The $100,000 H-1B Visa: Winners & Losers Edition

Last week, President Trump signed a proclamation requiring a $100,000 fee for all new H-1B visas. (For anyone unaware, the H-1B program allows American companies to employ skilled foreign workers when American workers with similar abilities can’t be found, and it’s the preferred visa pathway for many physicians who are not U.S. citizens but want to train and practice in the United States.)

This announcement generated a vigorous and often emotional response on social media. Unfortunately, much of what has come across my feed isn’t well grounded in fact or logic.

So who really wins – and who loses – when the H-1B gets a new six-figure price tag?

It’s time to break it down, Winners & Losers™️ style.

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WINNER: Current H-1B visa holders.

Following the announcement, many employers and visa holders were concerned that the $100,000 payment would be an annual fee, or would apply to workers who already had a valid H-1B. However, the White House has indicated that this will be a one-time fee that will only apply to new visa applicants.

It’s worth noting that visa policy can change with the stroke of a presidential pen, so none of this is necessarily settled. But for now, all the residents and fellows working on an H-1B can breathe easy.

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WINNER: The J-1 visa.

If you’re a U.S. citizen, you may not have given much thought to what, legally, you’d have to do to enter or work in the United States if you weren’t.

If so, the short answer is, you’d need a visa – a legal document granting permission to apply for entry and stay in the country for a specific purpose and time period.

According to the FSMB’s most recent Census of Licensed Physicians, there are 192,926 licensed physicians – approximately 17.8% of the entire workforce – who are non-citizen international medical graduates. While some of them have a green card (which allows them to live and work in the U.S. permanently), the others require a visa. For resident and fellow physicians, those visas are almost always of one of two kinds.

The first is the H-1B visa. As noted above, the H-1B program is intended to allow U.S. businesses to employ foreign nationals who have highly-specialized skills. Most of the news coverage of the proclamation has focused on impacts on the tech industry, which has become highly dependent on skilled foreign workers. But a doctor who graduates from medical school overseas also meets the educational and skills requirement for an H-1B.

However, the most common visa for residents and fellows is the J-1 visa. This visa program began in the Kennedy administration as a way to promote cultural exchange by allowing foreign nationals to obtain certain experiences or occupational training in the United States.

Because the J-1 was originally intended to spread U.S. cultural influence around the world, it requires that visa holders return to their home country for two years after their visa expires. Although both the J-1 and H-1B are non-immigrant visas, the H-1B has no home residency requirement – which makes it the preferred choice for international medical graduates (IMGs) whose long term goal is to stay in the U.S. long-term.

However, either the J-1 or H-1B is sufficient to justify legal presence and employability for residency training – so with a new $100,000 price tag for the H-1B, the J-1 will become the near-universal choice of residency and fellowship programs.

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LOSER: Moonlighting.

Beyond the home residence requirement, there are other differences between J-1 and H-1B visas – but most of them won’t impact residency training on a day-to-day basis.

But one that might is moonlighting.

As duty hour restrictions have tightened, many residency programs have added or increased internal moonlighting opportunities. These optional, paid shifts allow the program to provide 24/7 resident coverage – while allowing residents on electives to earn a little money.

However, the J-1 visa is a ‘cultural exchange’ rather than a ‘work’ visa – so a resident is strictly prohibited from earning money from anyone other than their sponsor or host organization. But the ECFMG – which sponsors J-1s for IMGs – only allows residents to be compensated for work that is an integral part of the training program. In contrast, residents on an H-1B can generally moonlight at the same institution.

With the shift from H-1B to J1, programs may have to fill some holes in their schedule – and residents may have to plug some holes in their wallets.

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LOSER: Special licensure pathways for IMGs.

Historically, becoming a licensed physician in the United States required completing residency training in the United States – even for doctors who completed medical school and residency training overseas.

But over the past several years, that’s started to change.

Beginning with Tennessee, and spreading to Virginia, Idaho, Wisconsin, Texas, and beyond, multiple state legislatures have passed laws that allow certain IMGs to obtain state licensure without completing U.S. residency training.

These programs anticipated enrolling IMGs who were either a) already legally allowed to work in the U.S., or b), would receive H-1B visas from the hospitals that employed them. (Although a J-1 is sufficient for a graduate medical education trainee, it does not cover an independent physician working for a hospital).

However, the imposition of this fee will dramatically shrink the pool of potential employers for IMGs that would have pursued these pathways – and may largely negate the intended impact of these state laws.

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LOSER: Rich IMGs.

One reader asked me if an IMG could just pay the $100,000 fee themselves.

If that sounds like a crazy question, it’s not.

Many doctors who want to train in the United States have completed medical school in countries where the cost of attendance is much lower than in the U.S. While the average U.S. MD graduates with a bit north of $200,000 in student loan debt, many IMGs graduate with none. And given that the average physician in the U.S. earns much more than their counterparts overseas, even an IMG who took out a $100,000 loan to pay the H-1B fee might expect a significant return on investment in the long term.

Moreover, some IMGs come from families who have financial resources – and are willing to use those financial resources to support their child’s dream of becoming a doctor in the U.S. (Long-term readers may recall the story of one couple who paid $400,000 to secure a residency position for their son… and when he was dismissed from the program, they sued the hospital for breach of contract – and won.)

However, under Department of Labor rules, the H-1B fee must be borne by the employer. Shifting that cost to the employee is illegal, because it undermines wage protections (e.g., employers could take the fees out an employee’s paycheck as a hidden pay cut). So even the richest H-1B aspirants are going to be out of luck here.

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LOSER: “Top Applicant” IMGs.

Given the home residence requirement and additional restrictions associated with the J-1, it’s understandable why the H-1B is the preferred visa for non-citizen IMGs. Still, the majority of visa-requiring residents train on a J-1, because they’re easier for the program.

While the ECFMG sponsors J-1s for any Match-eligible IMG who needs one, the H-1B has to be sponsored by an employer – and even now, there’s a fair bit of expense and red tape involved. Generally, hospitals hire an attorney and spend $5,000-$10,000 to obtain H-1Bs for residents.

Hospitals have been willing to take on these fees because offering an H-1B is a valuable recruiting tool. Only around 20-30% of internal medicine residency programs offer an H-1B – but those that do are often able to pry away their favorite applicants from programs that only offer a J-1.

But a $100,000 price tag is way too steep of a price for a residency program to pay even for their favorite applicants.

To convince a hospital administrator to sign off on such a significant expense, the program director would have to show a financial return on investment. Residents are money-makers for their employer – but ways that they generate money have nothing to do with whether the resident was the program director’s favorite or not. The federal subsidies that residents enable aren’t dependent on rank order list position, and the extra billing for hospitals and attending physicians doesn’t change much with a rockstar versus a replacement-level resident.

There could, in very rare and highly-circumstance specific instances, be situations in which a hospital might sponsor an H-1B for an IMG with exceptional clinical experience or research skills because they intend to retain them as faculty and have a realistic business plan for recovering their initial investment (with interest). But those situations will be few and far between, and almost all of the top IMG applicants will need to work through the J-1 system.

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PUSH: Residency programs.

According to some people online, residency programs will be devastated by the new visa fees. After all, 18% of program positions were filled last year by non-citizen IMGs.

If it makes you feel better, I don’t follow the logic, either.

While some residency programs may lose a relative advantage in recruiting due to an unwillingness to pay exorbitant H-1B fees, they’ll save money in the long run by shifting to J-1s. And while they may lose some of their favorite applicants to competitors, no categorical residency program should have trouble finding qualified applicants to fill their positions. Last year, over 14,000 non-citizen IMGs registered for the Match. Only 6,653 of them successfully matched to successful positions. Even if applicant numbers drop because of the inability to secure an H-1B*, we’d have a long way to go before programs would feel it.

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PUSH: U.S. medical graduates.

Supporters of this presidential proclamation claim it will help American workers who are currently being passed over for jobs by companies that hire non-citzens on H-1B visas.

Whether this is or is not occurring on any scale in the broader economy is something I will leave to others to debate. But within the residency selection system, this simply does not occur – and this proclamation will have no real impact on the match prospects for U.S. MD and DO graduates.

On a system level, U.S. medical graduates do not directly. compete with IMGs for residency positions. They target different specialties; even within the same specialty, they target different programs.

Consider, for instance, internal medicine. In 2025, 34% of categorial IM positions were filled by non-citizen IMGs and 36% were filled by U.S.

Given these data, you might think that if we randomly selected an internal medicine residency program, we might be likely to find one where around a third of residents were U.S. MDs and around a third were non-citizen IMGs. That’s what these averages might suggest, right?

Turns out, you’d be decidedly unlikely to find a program with residents in these proportions. You’d be far more likely to find one composed of 100% U.S. MDs or 100% IMGs.

From Tania Jenkins, *Doctors’ Orders: The Making of Status Hierarchies in an Elite Profession*. New York: Columbia University Press, 2020.

In reality, we have far more residency positions than U.S. medical graduates can fill. Last year, there were 1.97 PGY-1 positions offered in the Match for every graduating MD student. If you add in all graduating DO students, there are still 1.39 positions available for all U.S. MDs and DOs.

Does that mean that all MD and DO students match? Of course not. In a typical year, ~6-7% don’t. And while reasons are variable and often highly individual, they generally boil down to applying to a highly competitive specialty, trying to overcome academic deficiencies, or just plain bad luck. “I got passed over because every program wanted to hire visa-requiring IMGs on H-1Bs” is not a credible explanation for any U.S. medical graduate’s failure to match.

Although it can be uncomfortable to discuss frankly, in reality, IMGs function to fill residency positions that U.S. medical graduates do not want and that would not fill without IMG applicants. On a system level, IMGs compete with other IMGs – so whether an H-1B costs $100 or $100,000,000 really changes nothing for U.S. medical graduates.

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PUSH: U.S. citizen IMGs.

Not all IMGs require visas. Some international medical graduates are U.S. citizens who go to medical school overseas (most often in the Caribbean).

U.S. citizen IMGs face longer odds in residency selection. Last year, only 67% of them matched – which was higher than the 58% for non-citizen IMGs, but a long way from the ~93% enjoyed by U.S. MD and DO graduates.

Given this, it is much more reasonable to conclude that non-citizen IMGs do displace some U.S. citizen IMGs from residency training opportunities – which is why some see this presidential proclamation as a win for U.S. citizen IMGs.

But I don’t think it will change much.

Before we conclude that making an H-1B visa more expensive will change residency selection outcomes, we should first try to understand why some programs prefer non-citizen IMGs today – because then we can determine if that preference is likely to change in response to this policy.

Again, while discussing this frankly makes some uncomfortable, there are two common reasons why programs sometimes prefer non-citizen IMGs.

One is that they view non-citizen IMGs as being more qualified.

From a 10,000 foot view, this is objectively true. According to the NRMP’s Charting Outcomes data, the average non-citizen IMG who matches to a U.S. residency position scores a 245 on USMLE Step 2 CK.

That’s not quite as high as U.S. MD students (250), but is virtually identical to DOs (244). But even non-citizens who go unmatched score better on Step 2 CK than U.S. citizen IMGs who do (240 vs. 236). And U.S. citizen IMGs who don’t match score an average of 228 on Step 2 CK – which would place them at around the 8th percentile for U.S. MD test-takers.

But the second is that some programs find it easier to have non-citizen IMGs in their program.

On first pass, this may seem paradoxical. Managing visas generates lots of red tape, and doctors who have trained overseas often require more extensive onboarding to function efficiently in the U.S. health care system. But certain other problems may become easier for the program director to manage when a resident is on a visa.

When you’re on a J-1 or H-1B, your ability to stay in the country legally depends on your continued employment. Getting dismissed from a residency program is devastating for any resident, at least U.S. medical graduates and U.S. citizen IMGs don’t have to worry that it will trigger deportation. The visa is an anvil hanging over the head of non-citizen IMGs, and it gives the program incredible leverage over these residents. One program director told me that if he ever has to take a chance on a resident, he always wants a non-citizen IMG for this reason.

So will this presidential proclamation change anything for U.S. citizen IMGs? Phrased another way, does increasing the sticker price for an H-1B visa change the calculus that residency programs use now when evaluating U.S. citizen vs. non-U.S. citizen IMGs?

I don’t think so.

The programs that currently prefer non-citizen IMGs will continue to prefer non-citizen IMGs, even if the H-1B is more expensive – which is why this goes down as a PUSH for U.S. citizen IMGs.

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WINNER: The physician shortage.

Despite the fact that “the physician shortage” is a bedrock principle upon which much of health policy debate rests, regular readers know that I am very skeptical of the idea that we really have an absolute shortage of physicians.

I am not skeptical of the fact that many patients and communities struggle to access a physician when they want one and where they would prefer to be seen. We have access problems in the American health care system. But those problems are not going to be fixed by simply training more physicians.

From my standpoint, most of what we call “the physician shortage” is a distributional problem, and it’s driven by the incentives that doctors have to practice in certain ways, or in certain geographic areas, that are not necessarily the ways that might best serve society at large. And unless we change the incentives that lead doctors to make these decisions in the current system, we should expect that any new doctors we train will make the same decisions that current doctors do. They’ll stack up on each other in big cities and affluent suburbs; avoid seeing patients on public insurance; keep their schedules packed to the gills; and generate supply-induced-demand for their services. And patients who are underserved will remain underserved.

If we want doctors to make different decisions, they need different incentives. And unfortunately, this presidential proclamation will undo one of the most useful incentives we had to ensure that some of the most underserved patients had access to a physician.

Let me explain.

I mentioned before that J-1 visas have the two-year home residence requirement when the visa expires. But that requirement isn’t ironclad. It can, under certain circumstances, be waived.

One way to get a waiver is through the Conrad 30 program.

Named after former U.S. Senator Kent Conrad (D-ND), this program allows J-1 doctors who are willing to work for 3 years in federally-designated shortage areas to have the home residence requirement waived and receive an H-1B from their employer.

Over the past 30 years, the Conrad program has been an unusually successful federal program. It isn’t perfect – many physicians leave the shortage area as soon as their 3-year commitment is over, making for bit of a revolving-door – but it has maintained bipartisan political support even as American politics have grown more polarized, and it continues to deliver ~1000 physicians a year to areas that simply cannot consistently recruit U.S. MDs, DOs, or U.S. citizen IMGs.

But the employers who sponsor Conrad waivers are hardly rolling in the dough. Many are small community hospitals or rural health centers that are already struggling financially. (They’re also the most exposed organizations to other recent changes in health care, like the Medicaid cuts in the Big Beautiful Bill.) And now, on top of that, they’re facing a new $100,000 fee.

I think this is a bad move.

According to the U.S. Department of Labor, “the intent of the H-1B provisions is to help employers who cannot otherwise obtain needed… skills and abilities from the U.S. workforce by authorizing the temporary employment of qualified individuals who are not otherwise authorized to work in the United States.” Allowing hospitals to recruit foreign doctors into positions for which the market has convincingly demonstrated that U.S. doctors do not want and will not take seems well-aligned with both the intent of the program and the needs of society.

Certainly the Conrad program isn’t the only way that we could increase the supply of physicians to rural and underserved areas – and it may not be the best. It’s fair to consider other initiatives that could achieve the same ends – but until then, it’s important to recognize that the utility of the program hinges on affordable access to H-1B petitions.

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WINNER: Intellectual outsourcing.

These days, it seems like most people know whether a policy is good or bad, just by who proposed it. If they’re on your team, it must be a great idea. If they’re not, then it’s obviously not. You can intellectually backfill the reasons later – but you already know what your conclusion will be.

This is not the way to evaluate any policy. Deciding whether it’s good or bad – and how to make it better – requires carefully weighing the tradeoffs. It’s not something that should be intellectually outsourced to your party affiliation or political leader – but many of us seem not only willing, but eager, to do so.

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