AAP News Vol. 1 No. 2 February 1985, p. 2
© 1985 American Academy of Pediatrics
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WASHINGTON UPDATE

• Manpower is sure to be one of the hottest items on the Academy's agenda in 1985. Two traditional funding mechanisms for graduate medical education, which Fellows have fought hard to support, are under renewed scrutiny and may well be squeezed or eliminated.

One of those mechanisms is the Medicare "pass through," which reimburses teaching hospitals for part of the cost of training physicians through direct and indirect formulas. Sen. David Durenberger (R-Minn.), chairman of the Senate Finance Committee's health subcommittee, already has introduced legislation to convert the $1 billion direct payment system into a state-run $900 million block grant. Meanwhile, President Reagan proposes to establish a $750 million block grant for the direct system, with no provision for future increases. He also wants to reduce the $2 billion indirect system to $1 billion over three years.