Obama's Hospital Funding Cuts Equals PCP Shortage

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NEW YORK—A plan to reduce federal funding for teaching hospitals in President Barack Obama’s fiscal 2013 budget proposal will curb training for primary care doctors, undermining a top priority of the 2010 health-care law he fought to enact, a Bloomberg Government study shows.

The law would expand medical coverage to as many as 32 million uninsured people, flooding the system with new patients and driving up demand for family physicians. To narrow the deficit, the president plans to save $9.7 billion over nine years by reducing what Medicare (USBOMDCR) pays to train new doctors.

The proposed cuts, if enacted, will cause hospitals to adjust the mix of residency slots to focus on specialty positions that are the most profitable, according to the study by Bloomberg Government health-care analyst Brian Rye. That will steer medical students to specialties that can pay twice as much as primary care, according to medical school executives.

“You can tell people primary care is great all you want, but unless you show you value it through the payment system, people are always going to go for the economic incentives,” said Atul Grover, chief public policy officer for the Association of American Medical Colleges, in a telephone interview.

Medicare, the U.S. health program for the elderly and disabled, provided about $9.5 billion to hospitals in 2010 to offset the cost of sponsoring residency programs in which graduate medical students train before working independently. Grover’s group estimates the training cuts will contribute to a shortage of 60,000 physicians in the U.S. by 2015.

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