20/220 Pathway Bill

[emeddo]

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Members do not see this ad.

The American Osteopathic Association has released an alert for how you can help reestablish the 20/220 pathway that makes it easier for medical residents to defer student loans during residency. This is of great importance to any future residents so please take a look at it and contact your representatives regarding the issue if so inclined.

http://ohpi.emeddo.com/2009/04/get-involved-now.html

 

[UserNameNeeded]

I hope everyone who visits this forum follows that link and sends those letters to their respective senators and representatives in congress. And please forward it to your classmates, so they do the same!!

We need this 20/220 rule back so, among other benefits, we can actually get 0% interest rate deferrals on our subsidized Staffords during 3 years of residency. That should save us thousands of dollars in interest. 2 minutes of your time to do this could equal $7,000 of interest on those loans!

 

[GeraldMonroe]

I'd like to be able to defer my loans like everyone else, but I do have to comment on the obvious.

That $7000 comes from the Federal budget, and originally from taxpayers. The reason Congress eliminated the 20/220 pathway in the first place was because the rule almost exclusively applies to health professionals, who don't need to be offered a subsidy. Fact is, medical/dental/optometry/pharmacy and other schools have been full, year after year, with thousands of people rejected each year.

I don't like to argue against my own well being, but the fact is, they do have a point.

 

[emeddo]

The reason Congress eliminated the 20/220 pathway in the first place was because the rule almost exclusively applies to health professionals, who don't need to be offered a subsidy.

I was told that the reason this was eliminated was for an entirely different reason and was wondering where you source was for this information. I don't have a reliable source for mine, so would appreciate any link to credible information as to why the elimination of this rule happened in the first place. This may help us all understand what is going on in the first place. Thanks

 

[GeraldMonroe]

I can't seem to find a search term that finds it on google. In essence, a member of Congress stated that M.D.s don't need a subsidy. It is true that it's possible to rack up high student loan bills in other fields, but nearly all of them are for high paying jobs. "Mysteriously", the private school I am at charges lower tuition and fees to students for lower paying fields such as P.T., even though the actual cost to the school has to be similar.

 

[gstrub]

In essence, a member of Congress stated that M.D.s don't need a subsidy. It is true that it's possible to rack up high student loan bills in other fields, but nearly all of them are for high paying jobs.

Congress said that? Well then it MUST be true!

 

[daru1]

Could you PLEASE give a source as to why this rule is being eliminated rather than just saying, "Someone in Congress says we don't need subsidies."

I can't believe I just read that. I want my minute of time you just wasted back.

 

[GeraldMonroe]

I'm trying to find it, I did read it, I just can't seem to find the news article. In any case, it kind of seems like the cold, hard facts don't support a subsidy.

1. Medical schools are full at the current price and loan burden. In the far future, if applicant quality and numbers fell to where schools were barely filling, and high cost was the reason, then a subsidy might be appropriate then. But last application cycle was one of the most competitive ones in 10 years, with very high MCAT and GPA averages, and a large number of applicants who did not make it.

2. Some say a subsidy is needed in order for doctors to do primary care. That is sort of true. However, the reason there are not enough primary care doctors is actually because there are not enough primary care residency slots. If more slots were created, then someone would fill every last one of them. Even if "someone" was D.O.s or IMGs from countries where medical school is cheaper, such as India. If AMGs wanted to do primary care more, then IMGs would be filling surgery and other specialty spots instead. In any case, if the country needs more primary care, all Congress would have to do is to fund more residency slots. They would not need to subsidize medical school.

Look, I'm going to owe over 200k just like the rest of you. Roughly 225k or so on the day I graduate, and the debt will get worse from there if I do a long residency. I wish I could get it subsidized, because I would benefit greatly. With that said, I can see both sides of an argument, and the side that goes against my own personal well being is unfortunately the one that is correct.

I don't want to pay 50% taxes and then have to pay a $3000 monthly student loan payment. That would be terrible. However there are reasons that the government will probably make me do both of these things. The 50% taxes will be because incompetent politicians have run up a huge national debt that has to be paid somehow. The high loan payment will be because Congress will decide that I don't need a subsidy for the reasons I listed above.

 

[Bleurberry]

Could you PLEASE give a source as to why this rule is being eliminated rather than just saying, "Someone in Congress says we don't need subsidies."

I can't believe I just read that. I want my minute of time you just wasted back.

 

[daru1]

However, the reason there are not enough primary care doctors is actually because there are not enough primary care residency slots.

Another minute you need to pay me back for. This statement shows your ignorance of the entire situation about primary care. I see it says both MS0 and Medical Student in your profile. While neither of these may be true, you need to do more research before you throw out your 'facts'.

 

[emeddo]

Another minute you need to pay me back for. This statement shows your ignorance of the entire situation about primary care. I see it says both MS0 and Medical Student in your profile. While neither of these may be true, you need to do more research before you throw out your 'facts'.

Though I would not be as harsh about it, I have to completely agree that the statement about their not being enough spots is completely inaccurate in regards to students not going into primary care.

 

[emeddo]

Another minute you need to pay me back for. This statement shows your ignorance of the entire situation about primary care. I see it says both MS0 and Medical Student in your profile. While neither of these may be true, you need to do more research before you throw out your 'facts'.

Though I would not be as harsh about it, I have to completely agree that the statement about their not being enough spots is completely inaccurate in regards to students not going into primary care. I would however say this argument should be saved for different threads and we should focus back on this 20/220 pathway. Thanks

 

[GeraldMonroe]

In one sentence, can you explain to me what I'm missing? Yes, primary care is the pits, and I don't know any AMGs who want to do it. However, the IMG pool is nearly limitless. So's the applicant pool to med school in the U.S.

You could create more primary care at the current price with a couple of strokes of a pen. Just open up more med school seats in the U.S., and create only new primary care residency slots. Further, the more new primary care residency slots you create in excess of U.S. graduates, the more IMGs are able to match. Hordes of IMGs would start attending med school in Russia and India and other places, and they would, for a chance to make $150,000 in the U.S.

 

[gstrub]

In one sentence, can you explain to me what I'm missing? Yes, primary care is the pits, and I don't know any AMGs who want to do it. However, the IMG pool is nearly limitless. So's the applicant pool to med school in the U.S.

You could create more primary care at the current price with a couple of strokes of a pen. Just open up more med school seats in the U.S., and create only new primary care residency slots. Further, the more new primary care residency slots you create in excess of U.S. graduates, the more IMGs are able to match. Hordes of IMGs would start attending med school in Russia and India and other places, and they would, for a chance to make $150,000 in the U.S.

Worst. Idea. Ever.

 

[GeraldMonroe]

Well, it's either that or open up more med school seats. Either would fix the problem.

What wouldn't fix it is reinstating the 20/220 pathway. It wouldn't make the slightest difference, because the total number of primary care residency spots would still be the same.

 

[chiz2kul]

Could you PLEASE give a source as to why this rule is being eliminated rather than just saying, "Someone in Congress says we don't need subsidies."

I can't believe I just read that. I want my minute of time you just wasted back.

 

[gstrub]

Well, it's either that or open up more med school seats. Either would fix the problem.

What wouldn't fix it is reinstating the 20/220 pathway. It wouldn't make the slightest difference, because the total number of primary care residency spots would still be the same.

Who the hell gives a crap about how many primary care spots there are? They never fill anyway. With 250K in debt, and another 5+ years of training (read:indentured servitude), I should be able to defer my interest as promised. Remember, that's what they told us we could do when we borrowed it. Now they changed their minds, and we're getting the shaft.

 

[MedMan25]

In one sentence, can you explain to me what I'm missing? Yes, primary care is the pits, and I don't know any AMGs who want to do it. However, the IMG pool is nearly limitless. So's the applicant pool to med school in the U.S.

You could create more primary care at the current price with a couple of strokes of a pen. Just open up more med school seats in the U.S., and create only new primary care residency slots. Further, the more new primary care residency slots you create in excess of U.S. graduates, the more IMGs are able to match. Hordes of IMGs would start attending med school in Russia and India and other places, and they would, for a chance to make $150,000 in the U.S.

Not sure where you're getting this from. There are unfilled positions every year in primary care. Opening up more residency programs wouldn't do a thing.

 

[dragonfly99]

the 20/220 pathway has gone away, and I don't think will come back.
The elimination of this was fought hard by the AMA medical student section and the AMSA. They lost, because as Gerald Munroe points out, the politicians did not see a need to keep it, and it seemed unfair to people studying in other fields (i.e. why should doctors get a special deal). It actually was only allowed to defer the student loan interest for a couple of years, anyway, so it didn't save THAT much money. However, even several hundred dollars a year is helpful when you are a resident. This 20/220 thing was replaced with "income-based repayment" which was felt to be more fair and equitable (by the politicians). Under income based repayment you can only be forced to pay a certain %age of your income toward your loans, so that while you are in residency you don't have to pay your full loan payments. However, this isn't as good as the old 20/220 pathway, which had the gov't paying the interest on your subsidized Stafford loans during your first couple years of residency.

As far a fix for primary care goes, creating more residency spots won't fix that. As someone mentioned above, there are a lot of spots that still go unfilled. We need to make the PRACTICE of primary care more desirable...this could happen by some combination of paying primary docs a bit more, making them see fewer patients/day (these first two are related, for obvious reaons), not forcing them into the role of "evil gate keeper" as they are forced to be in some HMO's and other systems like the VA, giving them more respect (within the medical community and from the general public), and diminishing the paperwork burdens on primary physicians, which seems to be worse than in most other specialties.

 

[osli]

I'm sending a letter and making a call to my senators and representatives, but to be honest I really don't care. I'll have a huge debt upon graduation, and thanks to the new administration and the popular opinion that "doctors are rich greedy bastards..." I probably won't make enough to pay back the loans even with a few pennies chipped in by the government during residency. The interest accrued during those three years, which I will certainly not pay but instead just let it pile up under forebearance, will be a drop in the bucket compared to the total. I'll make payments as large as I can, but with reimbursement falling I'll be making those payments for the rest of my life with no hope of retiring. Perhaps I'll suffer some sort of debilitating illness that will allow me to sit in a chair and watch TV while collecting disability. Or perhaps I'll try to round, cut, read, or whatever until I can't see, or walk, or my hands shake to badly. Or until I can't get malpractice coverage. Either way, I probably stand no chance of actually paying back my loans. My children will inherit them, and they probably won't be able to pay them either, especially if they decide to enter the field of medicine. So why do I care that the total will be a bit higher? I'll let my great grandchildren fight that battle.

Thanks America.

 

[GeraldMonroe]

My children will inherit them, and they probably won't be able to pay them either, especially if they decide to enter the field of medicine.

Student loans are discharged at death.

I know it feels like the wind is blowing against doctors and gradually making things worse in every way, but it's not all bad. It still is a job that one can love to do, and it pays well enough that one can live in a house, save for retirement, and provide well for the kids. Even after making the loan payments.

 

[osli]

I forgot to add that as physician payment plummets, we will carry an increasingly higher percentage of the tax burden as the marginal rates rise. Greedy rich docs, they can afford anything.

I know it feels like the wind is blowing against doctors and gradually making things worse in every way, but it's not all bad.

You're right... there's that death thing you mentioned, so I suppose there is still some hope left.

 

[Gibbles]

Here's an idea. Use the IBR program for three years, so you don't accrue interest on your subsidized loans. Make the minimum monthly payment required while also making payments on the interest of your unsubsidized loans.

Finish residency or do a fellowship...whatever.

Then, when you're all done (even if you work in primary care) live like you only make $80,000-$100,000 per year and get your loans payed off within 5 years.

That's what I'm going to do as a future Internist. This isn't that hard. Luckily for me, working in primary care (especially Internal Medicine in the region that I want to work in) almost guarantees that someone else will be repaying my loans for me.

If you went into or plan on Orthopaedics, Radiology, or Dermatology and you're complaining right now, then you need to stop complaining and give us all a break. You can have your loans repayed within 2-3 years...easily.

 

[Sol Rosenberg]

Student loans are discharged at death.

On top of that, it is not possible to inherit ANY debt. I'm not sure from where that [fairly common] misconception has arisen.

 

[GeraldMonroe]

On top of that, it is not possible to inherit ANY debt. I'm not sure from where that [fairly common] misconception has arisen.

But your creditors can seize assets after you die in order to pay said debts. Only the remnants of your estate after your creditors are paid go to your heirs.

This is evidently not true for student loans : if you had $500,000 in assets and a million in student loans at death, your heirs would get the $500,000.

 

[UserNameNeeded]

Here's an idea. Use the IBR program for three years, so you don't accrue interest on your subsidized loans. Make the minimum monthly payment required while also making payments on the interest of your unsubsidized loans.

IBR doesn't prevent interest from accruing on subsidized loans. The 20/220 pathway does through deferrment! That's what we're trying to reinstate.

IBR has no benefits and interest accrues on all Staffords. IBR just guarantees a portion of whatever income you earn goes to loan repayment. No interest savings, no deferrals.

 

[CME2P]

But your creditors can seize assets after you die in order to pay said debts. Only the remnants of your estate after your creditors are paid go to your heirs.

This is evidently not true for student loans : if you had $500,000 in assets and a million in student loans at death, your heirs would get the $500,000.

trust fund people.....trust fund

 

[TMP-SMX]

IBR doesn't prevent interest from accruing on subsidized loans. The 20/220 pathway does through deferrment! That's what we're trying to reinstate.

IBR has no benefits and interest accrues on all Staffords. IBR just guarantees a portion of whatever income you earn goes to loan repayment. No interest savings, no deferrals.

We'd love for it to come back, but it isn't happening. I think the point he was making is to at least pay off the interest during residency so that it doesn't build. Either way, it is a good idea to be making payments.

 

[Sol Rosenberg]

But your creditors can seize assets after you die in order to pay said debts. Only the remnants of your estate after your creditors are paid go to your heirs.

This is evidently not true for student loans : if you had $500,000 in assets and a million in student loans at death, your heirs would get the $500,000.

1. You do realize that this is not the same as inheriting debt, right?

2. Why is this a bad thing? (Assuming that the debt(s) in question is (are) legitimate.) The dischargible upon death provision of Stafford Loans is a nice gift from the banks to the heirs of the borrower.

 

[GeraldMonroe]

1. You do realize that this is not the same as inheriting debt, right?

2. Why is this a bad thing? (Assuming that the debt(s) in question is (are) legitimate.) The dischargible upon death provision of Stafford Loans is a nice gift from the banks to the heirs of the borrower.

Well, an earlier poster was bemoaning how his grandchildren would inherit his loan debts. I pointed out that for most debts, this is sort of true : either your estate has enough net worth to pay your debts after death, or the grandkids inherit absolutely nothing. But it's not true for Federal loans, which is one more reason the 6.8% interest isn't as bad as it looks at first.

 

[osli]

In case it was lost on some, there was a heaping dose of sarcasm along with a sprinkling of honest disgust in my posts. I'm sure I'll be able to pay my loans, I just didn't figure I'd be forced into doing it during residency on a salary half what I made before med school and now with a family of four.

 

[Sol Rosenberg]

In case it was lost on some, there was a heaping dose of sarcasm along with a sprinkling of honest disgust in my posts. I'm sure I'll be able to pay my loans, I just didn't figure I'd be forced into doing it during residency on a salary half what I made before med school and now with a family of four.

You're not forced into doing it. Your loans can be in forbearance. The only difference is that, in forbearance, interest is compounded rather than capitalized. OK, on subsidized Stafford loans, interest accrues (is compounded) but subsidized Stafford loans are not the most significant part of medical school debt (max $34k.)

 

[osli]

You're not forced into doing it. Your loans can be in forbearance. The only difference is that, in forbearance, interest is compounded rather than capitalized. OK, on subsidized Stafford loans, interest accrues (is compounded) but subsidized Stafford loans are not the most significant part of medical school debt (max $34k.)

This is what I was hoping was the case, but to be honest I haven't read a clear description of what effects IBR will have. In some discussions it is easy to interpret the information being thrown about as being forced to make at least a portion of the payment, regardless of whether you want to or not. Forbearance isn't a particularly nice thing, but to be honest the difference in interest between deferment and forbearance is a fairly small drop in the bucket compared to the total debt I'll be faced with. In the end, another month's student loan payment isn't going to make or break me, but the principle is rather aggravating.

I understand the reasoning behind "doctors don't need a subsidy" but I think it is lost on many just how long and difficult and costly of a process this is. We put our lives and sometimes our families' lives on hold for years and years. Realistically, no matter what specialty you go into, you're facing a full decade after undergrad before you "enjoy" any fruit from your years of grueling work. Assuming you've found time to meet a significant other, or start a family, or if you had one hopefully kept it intact during the process, after ten years you might actually be able to "start" a normal life. Of course, at that point you're going to be working long hours, getting taxed heavily to pay for the portion of our society that can't or won't support themselves, and have the backhanded distinction of simultaneously being thought of as a "prestigious" professional, and a greedy money hungry bastard that can afford to pay for everyone else's vices.