A Dr friend of mine mentioned that he tried to apply as an AME with the
local FSDO and was told "we already have enough AME's go away".

Same thing recently happened here, AFTER we lost two local AME's to
retirement. It made us question whether or not the retiring AME's notified
the FSDO that they were no longer active. Does anybody in the group know
how the FSDO or FAA keeps track of active/non-active AME's?

Jim