I think it is primarily a matter of insurance expectations and regulation of residents. It dictates what services they can bill for and the amount of redundant oversight required.

It is a self imposed problem.

The problem is largely imposed by Congress in terms of strict rules about what hospitals are allowed to bill Medicare for. This is not something that teaching hospitals have imposed on themselves.

correct, I didn't mean to imply it was by the hospitals, although the teaching hospitals may still benefit from the current arrangement.