> The law that created Medicare specifically stated it was to subsidize residencies “until the community undertakes to bear such education costs in some other w

> The law that created Medicare specifically stated it was to subsidize residencies “until the community undertakes to bear such education costs in some other way.” Understandably, no one has stepped up to replace the federal government gravy train. It seems like you don't want Medicare to be responsible for the funding of residency programs, and you'll get no disagreement from me on that point. In an ideal world, this would not come Medicare, because Medicare is the least efficient funding source for - well, pretty much anything. But the fact remains that residency programs are not a profit center for hospitals, and hospitals cannot absorb an extra $9.8 billion/year just to train residents. And there's no other funding source for these programs at most hospitals that doesn't ultimately make its way back to the patient in some form. It's also worth mentioning that the Balanced Budget Act capped Medicare's funding for residency programs specifically to reduce the number of residency slots available and avoid an "oversupply" of doctors. It's not that the AAMC is looking for free money so that they can keep the number of physicians artificially low, as you're implying; the external funding is what drove the increase in the number of physicians in the first place. If you want residency programs to be funded by someone other than Medicare, that's fine, but just realize that the free-market would reach equilibrium at even fewer residency slots than we have today.