WILMINGTON, DEL. -- The Resident Match is fundamentally anticompetitive and represents an effort to depress the wages and opportunities of medical residents, according to a lawsuit filed by former and current residents.

As the suit drags on in court, some of the hospitals involved are

"The residency market is problematic," compared with other business markets, Kristin Madison, Ph.D., said at the annual meeting of the American Society of Law, Medicine, and Ethics. Unlike other markets, "[the hospitals] know where residents come from; they know what pool of candidates they will be choosing from. They also have only a fixed number of slots."

On May 7, former residents Dr. Paul Jung and Dr. Luis Llerena, along with current resident Dr. Denise Greene, sued the Association of American Medical Colleges, the National Resident Matching Program, the American Medical Association, several other physician and hospital organizations, and 28 hospitals.

The suit alleges that, by using the Match Day computer program to place residents into residency slots, the defendants have "illegally contracted, combined, and conspired among themselves to displace competition in the recruitment, hiring, employment, and compensation of resident physicians, and to impose a scheme of restraints which have the purpose and effect of fixing, artificially depressing, standardizing, and stabilizing resident physician compensation and other terms of employment

The suit seeks unspecified monetary damages as well as a halt to the National Resident Matching Program.

There are several reasons that the Match could be viewed as anticompetitive, said Dr. Madison, assistant professor of law at the University of Pennsylvania, Philadelphia.

The variation in stipends for residents is quite small. A 2002 survey of 270 teaching hospitals by the Association of American Medical Colleges showed that, for first-year residents, stipends ranged from $36,782 for residents in the 25th percentile, to $39,888 for residents in the 75th percentile--not a big difference. "What causes these kinds of salary distributions? One possibility is the Match," she said.

With the Match, residents can't use one offer to leverage another, and they can't wait until they have an offer and then negotiate better compensation or better working conditions. "Hospitals have a 'take-it-or-leave-it' bargaining power," she noted.

The Match also requires all residents to adhere to its results. That restricts residents' ability to make commitments early on, before the Match takes place, something that some risk-adverse residents may want to do."

Maybe they want more lead time or they want to move their family early," she said. Because of the Match, they can't.

In addition, even if residents like the first program they see, they are required by the Match to go out and visit other programs, leading to higher travel costs.

On the other hand, there are several procompetitive components to the Match Day system, she said. "The Match process still allows students and programs to compete for higher rankings, and participants can discuss terms, including stipends."

Another procompetitive argument is that holding the Match on just one day results in a higher-quality program overall. But even if the current Match Day program disappeared, residents still would not witness a truly competitive market at work, she added.

"Some programs are vastly oversubscribed and others are vastly undersubscribed." And the more popular programs aren't going to see slots added because the Accreditation Council for Graduate Medical Education (ACGME) has a limit on the number of slots that residency programs may offer.

One reason for such a limit might be quality related: For example, someone running a surgery residency would want to limit the number of residents so he can make sure that each resident is getting experience with a certain minimal number of surgical procedures.

But it's also possible to view this as an anticompetitive restraint, Dr. Madison said. The ACGME committees that make these decisions "consist of physicians in the profession, and they may be trying to increase their own income by limiting entry."