Medical Residents File Lawsuit Over Matching System

The junior doctors of the nation’s hospitals took aim at the heart of the American medical establishment Tuesday, alleging in a class-action lawsuit that the system that matches medical school graduates with residency programs violates federal antitrust law.

Filed in federal court on behalf of 200,000 medical residents, the lawsuit charges that seven medical associations and 35 teaching hospitals have “illegally contracted, combined and conspired among themselves” to rig the system that determines where medical school graduates will train, how much they will be paid and how many hours they will work.

A lawyer for the residents said that if their lawsuit succeeds in winning monetary damages and a say in how the National Resident Matching Program works, patient care, as well as residents’ working conditions, would improve.

Under the program, virtually all students in their final year of medical school--23,459 this year--designate the city, the hospital and the specialty they would like to train in for the next three to eight years. After a series of applications and interviews, their choices are computer-coordinated with those of 674 teaching hospitals nationwide. Every March the students’ fate is sealed with a letter informing them of their match.

Participating hospitals share information about their salaries and programs, but residents cannot discuss wages and working conditions or contest their match. This anti-competitive system keeps wages artificially low and gives students little choice but to work in a system where 100-hour weeks are common, said Chicago attorney Michael J. Freed, one of the lawyers representing the residents.

A spokeswoman for one of the defendants, the Assn. of American Medical Colleges, said officials there would have no comment on the lawsuit until they had read it.

The association manages the matching program, said Retha Sherrod, adding that before it was established in 1952, there was “utter chaos.”

“There was no process. The medical students wanted a system to indicate their preference,” Sherrod said.

Defenders of the system have long argued that significantly changing the way residents are trained and paid would overburden staff physicians and other hospital employees while increasing overall health-care costs.

Freed disputed the cost argument, saying that medical residents’ salaries, which range from less than $35,000 to $39,000 in the first year, generally account for only 3% of a hospital’s budget.

But even if winning the lawsuit does result in increased costs, Freed added, the current system “is indefensible.”

“Everything [about the program] is designed to eliminate any choice for the resident,” he said.

Dr. Paul Jung, a lead plaintiff, said he hopes the lawsuit will “change the system so residents will have more of a say in their working conditions.... Residents need to be part of the decision-making process.”

Jung, who said he was very happy with his residency at MetroHealth Medical Center in Cleveland, is now a health policy research fellow at Johns Hopkins University in Baltimore, “where residencies were invented in 1888.”

He said the inventors “would be appalled” by the system, which “treats residents like cheap labor.”

Other defendants include the American Medical Assn., the American Hospital Assn. and, among the teaching hospitals, Stanford Hospital and Clinics and Cedars-Sinai Medical Center in Los Angeles.

A spokeswoman for Cedars-Sinai said late Tuesday that she was not aware of the lawsuit.