The Supreme Court's recent ruling that medical residents are employees -- not students -- raises questions beyond whether they should be paying into Social Security and Medicare.
The ruling this month in the case involving the Mayo Clinic and University of Minnesota officially only applies to payroll taxes. But residents and labor groups across the country are asking whether it could lead to changes to things like who regulates working hours, or who is eligible for student perks like discounted bus passes.
Mayo and the University of Minnesota had fought an IRS rule making residents employees, requiring the hospitals to withhold payroll taxes.
The university and Mayo have been collecting the payroll taxes since 2005. Had they prevailed at the Supreme Court, the IRS would have had to refund those payments, about $24 million in the University of Minnesota's case. As it stands, the university and Mayo will continue obeying the IRS rule, which means no changes to residents' paychecks.
National organizations representing medical residents applauded the ruling, saying it confirmed their eligibility for certain federal labor protections like disability pay and survivor benefits. And some leaders said the acknowledgment that residents are employees could also help in their fight for safe working conditions, including limits on working hours.
Medical school graduates are required to complete at least three years of residency at a hospital or clinic before they can become licensed physicians. Doctors at the facilities supervise the residents, who receive training and attend to patients. Some programs also have an academic component, such as a research project.
"It's really important that residents are recognized as employees so that federal agencies like [the Occupational Safety and Health Administration] are able to take action to help restrict the excessive demands that are placed on interns and residents that ultimately compromise the quality of care that they're able to provide," said Elizabeth Wiley, secretary and co-legislative director of the American Medical Student Association.
But those completing their residencies through universities, including the University of Minnesota, fear the ruling could mean the end of the dual identity they've enjoyed in recent years -- they've had a chance to qualify for federal benefits while also taking advantage of their student status.
BEST OF BOTH WORLDS
Tom Leventhal, a University of Minnesota chief resident, said his student status has allowed him to vote and file income taxes in Wisconsin, where his parents live. He's also stayed on his parents' car insurance, which helps save money.
Leventhal, who has racked up about $200,000 in medical school loan debt, also saves money by taking advantage of numerous student discounts, including his student bus pass that's a third of the price faculty and staff pay.
Leventhal is happy to pay FICA taxes, which fund Social Security and Medicare, but he wonders if that could lead to more.
"Now it's just FICA taxes, but where does this whole delineation between student and employee go from here? That's what's concerning," he said.
Balaji Krishnan, a 2nd year University of Minnesota resident, said perks like the student bus pass, access to the university rec centers and discounts on sports and concert tickets was a selling point when he was looking at residency programs.
"It's one thing that has always made the U of M stand out from a recruiting standpoint," Krishnan said. "We have both the privileges that staff get and what students get."
U of M residents haven't been dropped from special student programs so far, and university officials said it would be up to the individual university departments that offer the discounts to decide who's eligible.
Many universities with medical residency programs, including the University of Iowa and University of Wisconsin, give residents only the perks offered to faculty and staff.
EMPLOYEE STATUS -- A BETTER POSITION IN LABOR NEGOTIATIONS?
Money isn't the only factor driving the debate over whether medical residents should be considered students or employees. Working conditions -- and patient care -- have also been part of the discussion.
Most residents work well over 40 hours a week, and some have been fighting for limits, arguing that sleep deprivation can add safety risks for residents and bring down the quality of patient care.
First-year residents, called interns, work up to 16-hour shifts. More experienced residents can be forced to work a 24-hour shift. During one week, a resident can work up to 80 hours.
Leaders with the American Medical Student Association want to expand 16-hour shift limits to all years of residency, and they said the Supreme Court decision could help that effort.
"Even though the Supreme Court's ruling doesn't go beyond the FICA taxes, just having it in the statements that residents are classified as employees or workers instead of students would give us some kind of leverage," said Divya Sood, president of the association's chapter at the University of Minnesota.
Public Citizen, a national citizen advocacy group, said the court decision bolsters the argument that residents should have other basic worker protections, including "a good night's sleep." The group is part of a coalition that last year asked the Occupational Safety and Health Administration to require 16-hour shift limits for all residents. The matter currently rests with the Accreditation Council for Graduate Medical Education.
But because the Supreme Court decision didn't set precedent for future cases, advocates for work hour limits will have to continue building a legal case for the change. And many hospitals and even some residents will fight further limits.
"A lot of our residents really want to stay with their patients instead of having to hand them off at the end of the shift," said Mary Koppel, assistant vice president for public affairs at the University of Minnesota's Academic Health Center.
Leventhal, the U of M chief resident, said he thinks working long hours is a necessary part of training, allowing residents to be exposed to many situations. The long hours also make him feel more like a student than an employee, he said.
"When I think of employee, I think of more of a full-time, 9-5, Monday through Friday type job," he said. "With residency training, it's always learning. Every patient is different."
Your support matters.
You make MPR News possible. Individual donations are behind the clarity in coverage from our reporters across the state, stories that connect us, and conversations that provide perspectives. Help ensure MPR remains a resource that brings Minnesotans together.