For once, we actually have a good question on here.
As AEH says - it's time and money. Screening applications, interviewing candidates, etc. costs everyone involved a lot of money. To reduce expenditure by (approximately) a third for each medical school reduce the number of applications by a third.
What's more, because the requirements of medical schools are so similar (but yet so different), someone who is rejected without interview (after is a different matter and not really relevant here) four times is quite unlikely to succeed given an extra two chances.
Does this apply for foundation medicine? I don't know. But, if you're eligible to apply to foundation medicine you should be ineligible to apply to medicine (so you can't do med, med, med, med, foundation, foundation).