In 2026, 10 new medical schools have been announced, and several more have opened. Yet, they may not alleviate physician shortages.
Four notes on the current state of the physician shortage
1. Across 35 specialties, there is a projected shortage of 141,160 full-time equivalent physicians and a projected shortage of 70,610 primary care providers by 2038. Only five specialties are expected to see a surplus of workers: Critical care and pulmonology, endocrinology, emergency medicine, neonatology and neurology.
2. Physician specialties are seeing a growth rate of 3% to 6%. Dermatologists and psychiatrists lead in specialty growth at 6%; they are two of seven specialties that saw pay decreases in 2026. Overall, physician pay rose 3% in 2025.
3. On a specialty level, some of the highest-paid specialties are also among the most acutely short-staffed. Vascular surgery is projected to face the greatest shortage of any specialty by 2038, with supply meeting only 66% of projected demand. Ophthalmology follows at 72% adequacy, thoracic surgery at 73% and plastic surgery at 74%. All four rank among the higher-paying specialties.
4. Currently employed physicians who are considering leaving clinical practice dropped to 33% in 2026 compared to 39% in 2025 and 50% in 2024.
The prime driver of physician shortages
The driver behind the physician shortage isn’t medical school slots, but residency programs.
National healthcare organizations have cited the cap on GME funding as a contributor to the physician shortage. Despite growing enrollment in medical schools, thousands of eligible applicants do not match into a residency program. Since Medicare will only fund up to the cap, hospitals must cover the cost of training any additional residents.
To control federal spending on Graduate Medical Education, a 1997 law established caps on the number of Medicare-supported positions based on the number of residents training at teaching hospitals in 1996. In 2021, Congress authorized funding for 1,000 new Medicare-supported residency slots over five years — the first such expansion since 1996. An additional 200 slots were included in a 2023 law. On Dec. 18, CMS awarded 400 new Medicare-funded residency positions to more than 130 teaching hospitals nationwide as part of a broader push to expand physician training capacity, particularly in rural communities and other high-need areas.
In June 2025, a new federal bill — the Resident Physician Shortage Reduction Act of 2025 — was introduced. If passed into law, CMS would incrementally increase the applicable resident limit by 14,000 for eligible hospitals between 2026 and 2032. It came shortly after another federal bill aimed at adding 5,000 new residency slots nationwide. To date, neither bill has passed.
Some systems like Clearwater, Fla.-based BayCare, and Phoenix-based Banner Health and Tucson-based University of Arizona Health Sciences added residency slots using their own finances.
This year, Match Day 2026 recorded a 93.5% match rate for all positions and a 93.3% rate for PGY-1 positions, which are both 0.8% lower than 2025 match rates. Overall, 53,373 applicants registered, and 41,482 of 44,344 total residency positions were filled, according to the National Resident Matching Program.
Issues that remain
Despite systems’ growing efforts to expand medical education and residencies, a few issues remain.
1. Although residency slots are growing, it remains unclear if they will keep up with the number of medical students who graduate. According to National Resident Matching Program numbers, 22.3% of residents did not match in 2026, yet 6.5% of slots were not filled.
2. It is also not clear if unmatched students will continue to work in medicine or move to other fields.
3. Many of the medical schools that are opening are associated with a health system, creating a direct pipeline for those systems. Although this is a promising strategy for individual systems, it’s unclear if this will reduce shortages nationally, especially in underserved areas.
4. There is also no data to show how residency slots will be distributed by specialty, meaning some specialties may continue to see shortages even if caps are increased.
