Graduate Medical Education Payments

HEHS-97-77R: Published: Mar 3, 1997. Publicly Released: Apr 2, 1997.

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William J. Scanlon
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Pursuant to a congressional request, GAO provided information on: (1) existing studies that estimate overall Medicaid expenditures for graduate medical education (GME); (2) the amount of Medicaid GME payments for the 10 states with the largest overall Medicaid expenditures, and the basis for determining these payments; and (3) how Medicaid and Medicare coordinate their GME payments to avoid duplication.

GAO noted that: (1) although the exact amount of Medicaid GME payments is unknown, two studies estimated these expenditures at about $1.3 billion and $2.2 billion in fiscal year (FY) 1995; (2) 8 of the 10 states with the largest overall Medicaid expenditures for FY 1995 provided support to teaching hospitals for costs associated with GME; (3) these states used different methods to calculate their GME payments, and their annual estimated expenditures for GME, which they generally considered rough approximations, ranged from a low of $17 million to a high of $870 million; (4) regarding whether programs coordinate their GME payments, Health Care Financing Administration (HCFA) officials told GAO that HCFA does not determine whether Medicaid GME payments duplicate those made by Medicare; (5) on the other hand, officials from the eight states told GAO that their payments were intended to cover Medicaid's share of GME; and (6) GAO could not independently determine from the documents reviewed if duplication exists because states' plans often did not contain sufficient detail explaining their Medicaid GME payment systems.

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