https://www.washingtonian.com/2020/04/13/were-short-on-healt...
I wasn't under the impression that medical residents were solely a drain on hospital resources—my sense was they did a lot of the smaller tasks to free up licensed physicians to do more. At some point, if there aren't enough CMS-funded residencies and there aren't enough licensed doctors, wouldn't hospitals just start hiring more residents?
The article you linked to has a heading that touches on this ("how did we end up with Medicare basically determining the number of new doctors per year?"), but doesn't actually answer the question it poses. It explains why the government started funding residencies, but not why the industry is now completely dependent on that funding.
I think rather it is a collective action problem.
Hospitals don’t want to invest 150k per resident to have that person leave the day they are done. It is common for doctors to do residency where they can and then move.
A better option would be for the fed to cut residency funding entirely and have hospitals pool resources themselves.