Medical Education Trust Fund Act of 1997

Medical Education Trust Fund Act of 1997 - Amends the Social Security Act (SSA) to add a new title XXI (Medical Education Trust Fund) establishing in the Treasury the Medical Education Trust Fund, consisting of various specified accounts. Requires the Secretary of Health and Human Services to make annual payments from the Fund to eligible medical schools and teaching hospitals applying for assistance to: (1) maintain and develop quality educational programs in an increasingly competitive health care system; and (2) meet the indirect and direct costs of graduate medical education. Outlines requirements for Fund investments and determination of payments.

Amends SSA titles XVIII (Medicare) and XIX (Medicaid) to provide for annual transfers to the Fund. Makes specified appropriations to the Fund.

Amends the Internal Revenue Code to impose a tax equal to 1.5 percent of premiums received under accident or health insurance policies (including applicable self-insured plans), and equal to 1.5 percent of the amount received for certain health-related administrative services, payable by the policy issuer and the service provider, respectively. Makes specified appropriations and transfers of such amounts collected to the Fund for allocation among the various specified accounts.

Establishes the Medical Education Advisory Commission to study and report on Fund operations and other specified matters, including recommendations for demonstration projects. Authorizes appropriations.

Directs the Secretary to prescribe guidelines for the establishment and operation of such demonstration projects.