Do you know of those huge bottle of TUMS you see at the drugstore? Every medical school admissions dean is issued a bottle on April 1 in preparation for the five weeks that follow.
Based on historic data, each schools knows its yield. That is the proportion of applicants who accept the offer. So, if we know that we need to make 250 offers to fill 100 seats, we make 2500 offers and hope to God that we get 150 applicants who withdraw and go elsewhere. When it gets to be April 28th and there are still 200 applicants who have not turned down the offer, the bottle of TUMS comes out. A school could make 120 offers and back fill from the waitlist but some applicants will say "screw you Bigdeal School of Medicine, you should have taken me straight away rather than waitlisting me... I've decided to go to Hotstuff Med School instead because they didn't disrespect me." I think that depending too much on the waitlist results in a weaker class than giving offers to the top 250 and hoping for the best.
So, you are going to ask, "what happens if too many applicants accept?" This is a tremendous fear and thus the TUMS to help with that indigestion that comes from the spring season worry that is endemic in admissions offices. It happens very rarely. A school will try to make an attractive offer (like a year of school at no charge) in exchange for sitting out a year and matriculating a year later. Some applicants will stay at a good job or go back to school for another degree during that gap year, others will decline the offer because it means starting as an attending a year later than would happen otherwise.
Oh, and a school that has an over-enrollment generally has a new dean of admissions the following year.