Why Expanding Residency Slots Will Not Solve the U.S. Physician Shortage?

Introduction

The U.S. physician shortage has become a recurring policy headline, and once again, the response feels familiar. Centers for Medicare & Medicaid Services has awarded 400 additional Medicare-supported residency slots, largely aimed at primary care and psychiatry, as part of a congressionally mandated expansion of graduate medical education.

At first glance, this appears like progress. More training positions should mean more doctors. But the persistence — and worsening — of access gaps raises a harder question: If expanding residency slots is the solution, why does the shortage keep growing?

1. What CMS Is Trying to Accomplish

The additional residency slots are part of a broader effort authorized under the Consolidated Appropriations Act, which requires Medicare-funded expansion of graduate medical education through 2026.

The intent is clear:

Reduce physician shortages
Support teaching hospitals
Channel more trainees into primary care and psychiatry

Approximately 62% of the newly awarded positions target those two specialties, and the slots are spread across nearly 100 hospitals nationwide. From a policy standpoint, this is a supply-side intervention — increasing the number of physicians entering the pipeline.

But supply alone has not solved the problem before.

2. Why Expanding Training Capacity Has Not Worked Historically

The physician shortage is often described as a pipeline problem. In reality, it is a distribution and retention problem.

For decades, the U.S. has trained highly skilled physicians who:

Cluster in metropolitan markets
Avoid under-resourced rural and safety-net settings
Exit primary care and psychiatry at high rates due to burnout and compensation gaps

Graduate medical education funding flows primarily to teaching hospitals, not to communities with the greatest unmet need. As a result, new physicians tend to practice near where they train — reinforcing geographic imbalances rather than correcting them.

Expanding slots without redesigning incentives risks scaling the same misalignment.

3. Primary Care and Psychiatry: Right Focus, Wrong Economics

Targeting primary care and psychiatry is directionally correct. These are among the most undersupplied and overburdened specialties in the U.S. healthcare system.

However, the core drivers pushing physicians away from these fields remain unchanged:

Reimbursement models that undervalue cognitive and longitudinal care
Administrative burden and documentation overload
Practice environments that emphasize volume over sustainability

Until payment models, staffing structures, and care delivery workflows evolve, additional residency slots may simply feed a system that continues to leak physicians faster than it retains them.

4. GME Funding Reflects Hospital Needs, Not Population Health

Medicare-funded GME was never designed as a population health tool. It was designed to support hospitals.

That distinction matters.

Residency slots are awarded to institutions, not regions. They strengthen academic centers but do not guarantee improved access in underserved communities. Without stronger mechanisms to align training with long-term practice location and specialty retention, workforce shortages persist — even as training capacity grows.

This is a system design issue, not a training capacity issue.

5. What Is Missing From the Policy Conversation

If the goal is durable access to care, especially in primary care and behavioral health, then workforce policy must go beyond training volume.

What is missing includes:

Payment reform that makes primary care and psychiatry financially viable long-term
Team-based care models that reduce physician burnout
Retention strategies, not just recruitment pipelines
Geographic and community-based incentives tied to practice sustainability

Without these elements, residency expansion risks becoming a necessary but insufficient intervention.

Final Thoughts: A Bigger Pipeline Will Not Fix a Broken System

CMS’s decision to expand residency slots reflects genuine concern about physician shortages. But training more doctors within the same misaligned system will not solve the access crisis.

The physician shortage is not fundamentally a training problem. It is a system design failure — rooted in how physicians are paid, where care is delivered, and how long clinicians are expected to endure unsustainable practice environments.

Until those structural issues are addressed, expanding residency slots may delay the problem — but it will not fix it.