Demand for doctors continues to rise, but the supply has not been allowed to keep up. Fewer than half of med school applicants find a spot in the nation's 154 medical schools, and up to 10 percent of graduates won't get a residency (though a few more may be placed through the Supplemental Offer and Acceptance Program — SOAP). Hospitals are desperate for staff, small towns are begging for family doctors; yet, perfectly qualified doctors-in-waiting are locked out of the system.
Ninety-eight percent of all US medical residencies are funded by the federal government: 86 percent through Medicare and Medicaid and Veterans Affairs. Another 12 percent comes from state matching of federal Medicaid funds (funds confiscated from the people of those states, in the first place). Provisions set by Congress decide how many doctors can be trained annually, and effectively bars all others from practicing, even if they are highly qualified. You can't independently practice medicine in the United States without having first been matched with, and then completed, a three-to-seven year residency.
The 1997 Balanced Budget Act, responding to fears of rising costs due to a physician surplus, capped residency training funds at their 1997 level, where they remained for 25 years. A hospital already training 20 residents could keep its 20 residency slots, but the government would not allow it to hire or train more doctors. Nor could new donors or hospitals create new residency training programs. The total number of medical residents — 98,258 in 1997 — was virtually locked in. The government even shuttered medical schools (despite ample numbers of qualified applicants) and paid some hospitals not to train doctors.
thedailyeconomy.org
Ninety-eight percent of all US medical residencies are funded by the federal government: 86 percent through Medicare and Medicaid and Veterans Affairs. Another 12 percent comes from state matching of federal Medicaid funds (funds confiscated from the people of those states, in the first place). Provisions set by Congress decide how many doctors can be trained annually, and effectively bars all others from practicing, even if they are highly qualified. You can't independently practice medicine in the United States without having first been matched with, and then completed, a three-to-seven year residency.
The 1997 Balanced Budget Act, responding to fears of rising costs due to a physician surplus, capped residency training funds at their 1997 level, where they remained for 25 years. A hospital already training 20 residents could keep its 20 residency slots, but the government would not allow it to hire or train more doctors. Nor could new donors or hospitals create new residency training programs. The total number of medical residents — 98,258 in 1997 — was virtually locked in. The government even shuttered medical schools (despite ample numbers of qualified applicants) and paid some hospitals not to train doctors.

How Congress Created the Doctor Shortage | The Daily Economy
Why don't we train more doctors? Congress froze medical training in 1997, intentionally creating artificial scarcity.
