Trump’s $100,000 H-1B Fee Threatens U.S. Doctor Shortage

(UNITED STATES) President Trump’s new executive order imposing a $100,000 H-1B fee on new petitions filed on or after September 21, 2025 has set off urgent warnings from hospitals and medical associations that the policy could deepen the U.S. 🇺🇸 doctor shortage, especially outside major cities. The White House says possible exemptions for physicians and residents are under review, but with the final rules not yet settled, hospitals say they must plan for sharp hiring cuts and delayed care in already stretched communities.

The order, now in effect, applies the one-time fee per new H-1B petition and does not touch current H-1B holders or individuals in J-1 training. Still, the change lands at a sensitive moment for the healthcare system. In 2025 alone, federal data show 5,640 H-1B approvals for healthcare roles, and more than 30% of U.S. medical residents are international medical graduates (IMGs). Hospital executives and recruiters warn the new cost could push them to freeze or cancel incoming offers for foreign-trained doctors, who often accept positions in rural and underserved areas that struggle to attract U.S.-trained physicians.

According to analysis by VisaVerge.com, hospitals are running budget models that factor in the fee plus legal and filing costs, and many say the economics break down for small facilities that rely on even a handful of IMG hires each cycle. Several large systems, including Mayo Clinic and Cleveland Clinic, have pressed for a broad carveout, arguing that a blanket H-1B fee for doctors undercuts patient care and increases wait times for specialty services that smaller communities cannot obtain elsewhere.

Policy Changes Overview

• Effective date: New H-1B petitions filed on or after September 21, 2025 are subject to the $100,000 fee.
• Scope: The fee applies to new applicants only. Current H-1B holders and J-1 visa holders are not affected.
• Exemptions: The administration has signaled that doctors and medical residents may qualify for exemptions if the Secretary of Homeland Security finds their employment to be in the national interest. It remains unclear whether this will be an industry-wide exemption or a case-by-case review.
• Legal landscape: Lawsuits argue the order conflicts with the Immigration and Nationality Act and functions as an unconstitutional tax. The Department of Homeland Security (DHS) is also reviewing broader H-1B process changes, including possible priority for higher-paid applicants.

The core dispute is about timing and certainty. Health systems are in the middle of fall recruitment, while DHS guidance on exemptions is still coming together. Hospitals facing tight margins, especially outside major metro areas, say they cannot commit to hiring international medical graduates without knowing if they’ll face a $100,000 line item for each new H-1B hire. Administrators also worry the fee could re-route foreign physicians away from the United States to other destinations that offer clearer, more affordable paths.

The order allows the Secretary of Homeland Security to set exemption criteria. If DHS chooses a broad healthcare carveout, hospitals say it could stabilize recruiting. If the department requires case-by-case filings, employers anticipate slower timelines, heavier paperwork, and uncertain outcomes that could push candidates to withdraw. Either way, the transition period matters: residency matches and physician onboarding run on fixed calendars, and delays of even a few weeks can leave clinics without coverage.

Impact on Healthcare Access and Employers

The United States faces a projected shortfall of 13,500 to 86,000 physicians by 2036, with the most serious gaps in rural communities. Hospital leaders say the H-1B fee threatens to choke off a pipeline that helps fill hard-to-staff specialties, including primary care, internal medicine, psychiatry, and some subspecialties.

A number of state hospital associations estimate the policy could raise staffing costs by 10–15% in the near term due to added legal steps, risk premiums, and travel changes when hiring must shift mid-cycle.

For smaller clinics and rural hospitals, the math is stark:

• Hiring one IMG physician can keep a service line open—weekend emergency coverage or maternity care, for example.
• Add a $100,000 hurdle per hire, and those facilities may drop plans to recruit abroad or cut hours to save cash.
• The result: longer drives for patients, fewer routine screenings, more late-stage diagnoses, and increased burnout and turnover among remaining staff.

Large academic centers are concerned for different reasons. They train future doctors and often rely on IMGs who hold or seek H-1B status during residency and fellowship. If the fee remains without a broad exemption, some programs expect to pivot toward J-1 sponsorship. That shift has trade-offs:

• The J-1 path often requires physicians to leave the country after training unless they obtain a waiver to stay and work in underserved areas.
• Fewer trainees remaining in the U.S. long term could widen the doctor shortage in coming years.

Practical changes already under discussion:

1. Some employers are weighing a switch from H-1B to J-1 sponsorship for trainees, accepting the risk that many will depart after residency if a waiver is not secured.
2. Recruiters are postponing offers to IMG candidates until DHS clarifies whether physicians and residents will be exempt.
3. Health systems are preparing to submit detailed exemption requests if DHS opts for a case-by-case model, which would add cost and time.

Filing Practicalities and Guidance

If you’re an employer assessing the new filing landscape, the basic H-1B steps still apply. Most H-1B petitions for doctors require:

• A certified Labor Condition Application (LCA) filed through the Department of Labor.
• An H-1B petition on Form I-129 submitted to U.S. Citizenship and Immigration Services (USCIS).

If DHS rolls out a physician exemption, expect added evidence needs—such as proof of service to an underserved area, lack of U.S. applicants, or urgent public health needs.

Useful links:
– USCIS H-1B information: USCIS H-1B Specialty Occupations
– H-1B petition form: USCIS Form I-129, Petition for a Nonimmigrant Worker
– Labor Condition Application: DOL Form ETA-9035/9035E

When recruitment stalls, appointment backlogs grow and specialty consults that took three weeks can stretch to three months. For chronic conditions like diabetes or heart disease, those delays have real health costs. Some emergency departments already run near capacity; if local clinics can’t hire, more patients end up in ERs for routine care, raising costs system-wide.

Arguments For and Against the Fee

Supporters of the policy argue:
– Higher fees can reduce abuse of the H-1B system.
– Fees could push employers to invest more in domestic training.

Health groups counter:
– Physician training pipelines take years to expand.
– Residency slots are capped by funding limits that require congressional action.
– Near-term impact falls heavily on communities that rely on international medical graduates now.

What Happens Next — Scenarios and Recommendations

Because the order is already active, the practical question is whether DHS will define a broad healthcare exemption quickly. Two main scenarios:

• Broad carveout for physicians and residents: Hospitals could resume recruiting with more certainty, though administrative slowdowns are expected as rules are implemented.
• Case-by-case exemption model: Employers would need to prepare robust filings showing “national interest” and direct service to underserved areas, adding time and expense.

Recommendations for stakeholders:

• Employers: Track DHS updates closely and prepare evidence files in case an exemption requires proof of local need—service area data, patient wait times, and prior recruitment efforts.
• Residency programs: If considering J-1 sponsorship as a stopgap, plan for the post-training reality, including how many graduates can secure waivers to stay practicing in the U.S.
• IMG candidates: Keep communication open with prospective employers about filing timelines, funding approvals, and contingency sponsorship paths.

Legal and Operational Implications

Legal challenges may proceed on a separate track. If courts issue injunctions, enforcement could be paused and hiring plans reshuffled. Until then, finance teams are running scenarios that assume either:

• Full fee exposure, or
• A narrow exemption with additional filing and legal costs.

For some employers, this translates to delaying expansion of services or reducing locum tenens coverage to save funds for potential H-1B fee payments.

Hospital leaders stress the impact is not limited to remote counties. Urban safety-net systems also depend on IMGs for shifts in emergency medicine, psychiatry, and primary care. Big-city hospitals might absorb costs for a time, while smaller facilities face immediate trade-offs—cut a service line, or pay the fee and delay facility upgrades or community outreach.

Advocacy groups are urging the administration to clarify the exemption path quickly. With the projected 13,500–86,000 physician shortfall by 2036, they argue that any barrier to recruiting qualified physicians risks worsening the national doctor shortage. A timely, clear exemption could reduce the shock to the system, while a drawn-out process could cause a year or more of missed hires as candidates choose other countries or return home.

The next few weeks will be decisive. DHS is reviewing exemption criteria and possible changes to weigh salary levels more heavily in selection and adjudication. Employers and international medical graduates are watching for concrete instructions—who qualifies, what proof is required, and how soon petitions can be filed without risking a six-figure fee. Until that guidance arrives, hospitals will keep running the numbers, and patients in thinly staffed regions will wait for answers—and for doctors.