Most institutions sponsoring dermatology residencies receive funding from Medicare Part B for associated residency education costs. Medicare provides educational funding for residents based on the expected completion time for their first residency program. For primary care specialties such as pediatrics, internal medicine and family medicine, Medicare will fund three years of residency at 1.0 FTE levels. Medicare will also fund dermatology residency at 1.0 FTE for three years. However, if a resident starts or completes another residency prior to beginning dermatology residency, Medicare will reduce funding for the subsequent residency training to 0.5 FTE levels for part or all of the dermatology residency. That often leaves the dermatology residency program financially responsible for the remaining 0.5 FTE Medicare funding loss(es). That is why some institutions prohibit the selection of residents who have exceeded complete 1.0 FTE Medicare funding of their residency. In view of this reality, the best strategy for MS4s interested in a dermatology career is to exclusively apply for transitional or preliminary PGY1 years, since these PGY1 categories do not count against the full three year duration 1.0 FTE funding that Medicare provides for dermatology residencies. MS4s should also be aware that if they take a PGY1 transitional or preliminary year with internal medicine and then continue into a PGY2 year of that specialty, they have already used two years of their 1.0 FTE Medicare funding for internal medicine, and they may become less desirable to dermatology programs due to these funding issues (if they started dermatology residency after taking a PGY2 internal medicine year in , they will only receive one additional year of 1.0 FTE Medicare funding in dermatology residency, and during the last two years will receive 0.5 FTE Medicare funding).
For additional information please see Lori Mihalich-Levin’s well-researched document, “Medicare Payments for Graduate Medical Education:
What Every Medical Student, Resident, and Advisor Needs to Know,” http://www2.uic.edu/stud_orgs/prof/umsc/documents/medicaregme2013.pdf
The University of Texas Medical Branch Dermatology Interest Group (UTMB DIG) is a resource for medical students interested in Dermatology as well as for dermatologists and residents.
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