Aren't they doing actual useful work same as regular doctors? (albiet with a higher error rate)
So they could be funded through via charging for services rendered.
Of course their effective pay may be close to zero, after malpractice insurance, but it will still attract some number of med school grads who can't get in otherwise.
Residency slots don't mandate public funding. The majority of funding comes through the Medicare program but private foundations also contribute some. Private payers (insurance companies) also indirectly subsidize residency slots by paying teaching hospitals higher rates.
Some services performed by residents are billable, especially the more experienced ones. But the programs as a whole run at a loss after accounting for overhead so hospitals won't add more slots without a matching funding source.
What "luxury" hospitals? I've never seen the word "luxury" used to describe the teaching hospitals which train most residents. Most of them have high proportions of Medicare/Medicaid patients where rates are set by the government and hospitals have zero ability to charge more. I don't think you understand the reality of healthcare economics; this isn't a free market where sellers can change prices and supply to meet customer demand.
Colloquially, from the folks I've spoken to, luxury refer to those hospitals that offer high-end rooms, fancy furniture, concierge service, and so on, for a higher fee. I.e. Places where the differences are immediately obvious to the layman
If it's indeed the case that most hospitals can't cover their overhead then by default it must be limited to the high end, if it ever does happen.
Aren't they doing actual useful work same as regular doctors? (albiet with a higher error rate)
So they could be funded through via charging for services rendered.
Of course their effective pay may be close to zero, after malpractice insurance, but it will still attract some number of med school grads who can't get in otherwise.