Unsupervised procedures by surgical trainees: a windfall for private insurance at the expense of graduate medical education.

Background: Surgical faculty cannot always be present while trainees perform minor procedures. Fees are not obtained for these unsupervised services because Medicare rules do not allow residents and fellows to bill. Medicare already supplements hospitals via medical education funds and thus reimbursement for trainee services would constitute double billing. Private insurance companies, however, do not supplement trainees' salaries and thus benefit when they are not charged for these procedures. The objective is to determine whether significant revenue is lost to private insurers for unsupervised procedures performed by surgical trainees. Methods: We retrospectively evaluated a prospective database of procedures performed by residents and fellows from March 1998 through 2007. All procedures were entered by the trainees into a computerized electronic note system. Unsupervised procedures were not billed to insurance carriers. Results: During the study period, 14,497 minor procedures were performed without attending supervision, of which 13,343 had valid current procedural terminology codes. Total charges for these procedures would have been $10,096,931. For patients with private insurance companies (PICs), $6,876,000 could have been billed. Using our historic collection ratios, $2,269,083 in revenue was lost, or $232,726 annually. Conclusions: Trainees perform a significant number of unsupervised procedures on patients with private insurance without charge. This pro bono service represents a significant amount of lost income for teaching institutions. Private insurance companies benefit financially from Medicare billing regulations without contributing to education. Billing for these services might help offset the costs of graduate medical education.