bearing the cost of their own training.
Here's the statement you're referring to:
The training provided to both medical students and residents is general training — that is, it can be used anywhere — in contrast to specific training, which can be used only at the place where the training occurs. (There may be a small amount of specific training involved — for instance, learning a software package used only at a particular hospital — but that is the exception.) Because general training is so portable, it would make no sense, in purely economic terms, for employers to subsidize its cost; they would not be able to recoup their investment, because once trained, physicians can and do practice wherever they wish. The point is not that general training should not be supplied but that it should not be subsidized; similarly, another job involving a substantial general-training component, such as a new MBA's on-the-job training in reading balance sheets, will have a lower salary than business jobs for which fully trained personnel are hired.
The authors use this paragraph as a springboard to explain why resident education is not actually subsidized, and how residents pay for themselves:
In his theory of human capital, Nobel Laureate Gary Becker explains why economists believe that residents, not the hospital where they obtain their training, bear the full cost of their education: they accept lower wages during training that offset training's significant costs.2 For example, if the total cost of training a resident is $80,000 annually but his or her services generate $130,000 in hospital revenue, then the resident would appropriately be paid a salary of $50,000 — the difference between the two.
In other words, residents create some gross income for the hospital (let's call it G), and training a resident costs a certain amount of money (less than the income generated, call it T). The difference (G - T) is resident salary, and the remainder is retained by the hospital to offset the cost of training (T). This is explained further in the later paragraphs:
Why are residents paid wages whereas medical students pay tuition? Both receive some amount of training and education and provide some amount of services, but the relative valuation of and time devoted to services received and services provided differs dramatically between residents and medical students.
Medical students provide relatively minor amounts of service, acting mostly as apprentices or observers. They are primarily receiving a costly education in basic and clinical sciences, and they generate minimal revenue; thus, they pay tuition for the education they receive.
Residents receive some direct educational benefits, and their practice during training can incur costs for the hospital; for example, they tend to order more tests and services than fully trained physicians do. But unlike medical students, residents provide substantial amounts of service to patients, thereby generating substantial revenues for their hospitals, particularly after the first year of residency.
In this example, a medical student generates a G than is significantly less than T, so the difference is negative, and the absolute value of that difference is tuition. For a resident, G is greater than T, and so residents are paid salary, with T retained by the hospital as payment for training costs.
This theory is well known to most economists, and there is empirical evidence that strongly supports it. If GME funds were subsidizing resident salaries, those salaries and the numbers of residency positions should have changed when GME funding was adjusted. However, despite large changes in GME funding, residents' salaries have remained constant over time; indeed, not only did the number of residents not decrease when GME monies were reduced but it actually continued to increase after several years of adjustment.
This is where the author argues that GME money is NOT being used to subsidize training. If it were, they say, resident salaries should rise with increases in GME training. They have not, which lends further evidence to the fact that the amount a hospital is actually willing to pay has more to do with the funds residents are capable of generating.
The point of the whole thing, which the authors make in the last few paragraphs, is that simply increasing GME funding is unlikely to solve the physician crisis, since the increased funding is unlikely to go to physicians in training and more likely to be added to the hospital general funds.