On September 22, 2000, GNYHA wrote to Antonia Novello, M.D., Commissioner of the New York State Department of Health (DOH), regarding revisions to the Professional Educational Supplemental Pool, commonly known as the graduate medical education (GME) incentive pool. The GME incentive pool, which was initially authorized in the Health Care Reform Act (HCRA) of 1996, was continued in a modified version in HCRA 2000. GNYHA stated in its letter that after three years of implementation of the HCRA 1996 GME incentive pool, the reauthorization and modification contained in HCRA 2000 offers DOH an opportunity to retain the best parts of the incentive pool program and modify or eliminate those components that have proved administratively and programmatically difficult for both teaching institutions and DOH staff.

GNYHA noted in its letter that only two years of GME incentive pool payments have been distributed at this point, and none of the third-year awards (that is, those attributable to 1999 pool collections) is currently scheduled to be distributed before some time in the next few months. This distribution schedule will coincide with the completion of the State's collection of the fourth year of GME private payer pool contributions, which make up the funding source of the GME incentive pool. GNYHA expressed general concern that available State pool dollars, whether from the GME incentive pool or the Community Health Care Conversion Demonstration Project, have lagged in their distribution to eligible hospitals.

GNYHA's Recommendations: In its letter, GNYHA offered both administrative and programmatic recommendations for restructuring the incentive pool. In the administrative area, GNYHA recommended that DOH staff make a concerted effort to ensure that the survey distribution, collection, and funding process take no more than six months in total and be completed by the early fall, and that DOH implement an interim payment provision for some significant portion of each hospital's total award. In addition, GNYHA encouraged DOH to avoid significant and burdensome new data collection requirements in restructuring the incentive pool.

In addition to making specific recommendations regarding individual elements of the programmatic design of the HCRA 2000 GME incentive pool, GNYHA also made two general recommendations. First, the weight associated with the quality indicator should be maintained and the remaining objectives should be weighted equally, or about equally, and no particular policy objectives and associated weights should be separately carved out. In addition, GNYHA recommended that each of the policy objectives have two separate reward components -- one reflecting achievement of or maintenance of a minimum threshold goal, and the other reflecting incremental further achievement toward a higher-level goal.