Seems it comes down to: "budget-minded politicians in Congress"
According to 'studentdoctor.net' from 2017 - there is a cap because there are not enough residencies for graduating med students. The government is the primary payer for residencies: "It was because of the cost of GME funding that this program came under the fire of budget-minded politicians in Congress. This resulted in curbing of funding for residencies under the Balanced Budget Act (BBA) of both 1997 and 1999:" [1]
> The limitation in funding has essentially put a cap on the number of residencies that can take place in the United States – and since a doctor cannot go into practice without a residency, this is essentially a cap on the number of new, American-trained physicians who are allowed to practice in this country. The American Medical Association, in its AMA wire, blames this cap for the record number of students in 2015 who were not matched with a residency program at the end of their four years in medical school: of the 18,025 allopathic seniors and 3,000 osteopathic seniors who participated in the Main Residency Match, the two groups matched at rates of 93.9% and 79.3% respectively, leaving the highest percentage ever unmatched – and also unable to practice on their own.
> There are proponents for keeping the current cap in place, however. This is mostly among budget-minded members of Congress who are wanting to cut spending, but even the Obama administration proposed reducing Medicare expenditure on GME, even halving support for children’s hospitals, which have their own separate sources of funding. People on this side of this issue tend to decry the seriousness of the physician shortage, pointing out that the increase of physician’s assistants and advanced nurse practitioners has helped to mitigate this problem, even with the cap still in place.
The resource [1] is a bit dated. "Congress recently took steps to support several programs supporting GME funding by fixing technical issues that left some rural programs with an inadvertently low cap, expanding eligibility for rural training track funding, and adding 1000 new Medicare-funded positions for the first time since 1997. " [2]
According to 'studentdoctor.net' from 2017 - there is a cap because there are not enough residencies for graduating med students. The government is the primary payer for residencies: "It was because of the cost of GME funding that this program came under the fire of budget-minded politicians in Congress. This resulted in curbing of funding for residencies under the Balanced Budget Act (BBA) of both 1997 and 1999:" [1]
> The limitation in funding has essentially put a cap on the number of residencies that can take place in the United States – and since a doctor cannot go into practice without a residency, this is essentially a cap on the number of new, American-trained physicians who are allowed to practice in this country. The American Medical Association, in its AMA wire, blames this cap for the record number of students in 2015 who were not matched with a residency program at the end of their four years in medical school: of the 18,025 allopathic seniors and 3,000 osteopathic seniors who participated in the Main Residency Match, the two groups matched at rates of 93.9% and 79.3% respectively, leaving the highest percentage ever unmatched – and also unable to practice on their own.
> There are proponents for keeping the current cap in place, however. This is mostly among budget-minded members of Congress who are wanting to cut spending, but even the Obama administration proposed reducing Medicare expenditure on GME, even halving support for children’s hospitals, which have their own separate sources of funding. People on this side of this issue tend to decry the seriousness of the physician shortage, pointing out that the increase of physician’s assistants and advanced nurse practitioners has helped to mitigate this problem, even with the cap still in place.
The resource [1] is a bit dated. "Congress recently took steps to support several programs supporting GME funding by fixing technical issues that left some rural programs with an inadvertently low cap, expanding eligibility for rural training track funding, and adding 1000 new Medicare-funded positions for the first time since 1997. " [2]
[1] https://www.studentdoctor.net/2017/01/24/medical-students-kn...
[2] https://www.ncbi.nlm.nih.gov/pmc/articles/PMC8370355/