A cost construction model to assess the cost of a family practice residency program.

BACKGROUND AND OBJECTIVES: This study uses a cost construction approach to evaluate the cost of training family practice residents in a university-based residency program. The approach calculates the cost of the educational program from a global institutional perspective, including all monetary and nonmonetary costs, independently of how they are financed. METHODS: Cost construction analysis is used to compute the instructional cost, which includes the cost of faculty and resident time directly related to teaching and the support of the teaching program. The value of the clinical care and supervision provided by the family practice residents is assessed as a replacement cost. Sensitivity analysis examines a range of assumptions concerning residents' productivity, replacement costs, and the cost allocation of activities that jointly produce clinical care and education. RESULTS: For a junior resident, the instructional cost is $94,835 per year, and the replacement cost is $65,052 per year. The value of the teaching and clinical services provided by senior residents, $124,247 per year, exceeds the cost of the resources used to educate them, $98,364 per year. CONCLUSIONS: The cost construction model can be used as a tool to allocate resources, negotiate for funding, and estimate variations in cost due to changes in curriculum and in the health care environment.