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With all of the discussion about "is it worth it"? I thought I'd post an interesting article:
http://www.postgradmed.com/issues/2000/12_00/editorial_dec.htm
Many graduating medical students and residents must feel as if they are caught in a similar predicament: After years of academic toil, they graduate only to find they must work longer and harder than they anticipated to achieve freedom from educational loans. Unfortunately, a high debt load isn't the most dramatic disappointment today's graduates face. Because of changes within the medical profession over the past several years, physicians face an increased mountain of paperwork, more demands from regulatory agencies and third-party payors, diminished reimbursement, and--most disappointing--less time to spend with patients. The satisfaction that was once so inherent in our profession appears to be increasingly fleeting. It is little wonder that many graduates are dismayed to find that life after residency is not everything they expected.
It appears that Jacob was willing to work twice as long as he originally expected because he felt the ends justified the means. However, it is difficult for many young physicians to work longer and harder to repay educational loans once they realize that the actual practice of medicine is not what they anticipated. Their unrealized dreams, coupled with unpaid bills, can result in professional disillusionment and frustration.
Staggering debt loads
The actual debt load many of our young colleagues face can be staggering. About 65% of students in both public and private medical schools are in the red by at least $50,000 when they graduate, according to the 1999 medical school graduation questionnaire sponsored by the Association of American Medical Colleges (AAMC) (1) (table 1). The report found that only 16% of medical school seniors managed to graduate without debt in 1999. The remainder of their classmates weren't so lucky; these students owed, on average, $90,745 in educational debts. This is roughly 6% more than the average indebtedness claimed by survey respondents just 1 year earlier. On the high end, 12% of the students surveyed in 1999 were $150,000 or more in the red. (Things aren't looking too good for the class of 2000, either. The AAMC's latest data indicate that students who carry educational loans owe an average of $94,901.)
Table 1. Total educational debt of medical school students at graduation, 1999
Debt load* % of graduates**
None 16.1
$1-$24,999 5.9
$25,000-$49,999 10.9
$50,000-$74,999 14.3
$75,000-$99,999 19.1
$100,000-$124,999 15.2
$125,000-$149,999 6.8
$150,000 or more 11.7
--------------------------------------------------------------------------------
*Average total educational debt of all indebted graduates: $90,745.
**Total responses: 12,468.
Data from Association of American Medical Colleges (1).
--------------------------------------------------------------------------------
Compared with the past, today's lending environment is relatively favorable, the AAMC points out. Interest rates are low, the borrowing process is simpler, dollars are more readily available and, once completed, online loan applications often carry over from one year to the next. Most students who carry loans accept them as an inevitable part of the educational process. Perhaps this mirrors our society's current general acceptance of borrowing and debt as a way of life.
But for a young physician, high loan payments can be like an additional home mortgage. Payback can take 10 to 30 years, and depending on the plan, reimbursement can easily total from about 175% to 300% of the initial loan.
Show me the money!
How do future medical school graduates expect to manage their loan repayment obligations? A 1999 survey of 300 senior residents in family practice, internal medicine, and pediatrics (2) found that 40% expected to earn between $101,000 and $125,000 in their first year of practice. Another 26% expected to earn $126,000 to $150,000, and 22% said they expected to earn more than $151,000 in their first year. These salary expectations were much higher than those expressed by respondents in previous years and, more important, are higher than what is realistic according to study findings.
Without the counterbalance of professional satisfaction, high debt load can disproportionately influence which career path a graduate takes. Most physicians who are not in primary care still receive higher starting salaries than internists, family physicians, and pediatricians. A graduate who owes $150,000 is almost certain to have that debt load in mind when choosing a specialty and deciding whether to accept a fellowship, where to practice geographically, and whether to care for the underserved in a rural or inner-city setting. Loan payments can look far more feasible, depending on the circumstances being considered.
Disconnectedness among the ranks
How many of us who have practiced medicine for 20 or more years can say that we truly relate to the circumstances facing medical school graduates in 2000? When we left medical school, we had far less debt--if any--and entered a job market in which options were numerous and varied. We had only to name our specialty and we had multiple job offers. Since then, however, the average educational debt load of medical school graduates has risen steadily (table 2).
Table 2. Educational indebtedness of medical school graduates
Year Average debt of indebted graduates
1985 $29,943
1986 $33,499
1987 $35,621
1988 $38,489
1989 $42,374
1990 $46,220
1991 Not available
1992 $55,859
1993 $59,885
1994 $63,434
1995 $69,059
1996 $75,103
1997 $80,462
1998 $85,170
1999 $90,745
--------------------------------------------------------------------------------
Data from The AAMC data book: statistical information related to medical schools and teaching hospitals. Washington, DC: AAMC, 2000:48
--------------------------------------------------------------------------------
On the other hand, medical school graduates in 2000 seem to view money and work differently than earlier graduates. For example, years ago on-call duty every two or three nights was an inevitable, expected, and mostly uncompensated professional service for a new doctor. It was one of the best ways to meet new patients and build a practice. Today, many contracts define "call duty" and limit it to several nights a month. Extra call duty warrants extra money. This close connection between call duty and dollars is understandable and perhaps appropriate, but it also can change the implicit "contract" between patients and primary care physicians.
During residency training an additional "double jeopardy" may strike: Student loans become due, and the classic "delayed gratification syndrome" may seize both the new physician and his or her family. The desire to finally purchase a new house, start a family, or get a new car leads to an even greater debt burden.
It is little wonder that new physicians pay such close attention to the business and financial aspects of medicine. Debt payments stretch out ahead of them, and money management is a daily concern. It was far different for graduates of years ago, who believed the general tenet that if you worked hard and took good care of your patients and practice, you would do well financially.
What does it all mean for our profession?
First, I don't really know. The practice of medicine appears to be changing faster than the medical community can assimilate the changes. To achieve professional satisfaction, physicians must increasingly seek rewards that are broader and greater than personal financial security and a respected position in society. How do we share these perspectives with today's medical students? How do we prepare them for the realities they will face upon finishing school? Are there ways to achieve balance between one's professional educational costs and personal financial needs?
Those of us who are able need to invest in the upcoming generation of young physicians by helping them manage their debt load. We can do this by, for example, giving gifts to our medical school alumni foundation, supporting professional group subsidies (not loans) for students committed to serving the disadvantaged, or contributing to community efforts that offer debt repayment in return for service.
In addition to helping graduates manage their debts, we can help them manage their expectations. We can act as mentors and help them put the changing face of medicine in perspective. We can listen to them. When they complain about living under a cloud of debt, are they actually asking to be affirmed and validated in a world of uncertainty? We can assure them that the practice of medicine is indeed worthwhile and that caring relationships with patients remain a key source of renewal for the primary care physician.
http://www.postgradmed.com/issues/2000/12_00/editorial_dec.htm
Many graduating medical students and residents must feel as if they are caught in a similar predicament: After years of academic toil, they graduate only to find they must work longer and harder than they anticipated to achieve freedom from educational loans. Unfortunately, a high debt load isn't the most dramatic disappointment today's graduates face. Because of changes within the medical profession over the past several years, physicians face an increased mountain of paperwork, more demands from regulatory agencies and third-party payors, diminished reimbursement, and--most disappointing--less time to spend with patients. The satisfaction that was once so inherent in our profession appears to be increasingly fleeting. It is little wonder that many graduates are dismayed to find that life after residency is not everything they expected.
It appears that Jacob was willing to work twice as long as he originally expected because he felt the ends justified the means. However, it is difficult for many young physicians to work longer and harder to repay educational loans once they realize that the actual practice of medicine is not what they anticipated. Their unrealized dreams, coupled with unpaid bills, can result in professional disillusionment and frustration.
Staggering debt loads
The actual debt load many of our young colleagues face can be staggering. About 65% of students in both public and private medical schools are in the red by at least $50,000 when they graduate, according to the 1999 medical school graduation questionnaire sponsored by the Association of American Medical Colleges (AAMC) (1) (table 1). The report found that only 16% of medical school seniors managed to graduate without debt in 1999. The remainder of their classmates weren't so lucky; these students owed, on average, $90,745 in educational debts. This is roughly 6% more than the average indebtedness claimed by survey respondents just 1 year earlier. On the high end, 12% of the students surveyed in 1999 were $150,000 or more in the red. (Things aren't looking too good for the class of 2000, either. The AAMC's latest data indicate that students who carry educational loans owe an average of $94,901.)
Table 1. Total educational debt of medical school students at graduation, 1999
Debt load* % of graduates**
None 16.1
$1-$24,999 5.9
$25,000-$49,999 10.9
$50,000-$74,999 14.3
$75,000-$99,999 19.1
$100,000-$124,999 15.2
$125,000-$149,999 6.8
$150,000 or more 11.7
--------------------------------------------------------------------------------
*Average total educational debt of all indebted graduates: $90,745.
**Total responses: 12,468.
Data from Association of American Medical Colleges (1).
--------------------------------------------------------------------------------
Compared with the past, today's lending environment is relatively favorable, the AAMC points out. Interest rates are low, the borrowing process is simpler, dollars are more readily available and, once completed, online loan applications often carry over from one year to the next. Most students who carry loans accept them as an inevitable part of the educational process. Perhaps this mirrors our society's current general acceptance of borrowing and debt as a way of life.
But for a young physician, high loan payments can be like an additional home mortgage. Payback can take 10 to 30 years, and depending on the plan, reimbursement can easily total from about 175% to 300% of the initial loan.
Show me the money!
How do future medical school graduates expect to manage their loan repayment obligations? A 1999 survey of 300 senior residents in family practice, internal medicine, and pediatrics (2) found that 40% expected to earn between $101,000 and $125,000 in their first year of practice. Another 26% expected to earn $126,000 to $150,000, and 22% said they expected to earn more than $151,000 in their first year. These salary expectations were much higher than those expressed by respondents in previous years and, more important, are higher than what is realistic according to study findings.
Without the counterbalance of professional satisfaction, high debt load can disproportionately influence which career path a graduate takes. Most physicians who are not in primary care still receive higher starting salaries than internists, family physicians, and pediatricians. A graduate who owes $150,000 is almost certain to have that debt load in mind when choosing a specialty and deciding whether to accept a fellowship, where to practice geographically, and whether to care for the underserved in a rural or inner-city setting. Loan payments can look far more feasible, depending on the circumstances being considered.
Disconnectedness among the ranks
How many of us who have practiced medicine for 20 or more years can say that we truly relate to the circumstances facing medical school graduates in 2000? When we left medical school, we had far less debt--if any--and entered a job market in which options were numerous and varied. We had only to name our specialty and we had multiple job offers. Since then, however, the average educational debt load of medical school graduates has risen steadily (table 2).
Table 2. Educational indebtedness of medical school graduates
Year Average debt of indebted graduates
1985 $29,943
1986 $33,499
1987 $35,621
1988 $38,489
1989 $42,374
1990 $46,220
1991 Not available
1992 $55,859
1993 $59,885
1994 $63,434
1995 $69,059
1996 $75,103
1997 $80,462
1998 $85,170
1999 $90,745
--------------------------------------------------------------------------------
Data from The AAMC data book: statistical information related to medical schools and teaching hospitals. Washington, DC: AAMC, 2000:48
--------------------------------------------------------------------------------
On the other hand, medical school graduates in 2000 seem to view money and work differently than earlier graduates. For example, years ago on-call duty every two or three nights was an inevitable, expected, and mostly uncompensated professional service for a new doctor. It was one of the best ways to meet new patients and build a practice. Today, many contracts define "call duty" and limit it to several nights a month. Extra call duty warrants extra money. This close connection between call duty and dollars is understandable and perhaps appropriate, but it also can change the implicit "contract" between patients and primary care physicians.
During residency training an additional "double jeopardy" may strike: Student loans become due, and the classic "delayed gratification syndrome" may seize both the new physician and his or her family. The desire to finally purchase a new house, start a family, or get a new car leads to an even greater debt burden.
It is little wonder that new physicians pay such close attention to the business and financial aspects of medicine. Debt payments stretch out ahead of them, and money management is a daily concern. It was far different for graduates of years ago, who believed the general tenet that if you worked hard and took good care of your patients and practice, you would do well financially.
What does it all mean for our profession?
First, I don't really know. The practice of medicine appears to be changing faster than the medical community can assimilate the changes. To achieve professional satisfaction, physicians must increasingly seek rewards that are broader and greater than personal financial security and a respected position in society. How do we share these perspectives with today's medical students? How do we prepare them for the realities they will face upon finishing school? Are there ways to achieve balance between one's professional educational costs and personal financial needs?
Those of us who are able need to invest in the upcoming generation of young physicians by helping them manage their debt load. We can do this by, for example, giving gifts to our medical school alumni foundation, supporting professional group subsidies (not loans) for students committed to serving the disadvantaged, or contributing to community efforts that offer debt repayment in return for service.
In addition to helping graduates manage their debts, we can help them manage their expectations. We can act as mentors and help them put the changing face of medicine in perspective. We can listen to them. When they complain about living under a cloud of debt, are they actually asking to be affirmed and validated in a world of uncertainty? We can assure them that the practice of medicine is indeed worthwhile and that caring relationships with patients remain a key source of renewal for the primary care physician.
hey, i was wondering what the 16% of students do that allows them to graduate debt free?
May I ask where you got the info on Iowa law grads? Do you have a link? Thanks.
