Antitrust laws deem horizontal agreements that eliminate competitive bidding within a market to be illegal. However, since 2004, medical residency programs, including medical schools and teaching hospitals participating in the National Resident Matching Program (commonly referred to as “the Match”), have been exempt from this prohibition. Now, the House Committee of the Judiciary’s Subcommittee on the Administrative State, Regulatory Reform, and Antitrust is evaluating the efficacy of this exemption and considering potential reforms to the medical residency labor market.
The Match, which has been in place since the 1950s, is a closed employee hiring process operated by the Accreditation Council for Graduate Medical Education (ACGME). Medical students in their final year of school confidentially rank their preferred residency programs, while residency programs confidentially rank their preferred residency candidates. An algorithm then matches students to residency programs based on these rankings. Each year, on the third Friday of March, medical students learn whether and where they matched. In 2024, the ACGME placed 41,503 first-year residents in residency programs through the Match.
The Match was designed to address disorder in the medical residency hiring process. Before its establishment, to stay competitive and hire the best medical students, residency programs often made early residency hiring decisions—sometimes hiring students only halfway through medical school—and required students to make rapid employment decisions within 12 hours of receiving an offer. This created significant pressure for students to accept the first offer that they received or hold out for a better offer that may never come. Meanwhile, residency programs were forced to gamble on young medical students who showed hints of promise with a thin medical school track record. Tired of wagering their futures, medical students and residency programs advocated for a centralized, orderly process to match students to residency programs.
In 2002, nearly 50 years after the creation of the Match, three medical students sued medical schools and teaching hospitals, alleging that their participation in the Match had artificially stabilized medical residency wages below competitive levels and eliminated recruitment and employment competition. In 2004, Congress passed a statutory antitrust exemption for those who “sponsor, conduct, or participate in a graduate medical education residency matching program” thus negating claims of the medical students, and in so doing, immunizing agreements between residency programs to eliminate bidding within the residency employment market.
Last week, the House Antitrust Subcommittee requested documents and information from ten medical schools and associations, including the ACGME, to assess its “concern[] that this exemption may reduce competition, harming residency applicants and patients.” In letters signed by Representative Scott Fitzgerald, the Subcommittee contended that the exemption had “distorted the American medical residency market, undermining free-market principles to the detriment of the nation’s doctors and the patients who rely on them.”
The Subcommittee specifically took issue with two aspects of the Match. First, it argued that the binding nature of the Match prevents applicants from negotiating employment terms, such as compensation and benefits. Participating applicants and residency programs agree to be legally bound to the outcome of the Match, even if both parties wish to reject their match. Second, the Subcommittee claimed that the medical organizations governing the ACGME facilitate the sharing of employment information, including salary data. The Subcommittee concluded that such actions—“preventing free-market employment negotiations and coordinating the sharing of wage information”—suppress resident salaries and restrict their freedom to contract and work.
Moreover, the Subcommittee contended that the Match creates a “bottleneck” in the physician workforce. Each year, thousands of medical students fail to secure a residency placement and because participation in an accredited residency is required to become a licensed physician and the ACGME is the only medical residency accreditor, these thousands of students are effectively excluded from the physician workforce. Consequently, the Match contributes to the current national physician shortage.
Repealing the statutory antitrust exemption for medical residency matching programming would undoubtedly disrupt the residency employment market, which has long relied on the Match as the primary method to place medical residents. As the Subcommittee continues its investigation, the outcome may reshape the future of how we train and employ the nation’s physicians. If you or your clients have any questions concerning these issues, please reach out to James Kovacs and Ellison Snider.
