On November 9, 2026, the Centers for Medicare & Medicaid Services (CMS) posted the results of Round 5 of the Section 126 awards on its Direct Graduate Medical Education page. This is the last round of the 1,000 Medicare-funded residency slots created by Section 126 of the Consolidated Appropriations Act, 2021. According to the Association of American Medical Colleges (AAMC) and AHA News, this final round sends 200 positions to 99 teaching hospitals.
What changed
Medicare pays teaching hospitals for a capped number of full-time equivalent (FTE) residents. The AAMC notes that this cap dates back to the Balanced Budget Act of 1997. Section 126 added 1,000 new FTE cap slots, phased in at no more than 200 per year beginning in fiscal year 2023. With Round 5 posted, all five rounds are now out.
- Size of this round: 200 FTE slots for 99 hospitals in 31 states, according to the AAMC.
- Specialty mix: the AAMC reports that CMS estimates about 42% of the new positions will go to primary care and psychiatry programs. This is an estimate, not a final count by specialty.
- Start date: the CMS Section 126 FAQ says slots awarded in this round take effect July 1, 2027.
- Permanent funding: CMS states that all cap slots awarded through Section 126 are permanent.
- Limits: no single hospital can receive more than 25 Section 126 slots in total.
To qualify, a hospital had to fit at least one of four groups: rural (or treated as rural), already training more residents than its Medicare cap, located in a state with a new medical school or branch campus, or serving a geographic Health Professional Shortage Area (HPSA). CMS ranked applications by HPSA score, so hospitals serving areas with the greatest shortages were funded first. CMS also says the law's requirement that each of the four groups receive at least 10% of the slots has now been met.
Section 126 is separate from Section 4122 of the Consolidated Appropriations Act, 2023, which added another 200 slots beginning in fiscal year 2026, at least half of them for psychiatry. CMS posted those results on December 18, 2025.
Why it matters for students and residents
Every residency position needs funding, and Medicare is a major source of GME support. Permanent new slots at hospitals in rural and shortage areas can, over time, mean more training positions in places that have struggled to grow programs. For international medical graduates and U.S. students applying broadly, these are often the community and rural programs already on their lists.
Two points keep expectations realistic. First, 200 slots is small next to a Main Residency Match that offers tens of thousands of positions each year. Second, a cap slot is funding, not automatically a new seat. One of the four eligible groups is hospitals already training residents above their cap, so some awards may pay for residents a hospital already trains rather than add new positions. Programs that do want to grow usually also need accreditor approval for a larger resident complement before they can add seats.
The AAMC projects a shortfall of up to 86,000 physicians by 2036. Its president and CEO, David J. Skorton, MD, said "our country remains in desperate need of additional, permanent residency positions." The AAMC is urging Congress to pass the Resident Physician Shortage Reduction Act of 2025 (H.R. 4731 / S. 2439).
What to do now
- Applicants in the 2027 Match: the July 1, 2027 effective date lines up with the start of the next residency year, but do not assume a program has more positions. Check each program's website and its listing in the NRMP system for its current number of positions. Our residency process guide walks through building a balanced list.
- Students planning ahead: awards were ranked by HPSA score, so programs in rural and shortage areas are worth a closer look. CMS estimates about 42% of these positions will go to primary care and psychiatry.
- Residents: if your hospital received slots, ask your program leadership how they plan to use them. New funding can affect program size over the next few years.
- GME leaders: CMS posted the full award list as a ZIP file on its DGME page. Confirm your hospital's award and plan with your finance and cost report teams before July 1, 2027. MedRise supports hospitals and GME offices with recruitment and IMG onboarding.
What we don't know yet
CMS has not published a specialty-by-specialty count in the sources we reviewed, so the 42% figure for primary care and psychiatry is an estimate. It is also not yet clear how many of the 200 slots will create new training positions versus fund residents already in place, or whether lawmakers will create more slots now that Section 126 is fully distributed.
Want help planning your next application cycle? See our support for medical students and residents.
Sources: CMS, Direct Graduate Medical Education (DGME), Section 126 and Section 4122 (Round 5 posted Nov. 9, 2026); CMS, Frequently Asked Questions: Section 126; AAMC, CMS Announces Distribution of Last Medicare-Supported GME Residency Positions (Nov. 10, 2026); AHA News, CMS allocates 200 Medicare-funded residency slots to 99 teaching hospitals (Nov. 10, 2026); AAMC, Applications Open for Final Round of Section 126 Residency Distributions (Jan. 9, 2026).
MedRise Medical News summarizes public announcements and research for education only. It is not medical, legal or immigration advice.
