With Central Oregon’s growing and aging population, the demand for health care services has never been higher. Yet, hospitals and clinics in more rural areas of the tri-county region are struggling to recruit enough primary care doctors and specialists.

That’s prompted the St. Charles Health System to explore the possibility of becoming a teaching hospital, in hopes of training more doctors willing to stay and practice in the area.

But that interest has run into a major roadblock. The federal government, which funds the majority of medical residency training in the United States, won’t pay for more than one resident to be trained at the Bend hospital.

“What it essentially means to us is if we choose to do this presently, we would be funding the cost of training these doctors,” said Dr. Jeff Absalon, chief physician executive at St. Charles.

Students who complete medical school are considered doctors, but they must undergo residency training to be able to practice on their own.

Residencies can last from three to five years, depending on the specialty, after which doctors can get their medical licenses.

Residency training, also known as graduate medical education, is funded primarily through the Medicare program, which pays for a certain number of residency slots at accredited teaching hospitals. But in 1997, Congress decided to stop paying for more residency slots, and froze individual hospitals at the number of spots each had in 1996. While there are some exceptions to that freeze, St. Charles has been capped at one resident per year.

That sole slot is being used to train family practice doctors in the St. Charles intensive care unit under a cooperative agreement with a residency program based in Klamath Falls.

“Physicians oftentimes are attracted to stay in or near communities where they trained,” Absalon said. “If we had a training program here, it’s likely that we would essentially have a pool of candidates that may have interest in staying in our local community.”

A bit of everything

Dr. Heidi Allen, a family medicine doctor, with St. Charles Family Care in Prineville, became interested in a rural practice when she did a rotation in a small community in Iowa during medical school. She opted for the Klamath Falls program for her residency and spent time in the St. Charles ICU as part of her training.

Allen says the opportunity to provide a wider variety of services in her day-to-day work attracted her to the rural practice model, and she might not have experienced that without her rural residency.

“We had a lot of resources in Klamath Falls, but we certainly did not have some of the specialty care that they would have in Portland,” she said. “You become a little more comfortable with managing some of the things yourself or maybe expanding your comfort zone a little bit because you don’t have those resources at your fingertips.”

She learned about the St. Charles system during her rotation in Bend, and that’s what eventually brought her to Prineville.

Studies show that 50 percent of residents practice within 100 miles of where they trained. Nationwide, 99 percent of residency positions are in urban teaching hospitals.

A study from the Association of American Medical Colleges in 2013 found that 70 percent of physicians who complete medical school and residency in Oregon remain in the state to practice. But most of the state’s residency slots are in Portland hospitals, and that has limited the number of new doctors who have been exposed to rural practice settings.

“I love big academic medical centers. I send complicated patients there all the time,” said Dr. Sarah Laiosa, another graduate of the Klamath Falls residency program, now working in Burns. “But somebody has to take care of the rest of the United States, and we know that people tend to stay where they trained.”

Like Allen, Laiosa relishes the opportunity to do a bit of everything. She sees patients in the hospital and in outpatient clinics. She’s the medical director for hospice and the health department, and the medical examiner for Harney County. She delivers babies and performs cesarean sections and other surgeries. She’s the medical director for a Medicaid managed care plan.

“If I got trained in academia, I wouldn’t be able to do this job,” she said. “You don’t teach family docs how to do C-sections as the primary surgeon in big academic medical institutions.”

Joint efforts

In 2015, a number of Oregon hospitals, including St. Charles, formed a consortium to help increase the number of rural residency slots in the state. The consortium members thought they would share the startup costs and initial development work for a group of hospitals that could train residents.

“In our naivete, we thought if we can help them develop, then the federal money kicks in from Medicare. So all we have to do is get them over that big hump of development, then they can be sustainable,” said Cathryn Cushing, executive director of the Oregon GME Consortium. “Well, not so much. There are so many difficulties with how that federal funding is allocated.”

To effectively teach residents, hospitals must be large enough to offer a range of different services and specialties that will adequately train doctors in a wide range of conditions and treatment. There are only five or six such hospitals in Oregon outside of Portland, Cushing said, and St. Charles is one of them.

“Bend is the perfect hospital to become a teaching hospital,” she said. “You have a location that would attract residents. You have a location that would spin residents off into more rural communities, plus great doctors over there at St. Charles and a great (hospital) system.”

Absalon said the hospital could envision a family practice residency program with eight to 12 doctors coming to train each year.

“Ideally, if we were going to have a program that had a number of residents, we would need to reset our cap. It’s fixed right now without an opportunity to increase,” Absalon said. “So that doesn’t exist today for us.”

Going it alone

Hospitals can choose to train more residents than their cap allows, but they get no help from Medicare to do so. Most of the larger teaching hospitals have more residents than Medicare residency slots. But with an estimated cost of $130,000 to $200,000 per resident per year, those costs would be prohibitive for smaller hospital systems stretched to their budgetary limits. Residents can generate some revenue for the hospital as they see patients, but that may not fully offset the overhead costs of operating a residency program.

Another member of the consortium, Mercy Medical Center in Roseburg, has decided to fund its own program.

“Medical education funding in our country doesn’t make a lot of sense,” said Dr. Chip Taylor, residency program director at Mercy Medical. “Residencies tend to be on the East Coast and in the urban areas, but that makes it very difficult for newer programs to be established.”

The hospital is recruiting its first class of eight residents for the fall of 2019, and plans to involve patients in the interview process.

“People want doctors that they can relate to, and sometimes, doctors, we speak doctor,” Taylor said. “But if you’re sitting across the table from someone who’s not a doc and they’re asking questions about your experiences … they’ll very quickly determine, is this somebody who I’d want to have for my doctor.”

The hope is that many of the doctors will join some of the local practices in Roseburg or head to other rural areas of the state. It’s unlikely that many other hospitals in Oregon will be able to follow the Mercy model, and ultimately, training more doctors in rural areas may depend on more than just the work of the consortium and its members.

“It’s a statewide problem, and it needs a statewide solution,” Cushing said. “We’re going to have to make some sort of decision about how are we going to train doctors outside of the Portland area.”

Potential fixes

States such as Washington, Colorado and New Mexico have found state funds to help train residents. Members of the consortium have been talking with state legislators about the possibility of similar efforts in Oregon. But the state is facing significant fiscal challenges and rising health care costs.

“There are bills probably every year at the federal level that try to make bigger changes, little changes to make it easier, but so far, none of them have passed,” Cushing said. “So we’re kind of stuck with what we’ve got here in Oregon.”

The Association of American Medical Colleges has been pushing for a solution at the federal level for years, arguing the cap on Medicare GME slots was always intended to be temporary.

“If you look at the testimony at the time, they said, ‘We’re going to freeze it for two years, and we’ll get back to it,’” said Dr. Janis Orlowski, the group’s chief health care officer. “Twenty-one years later, we’re still waiting.”

The group has submitted a legal opinion to federal officials suggesting the Centers for Medicare & Medicaid Services has the authority to lift the cap on hospitals with fewer than three residents. The previous administration rejected that notion, saying they would need Congressional approval to act. But the group is hoping the Trump administration might be more amenable.

“We’ve been saying unfreeze, unfreeze, unfreeze,” Orlowski said.

The group strongly backs the Resident Physician Shortage Act, a bill introduced last year with more than 100 co-sponsors in the House and the Senate, that would increase the number of Medicare-funded residency slots by 15,000 over five years. But the measure would be costly and is unlikely to pass in an election year.

There are other ways hospitals can get more Medicare residency slots. Hospitals that have never had residents can start new programs, and when hospitals with slots close, those slots are redistributed to other hospitals.

“There’s 20 to 30 slots that come up, and they tend to be redistributed through a series of rules, but they tend to favor rural or community (hospitals),” Orlowski said. “But that is not a strategy; it’s more can you get lucky.”

The demand for residency slots is also increasing. With a projected undersupply of doctors looming, medical schools, including Oregon Health & Science University, have increased class sizes by about 30 percent since 2002. And some 25 new medical schools have opened since the early 2000s. The new College of Osteopathic Medicine of the Pacific, Northwest in Lebanon, graduated its first 100 doctors in 2015.

In past years, there were more residencies available than U.S. medical school graduates, and some residency slots were filled by foreign-trained doctors. But Cushing said that gap is rapidly closing.

“Some of the international students are really highly qualified. They actually get picked over some of the less qualified students in the United States,” she said. “So we’re at that tipping point where we may not have enough slots to meet the needs of our students training in the U.S.”

Oregon is at that point. The state trains many more doctors than residents.

Starting a residency program at St. Charles could also have immediate benefits for patients in Central Oregon. Residents often can spend more time with patients than doctors practicing on their own, and the teaching environment spurs doctors and nurses to focus on evidenced-based care and best practices.

“It keeps everybody focused on best care,” Absalon said. “It brings an academic lens that I think can only benefit the medical community in general.”

Absalon stressed that St. Charles is not fully committed yet to a residency program, and it would take at least three years to get the program up and running. But for now, the hospital is in a holding pattern until the funding situation changes.

“If legislation changed and funding opportunities opened up, we would do a deeper dive and exploration to make a decision. It’s such a responsibility to train doctors and to train them well,” Absalon said. “So I can’t say we’ve made a decision to do it, but we have a strong interest.”

— Reporter: 541-633-2162, mhawryluk@bendbulletin.com