The DOs: Osteopathic Medicine in America, 2nd Ed.

10. In a Sea of Change

Having successfully resisted the AMA’s aggressive efforts to achieve a national amalgamation of MDs and DOs, the osteopathic profession now faced quite a different threat to its autonomy. Government and private health insurers were in the process of transforming the entire health care system in response to significant and unrestrained annual increases in the cost of providing health care. In the 1970s, leaders of the osteopathic profession did not anticipate the vast power these “third parties” would eventually wield, nor did they imagine the impact they would soon have on health services in general or on osteopathic medicine in particular. Not until the 1980s did the osteopathic profession recognize that it was in a different political and economic environment. Increasingly its energies were devoted to responding to national policies over which it had little control and which by the 1990s were posing considerable challenges to the viability of its institutions, most notably its hospitals and postdoctoral programs.

Costs and Controls

The passage of Medicare legislation in 1965 led to a significantly greater role of the federal government in financing health care. Millions of Americans over the age of sixty-five now received hospital benefits financed by the federal government. Those enrolled could also participate in a voluntary insurance program to cover physician visits. The passage of Medicaid legislation the same year established a federal-state partnership to provide both hospital and health care provider services to those in poverty, although eligibility, the size of payments to providers, and the range of benefits varied state by state.1

One immediate effect of these programs was increased utilization of providers and services by the covered populations. From the first years of its implementation the Medicare program needed vastly greater funding than initially projected. The original legislation mandated that payment to providers be cost-based and retrospective. This meant that the federal government, through its intermediaries and carriers, paid the fees and charges billed by hospitals and physicians with little regard to the appropriateness or the value of the services provided. The Medicare reimbursement formula allowed hospitals to incorporate into their patients’ bills capital costs for modernizing or expanding hospital facilities, and this stimulated hospitals to build and grow irrespective of the plans of other institutions or of the needs of the community. Lastly, Medicare would reimburse hospitals for the direct and indirect costs of internship and residency training.2

For decades private insurers had used cost-based, retrospective reimbursement methods. Insurers like Blue Cross routinely paid physician fees as long as they fell below the ceiling of what was usual and customary for their specialty and their geographic area. The system discouraged competition among providers. As physicians increased their fees, insurers responded by raising their premiums.3 The number and percentage of Americans covered by this type of private health insurance increased rapidly beginning in the 1950s. Either employees collectively bargained for these benefits or employers offered them as incentives to retain or attract labor. As those insured no longer paid a significant portion of their health care bills, they had little incentive to seek out lower-cost providers, limit their use of services, or challenge high fees. However, as companies’ health insurance costs spiraled, they found an increasing percentage of their revenues being devoted to paying for health care. Business as well as government began looking for ways to restrain this growth.4

In the 1970s, most efforts to control these costs took the form of greater regulation and oversight. From 1971 to 1974, the federal government put wage and price controls into place to limit annual increases in hospital expenses and physician fees. This proved to be only a stopgap.5 In 1972, Congress mandated that Professional Standards Review Organizations (PSROs) be established on the local and state levels throughout the country. These agencies, which had their origin in state government initiatives, were charged with promoting “the effective, efficient, and economical delivery of health care services of proper quality.” Focusing on the beneficiaries of the Medicare and Medicaid programs, these agencies, made up of physicians and others, sought ways to reduce the average length of patients’ hospitalizations.6

In 1974, Congress passed the National Health Planning and Resource Development Act, which created local and state health systems agencies (HSAs) to prevent unnecessary expenditures on hospital facilities. HSAs required any hospital to justify its desired expansion based upon not only its special needs but upon what services neighboring and competing institutions rendered. If successful in the external review process, a hospital would be issued a “Certificate of Need” and the institution could then go forward with its plans. Congress initiated these actions in a legislative climate in which sentiment for national health insurance was growing, and some proponents believed that these measures constituted the initial steps in accomplishing that goal.7

Parity and Inclusion

The American Osteopathic Association historically had held significantly different positions on proposed federal health legislation than those embraced by the American Medical Association. For much of the twentieth century, the AMA tried to convince legislators, whatever the content of the proposals and whether or not the association supported them, that DOs were unqualified physicians and that osteopathic schools and hospitals should therefore be excluded from legislative consideration and participation in any programs. While the AMA was traditionally opposed to the federal government’s financing or regulating health care services, the AOA was more accepting of federal involvement and took much more moderate positions than did the AMA. To organized osteopathy, the principal concern, whatever the legislation, was not the relative desirability of federal involvement but that DOs have parity with MDs.8 As legislators proposed new regulatory agencies, the DOs responded as they had traditionally. In their congressional testimony they expressed their concerns over certain provisions in pending bills, pledged to help the programs be successful, and worked to ensure that in whatever bills were enacted DOs would be treated exactly the same as MDs. However, the legislation of the 1970s raised considerable challenges.

With respect to PSROs, the AOA urged its members to monitor developments “to assure the autonomy of the osteopathic profession.”9 As rules were being crafted to implement this program, AOA officials met with representatives of the US. Department of Health, Education, and Welfare to ensure DO participation in local and state agencies and to obtain guarantees that, in states with significant numbers of osteopathic physicians, DOs would be responsible for reviewing the practice patterns of other DOs. The AOA also insisted on and won a federal contract to develop model osteopathic hospital admission criteria for use by local PSROs.10 After these local and state agencies became operational, the AOA successfully lobbied the Bureau of Quality Assurance to allow DOs to secure seats on PSRO governing bodies wherever proper representation was lacking. At the AOA’s behest, DOs were also appointed to the National Professional Standards Review Council.11

The federal authorization of Health Systems Agencies in 1974 posed similar challenges to the osteopathic profession. Even prior to the act, the AOA had been concerned about discriminatory treatment of DO institutions. Twenty-two states had already enacted “certificate of need legislation,” but only two states’ laws assured that expansion of osteopathic hospitals would be based only upon the need for osteopathic services and facilities in a community. In other states and under the new federal act no distinctions were made between MD and DO institutions. Thus, protection was given neither to patients who preferred osteopathic care nor to osteopathic undergraduate and graduate student training needs.12 However, the profession successfully lobbied for changes in a 1979 law revising the National Health Planning and Resources Development Act. As a consequence, wording in the final rules required that the need for services and facilities for osteopathic patients and physicians would be “considered.” Though the regulatory language was weak, it did provide osteopathic institutions with a means of appealing denials of desired capital improvements." In addition, state osteopathic associations continued to press their respective legislatures for similar or stronger language in their statutes governing these planning agencies. Successful efforts to establish new hospitals in Tennessee and Florida and approval of the building plans of existing osteopathic hospitals despite opposition of competing MD institutions and local planning agencies would be heralded by the profession.14

By the early 1980s legislators recognized that regulatory efforts were not controlling costs. In 1970 the total national expenditures for health care had been $73 billion. By 1980 this figure had more than tripled to $247 billion. During that same period, Medicare and Medicaid costs alone nearly quintupled, from $10.6 to $52 billion. Health care expenditures overall represented almost 10 percent of the gross national product.15 The

Reagan administration, in response, implemented new initiatives to restrain the rate of growth in Medicare and Medicaid federal spending. Initially, these efforts focused on hospitals. Professional Review Organizations (PROs), which replaced the PSROs, were intended to provide greater oversight of the cost and quality of medical care paid for with federal dollars.16 In 1983, Congress authorized a new system of Medicare payment to hospitals, based upon diagnostic related groups (DRGs). At the time of hospital admission, each patient would be assessed and categorized by these DRG codes. Hospitals would be paid a flat fee based on diagnosis. If the hospital’s cost of caring for a patient was less than the standard reimbursement, the institution pocketed the savings. Conversely, if the cost of care was greater than the standard reimbursement, the institution absorbed the costs. Thus, responsibility for efficient use of services shifted to the hospitals.17 In addition, Medicare and Medicaid administrators established policies that denied reimbursement for inpatient care that could just as safely and effectively be provided on an outpatient basis. Because fewer patients were being admitted to hospitals and with those admitted being discharged sooner, the competition between institutions to fill beds became more intense.18

The private sector was also moving away from the retrospective feefor-service payment system. In 1973, Congress passed the Health Maintenance Organization (HMO) Act. Based upon models such as the KaiserPermanente Plan in California, the HMO delivered health care services to members for a prepaid premium. The amount of the premium for participants would potentially be less than the overall costs of indemnity plans yet cover a similar range of services. Like hospitals under the DRG system, HMOs would bear the financial risks for the care they delivered. To reduce the frequency of serious disease, HMOs emphasized preventive services and encouraged healthy lifestyle behaviors. The patient’s primary care physician was to be the HMO’s gatekeeper, ideally reducing unnecessary testing and referring patients to costly specialists only when appropriate.19

The act as originally crafted by Congress lacked adequate incentives to encourage the development of HMOs. Not until the 1980s and 1990s, as cost reduction pressures mounted, did they grow rapidly. Other alternative organizational forms of what was to be called “managed care” soon followed, including independent practice associations (IPAS), preferred provider organizations (PPOs), and physician-hospital organizations (PHOs). As competition between physicians and practice groups increased, private insurers gained greater leverage and power to limit reimbursement to providers.20 Because DOs, more than MDs, practiced in nonurban, lowerpopulation areas, managed care did not initially affect many osteopathic physicians. However, by 2000, 74 percent of DOs responding to a national survey reported having managed care contracts.21

As these changes took place and particularly as new review and policy setting agencies were created to oversee physician reimbursement, the AOA worked to insure participation in programs and representation in decision making. In the early eighties, the AOA negotiated with the Health Care Financing Administration (HCFA), which administered the Medicare program, to include osteopathic manipulative treatment in the national coding system. In 1988, the association lobbied to require the Harvard researchers working under contract with HCFA to include distinctly osteopathic services in the relative value scale (RVS) they were developing. This project, which assigned values to a wide variety of physician services, would establish the basis for how much physicians would be paid for treatingMedicare patients.22 Inclusion in decision making, however, was sometimes a hard fought struggle. The Physician Payment Review Commission (PPRC), established in 1985 by Congress to advise it on Medicare reimbursement of practitioners, had MD representation but no osteopathic physician members for several years. After an intense campaign of letter writing and lobbying, the first DO representative was appointed to the commission in 1995.23

Given the increasing stream of health-related federal legislation, the capacity of the small AOA office in Washington, D.C., to scrutinize every pending bill became a challenge. In 1990, the profession was shocked when it learned that a provision in the just-passed Omnibus Budget Reconciliation Act mandated that, by 1995, only physicians certified by MD specialty boards would be eligible to treat Medicaid-supported pregnant women and children younger than twenty-one. Neither the bill’s congressional sponsors nor their staffs intended to exclude DOs; they simply did not know that the osteopathic profession maintained its own specialty boards. Once the bill became law, however, Congress did not pass remedial legislation to correct the error until 1996. F ortunately for DO specialists, the Department of Health and Human Services had agreed to delay the implementation of this provision of the act. As a consequence of that particular lapse in AOA oversight, the association significantly expanded its Washington staff and increased its political presence.24

While Congress and federal agencies were generally supportive of equal treatment of DOs and MDs, the AOA found evidence that managed care plans and private insurers discriminated against osteopathic physicians. Some managed care entities refused to hire or contract with DOs unless they had MD specialty board certification. However, in many cases, the AOA found they were able to change existing prohibitions or restrictions simply by providing information to hospitals and managed care organizations on the comparable standards and quality of osteopathic postgraduate training. In other cases, the AOA supported lawsuits brought by individual or groups of DOs to challenge policies making invidious distinctions. State osteopathic associations also lobbied in their respective legislatures for the passage of laws that would prevent hospitals or insurers from discriminating against DOs on the basis of degree and type of specialty board certification.25

Many DOs who employed osteopathic manipulative treatment in their practice found it difficult to convince private insurers to adequately compensate them for their services. Some insurers tried to place arbitrary limits on the number of treatments, to lump OMT with nonphysician interventions rendered by chiropractors and physical therapists, or not to pay them anything above a standard office visit that did not include OMT. As these reimbursement problems varied from plan to plan and among assorted jurisdictions and practitioners, the AOA and state osteopathic societies faced a continuing challenge in addressing these problems.26

The Endangered Osteopathic Hospital

The passage of Medicare directly benefited osteopathic hospitals, and many flourished into the 1970s and early 1980s. In 1975, data collected by the American Osteopathic Hospital Association (AOHA) revealed that osteopathic hospitals provided more than six million days of inpatient care and almost three million outpatient visits annually. Although the average length of stay was shorter by the mid 1970s, outpatient visits were increasing and many hospitals were operating in the black. During the first six months of 1980, revenues at osteopathic hospitals increased by an average of 13 percent over those from the same period the previous year.27 Despite these numbers, leaders within the profession were becoming anxious about the long-term prospects of their hospitals because of diminishing support by osteopathic physicians and fundamental changes in the methods of payment for hospital care.

Before the 1950s, most osteopathic hospitals had been established to serve the practice needs of a small number of community practitioners. In the mid 1960s, as state medical associations dropped the “cultist” label from DOs and removed any restrictions on their members who associated with osteopathic physicians, DOs were increasingly able to treat patients at traditional allopathic institutions. In the 1970s and 1980s as allopathic hospitals faced a need to fill beds, the DOs, particularly family practitioners, found themselves actively courted by such institutions. These recruitment efforts dismayed osteopathic hospital administrators, who counted on these physicians to keep their own patient census figures high. Compounding the problem faced by osteopathic hospitals, entrenched DO specialists, fearing competition, denied privileges at their particular institutions to other qualified and comparably trained DOs. These shutout osteopathic specialists reacted by joining nearby allopathic institutions, bringing their patient base with them. As a consequence, osteopathic hospitals suffered.28

Both the AOA and the American Osteopathic Hospital Association established working groups to study the problem of decreasing utilization. In 1983, after analyzing questionnaires completed by more than nine hundred osteopathic generalists and specialists and approximately sixty hospital administrators, the Special Committee to Study the Utilization of Osteopathic Hospitals by DOs issued a report. The committee declared that DO general practitioners needed to be accorded the respect and sup port they deserved from their hospitals and their DO specialist colleagues, that the various sectors of the osteopathic community must communicate more effectively with each other and the public, that DOs must be more loyal to their profession, and that hospitals must upgrade their facilities as well as their support services for DOs.29

Some osteopathic hospitals had been able to obtain funding to expand their facilities. In 1978, fifty-six institutions were initiating construction programs that would both add and replace beds. From 1973 through 1983, the number of AOA-accredited osteopathic hospitals with two hundred or more beds increased from twenty-seven to forty-five. But even with expansion, few osteopathic hospitals could match the range or quality of services that could be provided by their much larger, neighboring, and primarily MD-staffed competitors.3O

With the introduction of DRGs, the patient census of osteopathic hospitals began to decline steadily. In the late 1980s and 1990s cuts in government reimbursement forced hospitals to adopt greater cost-cutting methods, including laying off nurses and ancillary personnel. In addition, administrators of several osteopathic hospitals found it difficult to secure managed care contracts and believed that their institutions were the victims of either ignorance or discrimination on the part of the directors of these plans. Osteopathic hospitals were becoming financially distressed.31

The location of many of the profession’s hospitals was problematic. Osteopathic facilities in cities, such as Detroit, Philadelphia, and Chicago, experienced the effects of demographic change. With middle-class residents moving to the suburbs, the poor became the principal group served by these institutions. Historically, urban osteopathic hospitals relied on the higher rates of reimbursement they received for privately insured patients to compensate for lower-paying government programs covering the poor. As the middle class left the city, however, hospitals could no longer count on private insurers to balance the cost of providing for Medicaidfunded or indigent patients. Rural osteopathic hospitals were also disadvantaged. Under the DRG system they received significantly less reimbursement for services rendered than did their urban counterparts. Small rural osteopathic facilities were unable to secure investment capital to make improvements to attract or retain both physicians and patients. Only osteopathic hospitals located in affluent suburbs weathered the changes generally well.32

Not surprisingly, a significant number of osteopathic hospitals closed their doors or ceased to be general inpatient facilities. While it is difficult to trace the fate of all osteopathic hospitals, one important indicator of change is the experience of those institutions accredited by the American Osteopathic Association. The AOA accredited 127 hospitals in 1974. Of these, 96 remained accredited in 1989, but only 59 were still on the rolls in 1999.33 Some of the once accredited hospitals closed. Others became outpatient facilities, residential treatment centers, or satellite hospitals for larger allopathic institutions}4

Some positive developments did emerge from these losses, however. The boards of some of the nonprofit osteopathic hospitals that sold their facilities to multihospital chains used all or most of the proceeds of these sales to create private foundations that would contribute to osteopathic education and other related activities. In 2002, the largest of these, the Osteopathic Heritage Foundation of Columbus, funded principally out of the sale of three Ohio hospitals, had assets exceeding $200 million.35 In addition, the staff of many osteopathic hospitals that consolidated with or were acquired by larger allopathic hospitals insisted on retaining their osteopathic identity. Often, the acquiring institution agreed to become accredited by the AOA in addition to the allopathic Joint Commission on the Accreditation of Healthcare Organizations. As a consequence, in 1999 the Healthcare Facilities Accreditation Program of the American Osteopathic Association accredited 73 mixed staff hospitals in addition to traditionally osteopathic hospitals, making for a total of 132 institutions in its program, five more than in 1974.36 Over that twenty-five-year period, the total number of recorded beds and the average size of the hospitals accredited by the AOA actually increased. In 1974, the total number of recorded beds was 18,725, an average of 144 beds per institution; in 1999, the number of recorded beds was 26,875, an average of 203 beds per hospital.37 Though AOA-accredited mixed-staff hospitals were not specifically osteopathic, they were as a group larger, well-equipped, and offered possibilities for developing new practice and teaching opportunities for the osteopathic profession.

Internship and Residency Shortages

In the 1950s, there was a widening difference between the allopathic and osteopathic medical professions over the substance of their graduates’ first year of postdoctoral education. The number of MD rotating internships

(that is, programs in which interns divide their time between several major departments) steadily declined in favor of what were called “mixed” or “straight” internships, which placed emphasis on a specialty. For all practical purposes these latter programs constituted the first year of residency training. In the 1964–65 academic year, 50 percent of all MD postgraduate-year-one (PGY-1) positions were rotating internships; by 1973–74, the percentage had dropped to 19.38 The mixed and particularly the straightinternship allowed the graduate who wanted to specialize to spend more time and thus gain greater experience and skills in his or her chosen field. All AOA-approved PGY-1 programs, on the other hand, whether they were in osteopathic or federal hospitals, continued to be rotating internships. Osteopathic interns had to spend three months in both internal medicine and general surgery and one month in both obstetrics/ gynecology and general practice. Students also gained experience in anesthesiology, pathology, pediatrics, and radiology. Continuing AOA support of the rotating internship was rooted in the belief that whether the DO became a primary care practitioner or a specialist, he or she must be prepared to take care of the “entire patient.”39 In the 1970s, with the establishment of so many new osteopathic colleges, some DOs questioned the capacity of osteopathic hospitals to provide sufficient numbers of internships to meet the expected demand. In 1975, the AOA House of Delegates adopted guidelines submitted by the association’s Bureau of Professional Education which would allow “consortia arrangements” wherein two or more smaller osteopathic hospitals could pool their resources to become eligible for interns. Two years later, the House adopted an amended format for the elective rotation of interns through departments of hospitals not accredited by the AOA and for the first time approved the utilization of joint-staff or combined-staff hospitals that were willing to apply for AOA accreditation. These institutions were required to have an adequate DO population in four major departments and to meet other specific criteria. As a result of these changes as well as the establishment of a new formula apportioning internships more on the basis of outpatient services than bed capacity, the AOA set in motion a significant expansion in the number of available internships.40 Nevertheless, the marked decline in the number of traditional osteopathic teaching hospitals in the 1980s and 1990s directly affected the profession’s ability to keep pace in providing PGY-1 positions for all of its graduates. The AOA’s continued commitment to developing new schools and its encouragement of existing private colleges to expand the size of their student bodies greatly exacerbated the problem. Since the AOA did not wish to restrict growth on the undergraduate level, it labored even more intently to increase osteopathic postgraduate educational opportunities.

In 1981, the AOA Task Force on Graduate Osteopathic Medical Education issued a report based on a two-year study funded by the W K. Kellogg Foundation. Having projected the anticipated rise in D0 graduates through 1989, the task force made five recommendations to increase the number of postdoctoral programs under osteopathic auspices: (1) osteopathic hospitals not currently offering internship or residency programs should be given assistance to initiate programs; (2) more mixed-staff hospitals should be encouraged to develop such programs; (3) the number of internships and residencies in existing institutions must be expanded; (4) the criteria by which the number of internship or residency slots was determined needed to be changed; and (5) the AOA should establish a feasibility study to evaluate the efficiency of creating graduate medical education regional consortia. All of these approaches were pursued.41

In the mid 1980s the AOA changed its accreditation standards to foster the development of osteopathic college-based programs that could sponsor hospital internships already approved by the allopathic Accreditation Council for Graduate Medical Education (AC GME). The ACGME, which operated under several parent medical groups, including the AMA, had replaced the AMA as the only organization involved in the accreditation of allopathic residencies.42 Some hospitals staffed primarily by MDs had ACGME-approved PGY-1 positions that had been funded but not filled. Osteopathic colleges approached these hospitals, promoting their graduates as candidates. Many hospitals were pleased that osteopathic colleges could fill these available slots, as they preferred American DOs to international medical graduates (IMGs). Allopathic hospitals met AOA curricular requirements by making small adjustments in the first year of existing family medicine residency or transitional internships. With both the AOA and ACGME independently approving these programs they became known as “dual-accredited internships” By 1997, sixty ACGMEaccredited institutions were participating in AOA-approved graduate medical education.43 As a consequence, DOs expanded their internship base. Between the 1984–85 and 1996–97 academic years, the total number of funded AOA–approved internships jumped from slightly over 1,300 to 1,878—an increase of 44 percent. In l984–85 there were 200 more new DO graduates than funded internships; by 1989–90, there were more funded internships than graduates.44

Although still committed to the rationale behind the rotating internship, the AOA in 1990 finally responded to students who did not want to be family physicians. It approved the development of “specialty track” internships, which served as the first year of residency, and “special emphasis” internships, which did not reduce the length of residency training but provided the postgraduate with more grounding in the respective specialty field. By 2000, 30 percent of DOs in AOA-approved internships were in one or the other of these alternative tracks. While the AOA hoped the dual-accredited as well as the new specialty-oriented internship programs would resolve its PGY-1 shortages, by 1994–95 there once again were more graduates than funded AOA-approved internship slots, and this trend would continue thereafter.45

A similar problem existed with respect to osteopathic residency training. By the 1970s a steadily growing percentage of DOs desired residencies, many in primary care areas. The field of “family medicine,” which was superseding general practice, required postdoctoral education past the internship. As demand for residency training increased, and with more ACGME programs, not dual-accredited, opening their doors to DOs, leaders within the AOA saw the necessity of having osteopathic and mixed-staff hospitals develop new positions. In the 1980s and 1990s, the AOA approved an impressive number of funded osteopathic residency slots (PGY-2 and above) in solely or dually accredited programs. DOs in AOA-approved osteopathic residencies increased from 699 in 1980–81 to 1,242 in 1985–86, 1,551 in 1990–91, and 2,606 in 1995–96. The specialty fields which attracted the most DO residents were family medicine, emergency medicine, internal medicine, general surgery, obstetrics/gynecology, and orthopedic surgery. Nevertheless, the positions created could not accommodate the needs of all osteopathic graduates. Though the AOA published annual statistics showing many more approved positions than positions filled, a significant percentage of these approved slots were not funded and so existed only on paper.46

As a result of these chronic shortages an increasing number and percentage of newly graduating DOs bypassed the AOA intern matching program and elected to enter allopathic first-year residency programs that were not dually approved.47 MD trainers’ experience with the performance of DOs in such programs spread the good reputation of osteopathic graduates as a group. Consequently, ACGME residency program directors, anxious to fill their positions with qualified candidates, dramatically increased the number of mailings to and solicitations of DO students. These efforts were successful. In 1995–96, of the 5,591 DOs in residency training programs, 3,333, or 60 percent, were in either solely or dually accredited ACGME programs. Although a significant number of these DOs had applied for and received AOA approval for such training, a growing number of DOs did not seek the AOA’s blessing.48 Under AOA rules DOs who did not first complete an approved osteopathic internship could not obtain any credit for ACGME residency training toward certification by an osteopathic specialty board. However, DOs completing ACGME residences but lacking an AOA-approved internship were still eligible for and obtained MD specialty board certification. Though these MD-boarded specialists were licensed as DOs, they had little incentive or desire to participate further in the osteopathic community.

As the number of DOs who avoided AOA-approved PGY-1 training grew, the AOA recognized the long-term implications for its membership of maintaining its existing postgraduate education policies. In 1996, the AOA created a mechanism by which DOs in PGY-1 programs solely accredited by the ACGME could petition the AOA for approval of their training. This first year of graduate medical education had to meet essential requirements for the traditional rotating internship and the DO had to document a personal, financial, or legal hardship that explained why the petitioner did not participate in an AOA-accredited program.49 In 2000, the AOA liberalized its policy further, allowing individual DOs to receive retroactive approval of their ACGME PGY-1 year, thus permitting consideration and approval of their subsequent ACGME residency training. This policy change permitted those DOs the opportunity of securing AOA specialty board certification under rules passed in 1999. In addition, in 2000 the AOA board approved a six-year pilot program that offered approval for the PGY-1 “transitional year” portion of ACGME residency programs that were not dual-accredited but which nevertheless fulfilled the essential requirements of a standard AOA-approved rotating internship. This last change, though it came with restrictions, opened the door wider for senior DO students to sign letters of agreement for solely accredited ACGME training without incurring AOA or osteopathic licensure board penalties for bypassing the AOA intern matching program.50

With ACGME programs actively recruiting DO students and the AOA changing its rules to loosen restrictions on their taking solely accredited

ACGME training upon receiving their degree, traditional osteopathic postdoctoral facilities had to develop more-competitive programs if they were to retain a viable number of their graduates. Historically, most osteopathic hospitals operated internships and residencies with little, if any, academic connection to osteopathic medical schools–in contrast to many allopathic programs. ACGME residencies offered their postgraduates a structured, didactic educational curriculum, while osteopathic hospitals were often found wanting in this regard. Unlike ACGME programs, which paid the physician trainers for their services, solely accredited AOA program faculty usually served as unpaid volunteers. Osteopathic educational leaders argued that significant reforms were necessary.51

In 1989, the Michigan State University College of Osteopathic Medicine (MSU-COM) established the Consortium for Osteopathic Graduate Medical Education and Training (COGMET). Thirteen Michigan osteopathic hospitals joined with the college through a formal agreement to create a partnership whereby the college would take an active role in enhancing the educational programs and standards within participating hospitals. The goal was to create a seamless and structured curriculum from the first day of medical school through the internship and the residency. The hospitals provided the funding and the college offered in-kind educational services.52 The Ohio University College of Osteopathic Medicine (OU-COM) soon followed suit, establishing five geographical Centers for Regional Education (CORE), most consisting of multiple hospitals. In the CORE system both OU-COM and the hospitals made significant financial contributions for programmatic development, interactive technology, and the hiring of physician administrators and support staff.53 Both COGMET and the CORE proved highly successful, not only at retaining their respective students as interns and residents, but in attracting large numbers of DO graduates from other colleges. Their innovative structures and programs drew the attention of educators in other osteopathic schools and in allopathic institutions as well.

In 1995 , the AOA, in a bold move, decided that all of its postdoctoral programs should be organized on a consortium basis. It adopted the means to accredit these consortia which it called Osteopathic Postdoctoral Training Institutions (OPTIs). Under the program, any osteopathic or other hospital offering AOA-approved internships and residencies had to become a member of an OPTI. By February 2003, seventeen individual OPTIs had been established, representing all of the fully accredited schools and consisting of all traditional osteopathic teaching hospitals as well as a number of larger allopathic or mixed-staff facilities. Most of these OPTIs have just started their operations and they vary widely in their governance and financing. A small number of OPTIs consist of one or more schools with several osteopathic hospital partners, however, most OPTIs in states or regions without traditional osteopathic hospitals have started from scratch, with the colleges taking the lead in building alliances with allopathic or mixed-staff institutions. Most OPTIs are currently small and can provide only a fraction of the number of internship and residency slots needed by the graduates of the osteopathic college or colleges participating in that OPTI.54 Consequently, there has been a steady increase in the percentage of osteopathic graduates entering solely accredited ACGME programs.

Furthermore, the challenge of providing a sufficient number of highquality postdoctoral positions under AOA auspices is becoming more difficult as the federal government changes the basis upon which it will fund graduate medical education. Under the provisions of the Balanced Budget Act of 1997, Medicare-based graduate medical education funding was drastically cut. But the most significant feature of the legislation was that it froze the number of fundable MD and DO internships and residencies in each hospital to those filled in the prior year, as a way of eliminating excess positions. No distinction was made between the internship-andresidency-starved traditional osteopathic program and the postgraduate program surpluses generally found in allopathic medicine.55 As a result, unless Congress makes significant changes in the law to accommodate the special circumstances and needs of osteopathic medicine, the OPTI program can only flourish if it finds alternative and additional means to finance existing positions in currently affiliated hospitals, attracts community hospitals that under the Balanced Budget Act are still eligible to create new federally funded graduate programs, and affiliates with a far larger number of hospitals with ACGME programs to create substantially more dual-accredited programs.56

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