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In the United States, the medical education community has begun a shift from the Flexnerian time-based model to a competency-based medical education model. The graduate medical education (GME) community is substantially farther along in this transition than is the undergraduate medical education (UME) community.GME has largely adopted the use of competencies and their attendant milestones and increasingly is employing the framework of entrustable professional activities (EPAs) to assess trainee competence. The UME community faces several challenges to successfully navigating a similar transition. First is the reliance on norm-based reference standards in the UME–GME transition, comparing students’ performance versus their peers’ with grades, United States Medical Licensing Examination Step 1 and Step 2 score interpretation, and the structured Medical School Performance Evaluation, or dean’s letter. Second is the reliance on proxy assessments rather than direct observation of learners. Third is the emphasis on summative rather than formative assessments.Educators have overcome a major barrier to change by establishing UME outcomes assessment criteria with the advent and general acceptance of the physician competency reference set and the Core EPAs for Entering Residency in UME. Now is the time for the hard work of developing assessments steeped in direct observation that can be accepted by learners and faculty across the educational continuum and can be shown to predict clinical performance in a much more meaningful way than the current measures of grades and examinations. The acceptance of such assessments will facilitate the UME transition toward competency-based medical education.