What is the truth behind the resident salary?

TLDR

A crucial step in becoming a practicing physician is residency, a challenging yet insightful experience. It is the ultimate exam: one where a mistake no longer means a lower score but may cost a life. Naturally, anyone with such an onerous job would be expected to be quite highly paid, but much to our surprise, residents are paid as much as high school teachers or librarians. This article will delve into the background behind the deep-rooted resident stipend issue and how our nation has dealt with it.  

What is residency? A brief overiew

Residency is a term every prospective medical student should get a comfortable hearing as they venture further into their careers. The journey does not simply end with a medical degree adorned with your name. Applying all that you’ve learned thus far is just as important, if not more. A resident has a medical degree and can deliver direct patient care (supervised, of course). They work in their respective department under the mentorship of the attending physician. Their responsibilities include but are not limited to ordering and interpreting tests, running examinations, scribing, and assisting with medical procedures ¹. The duration of one’s residency can last anywhere from three to seven years, depending on the specialty the student has matched for ¹. 

A Medical Resident’s Salary

Apart from the overbearing workload, the student debt, the long hours, and the fear of making a mistake, a common concern is the salary of medical residents ². While residency wages are relatively consistent regardless of the specialty, the overall compensation is low compared to other professionals that have not dedicated as much time and money to get to where they are ³. The number of residents that feel adequately compensated decreases each year ⁴.

According to the “AAMC Survey of Resident/Fellow Stipends and Benefits,” the average annual stipend for first-year medical residents nationwide (as of July 1, 2020) was $58,921 ⁵. This survey was administered to around 359 institutions, out of which 190 were deemed usable ⁵. Out of the 190 verified responses, 58 were medical schools, and 132 were non-VA Council of Teaching Hospitals and Health Systems (COTH) ⁵. The data consisted of a total of 105,753 resident stipends ⁵. The average mean value that was reported weighed each institution equally, regardless of the number of residents and fellows ⁵. This data calls to investigate healthcare funding and government-implemented health relief acts that have attempted to appease the low salary dilemma. Although these have surprisingly resulted in a loss of working physicians instead. 

The Source of the Problem: Residency Funding

Physicians are a necessity for the well-being of our society. With the recent COVID-19 pandemic, the current physician shortage has been unveiled. A significant reason for the lack of physicians in the workforce is the shortage of residency training spots due to a lack of funding. Funding for residency positions mostly comes from federal funding. GME ( Graduate medical education)  encompasses training received by medical students post-graduation to become a physician (including residency & fellowship) ⁶. GME’s most significant funding comes from federal funding; however, it also has smaller funds from state and private entities.⁶ Federal funds for GME come in through DGME (Direct GME) and IME (Indirect Medical Education). These programs are both controlled by Medicare ⁶. Medicare is managed by the Centers for Medicare and Medicaid Services (CMS).

This flowchart shows the pathway that federal funds for graduate medical education come through. 

Previously in the 1900s, hospitals used their own money to train residents ⁶. In 1965, Congress created Medicare and realized that an increase in health coverage would increase the number of physicians ⁶. Congress knew that private hospitals could not fund the increasing number of physicians by themselves, so they used Medicare funds to help pay for GME until a better model could be implemented. CMS continued to fund residency without any limitations ⁶. Then, in 1997, the Balanced Budget Act was passed. This caused the number of residents that could be paid for through DGME to be capped ⁶. 

Solutions

With the recent COVID-19 pandemic highlighting the need for a larger physician workforce, at the end of 2020, bipartisan congressional leaders added 1,000 new Medicare-supported GME positions that targeted rural and teaching hospitals ⁷. On March 18, 2021, Sens. Robert Menendez (D-N.J.) and John Boozman (R-Ark.) and Majority Leader Charles Schumer (D-N.Y.) introduced the Resident Physician Shortage Reduction Act of 2021, which will provide 14,000 new residency seats over the next seven years ⁷. These two advances were the first steps that ended the 25-year freeze on Medicare support for GME ⁷.  However, there is a shortage of 122,000 physicians expected by 2032 ⁶. Therefore, various avenues should be employed to combat the lack of physicians that our country is currently facing. Increasing our healthcare workforce (including nurses, PAs, medical assistants, etc.) can ensure we are better prepared to tackle another pandemic and our nation’s other health concerns ⁷.

In a commentary published in the Journal of the American Board of Family Medicine, Dr. Edwards-Johnson states, “There are not enough of us, we are underpaid, and suffer from burnout, but every day we find creative solutions to complex problems” ⁸. She emphasizes that family physicians are the crux of the healthcare system; they must first and foremost be invested in offering the best care to the “most vulnerable patients” before anything else ⁸.

She further delineates that the decline of physicians in this specialty is worrisome because of how preoccupied they are in matching with a specialty that will help pay off their loans ⁸. However, it is essential to acknowledge the residents that are not primarily invested in the economic gain or loss. Call it privilege or selflessness; they are more interested in the satisfaction that comes with the job. Knowing that they make just as much as someone like an entry-level accountant who has not undergone four extra years of rigorous schooling does not hold as much weight to them. This is especially true when you consider that patient gratification was one of the primary reasons they chose this career. And besides, they know they are still in training as a resident. It may just balance out once they earn the salary of a doctor in a few years.

Final Words

The matter of residency stipend has been a controversy for quite some time now. Increased federal funding for residency positions could alleviate the ongoing physician shortage and lead to a higher resident salary. However, some feel that federal funding could be used differently. While other residents simply do not sense the same urgency to increase resident wages. 

By Amreen Karim and Ifrah Ahmed