Med Students Seek Cure for Debt
After four arduous years at the USC School of Medicine, Renee Sabshin is within months of becoming a doctor.
But with $180,000 in school loans, the soon-to-be psychiatrist fears for her financial future. For at least the next four years, the 31-year-old will earn between $30,000 and $40,000 a year as a resident. That’s hardly enough to pare down her debt or to allow her to move from her $650-a-month studio apartment to a larger space.
“I’ll be a doctor, and all I want is a bedroom,” she said. “It’s scary, because there’s absolutely no way someone can make a $2,000 monthly loan payment on $30,000 a year. I have moments where I feel like I’m in deep water.”
Completing medical school used to be a ticket to financial prosperity. But among today’s doctors-in-training, the profession’s outlook appears far less lucrative or prestigious. Managed care has forced physicians to accept lower fees for their services, reducing their income and autonomy. And with tuition hikes each year, medical school debt has soared to unwieldy heights.
The average annual tuition at a public U.S. medical school is now $10,324 for a state resident, compared with about $28,000 at a private school, according to the Assn. of American Medical Colleges. Meanwhile, the median debt of graduates has soared to $80,000, although the figure is higher at private schools such as USC, where students graduate, on average, $120,000 in debt.
This may not be sitting well with the nation’s college students. Between 1998 and 1999, medical school applications dropped 6%, from 41,004 to 38,534, continuing a downward trend since the all-time high of nearly 47,000 in 1996, according to recent AAMC figures.
The number of minority applicants, including blacks, Native Americans and Mexican Americans, dropped even more significantly. It declined 7% from 1998, from 4,486 to 4,176.
“This is a huge step backward,” said Jordan J. Cohen, AAMC president. “The medical work force in the future may not be optimally prepared to deal with our very diverse society. And we know that members of minority groups tend to choose to serve underserved communities when they graduate, so that is a significant concern.”
Cohen also worries that rising indebtedness will steer lower-income and middle-class students to other careers. “We certainly don’t want this to become a rich person’s profession,” he said.
Officials attribute the overall decline of applicants in part to the strong economy and the fact that students with science or technical expertise are flush with job opportunities in the high-tech industry.
“There’s incredible excitement with the instant riches of the computer world,” said Clive Taylor, the USC School of Medicine’s associate dean of academic affairs. “Students may be thinking, ‘Should I go to medical school, which costs $40,000 a year, or make $40,000 a year at a high-tech job?’
“Plus, there’s been a perception over the past five or six years that medicine is a tough career. Practice groups are going bankrupt, and physicians are being asked to be more accountable for their actions, both fiscally and in terms of patient care.”
According to the latest available figures from the American Medical Assn., physicians’ median net pretax annual income dropped slightly between 1996 and 1997, from $166,000 to $164,000.
“Doctors are under siege,” said William Plested, a private cardiovascular surgeon and UCLA professor who is an AMA board member. “Doctors have to fight with HMOs and make sure to fill out 60 different forms. I still love taking care of patients, but it’s become a bureaucratic hassle.”
Becoming a doctor is also an arduous pursuit, requiring four years of undergraduate study, four years of medical school and an additional three to 10 years of residency training. Because of such lengthy training as well as the financial costs, medicine is not for those who want to get rich quick, USC’s Taylor said.
“I think we’re seeing more students who are entering it because it’s what they really want to do, not just for the dollar,” he said.
Overall, Sabshin doesn’t regret becoming a doctor, but she worries that she’ll be well into her 40s before she’s debt-free. She can defer paying her loans until after her residency, but interest will accrue.
“We’re all really concerned about it, especially the older students,” she said. “A lot of people are starting to get married or thinking of children, and we feel like we have a huge burden. And it’s hard because we all have friends who are MBAs or lawyers, who are making lots of money.”
Jess Thompson, a student member of USC’s medical school finance committee, said money seems to be on every student’s mind. To pay for his education, the 27-year-old borrowed $168,000, which he said is more than his parents’ mortgage.
“This is definitely going to limit what specialties in medicine we go into,” said Thompson, a third-year student who has wanted to be a surgeon since the fifth grade. “People won’t be able to practice rural family medicine or choose other low-paying specialties because they’ll have too much debt.
“I think a lot of people are getting turned off by medicine because doctors are losing their salaries and autonomy,” Thompson said. “I still think it’s a great career, but something has to be done if medical schools still want to attract the best students.”
To be sure, the quality of medical students is far from slipping. The number of applicants still exceeds the number of slots by nearly 2.4 to 1, which means well more than half of those who apply are turned away.
“It’s still a very talented, academically superior pool,” the AAMC’s Cohen said.
Said Gerald Levey, dean and provost at UCLA School of Medicine: “I still think medicine is viewed as a very attractive career by students. They see it as a career where they can obtain a great deal of satisfaction helping others. Quite frankly, we have so many people who want to come here that we don’t worry about whether we have 300 less applicants or 300 more.”
Some also believe a declining interest in medicine is not entirely negative because there are too many doctors being produced for the nation’s needs. In 1995, the AMA said there was a surplus of physicians and recommended that medical schools cut enrollment. But the number of entering medical students actually has risen since then.
Still, Plested believes such issues should not deter the medical community from addressing the troubles surfacing at medical schools.
“Kids come out loaded with obscene amounts of debt, and they can’t go out and open a practice or serve an underserved area,” he said. “They’re bright-eyed and in it for the right reasons, but this can’t go on. It’s time for physicians to do something about it.”
To avoid racking up six-figure debt, Sameer Bakhda, a fourth-year medical student at USC, agreed to serve three years in the Navy after he completes his residency. As part of the deal, the Navy is paying his tuition and books and giving him $900 a month for living expenses.
“I’d rather spend three years in the Navy than spend the next 20 years owing money to a bank,” said Bakhda, 24, who hopes to go into emergency medicine.
Bakhda said he is also concerned about managed-care cuts, but he says that younger doctors come into the profession understanding the situation.
“Medicine isn’t the way it used to be, when you go in and make $350,000 a year with your fat-cat friends giving you referrals,” he said. “If you want to be rich, you should come up with your own ‘dot-com’ company. For medicine, you have to be committed and work really hard. It’s not an easy road, but it’s worth it.”
Cohen said his group is trying to lobby for expanded loan-forgiveness programs, whereby students who work in underserved areas are relieved of their school debt.
“Right now, the program is not as large as it could be or should be, and the need is great,” he said.
Meanwhile, USC is trying to curb its tuition hikes, although tuition last year still increased by 4%. Taylor said it’s difficult for private schools, because they depend on tuition to pay their faculty.
Both USC and UCLA also are trying to build larger endowments, so that more grants can be offered.
“We’re actively trying to do that, but we receive much less support than we’d like,” Taylor said. “This is an issue that concerns us greatly. It’s just not easy to figure out a solution.”
