Presentation on AF HPSP

[AF M4]

So the president of my med school's military medical student association (he's an Army HPSPer, nice guy) gave me a call the other day, asking if I would give a talk to the M1-M3 HPSP students about the program and what to expect/plan for going on ADTs, the match, etc. No problem, I said, glad to do it.

"Oh yeah, there's going to be a recruiter there too and maybe some incoming students thinking about the HPSP," he said, "so you might want to include something in your presentation for them."

Long pause.

"An Air Force recruiter?" I asked.

"Yeah," he replied.

Pause.

"Is he bringing pizza?" I asked.

"I hinted that it would be a good idea, but he was kind of hedging."

(Cheapskate.)

"You know this is not going to be a happy talk," I said.

"I know," he said. "But they should hear it."

So I get the chance to do what I wish someone had done for me 4 years ago - give a fair and complete look at the HPSP program without glossing over of any of the downsides. I've got a ton of material from my own experience and the posts on this board, and if anyone wants to chime in with points they wish someone had emphasized to them when they were considering the contract that would be great.

Heh, never a good sign for an organization when its members go out of their way to dissuade others from joining.

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Members don't see this ad.

 

[Galo]

Unfortunately just telling the truth may make alot of people uncomfortable. I hope you do not feel retribution, but its better to learn now to keep your integrity and honesty, than learning to hide the truth.

I wish you the best, and I wish I could be there.

 

[met19]

Unfortunately just telling the truth may make alot of people uncomfortable. I hope you do not feel retribution, but its better to learn now to keep your integrity and honesty, than learning to hide the truth.

I wish you the best, and I wish I could be there.

sweet


no really i hope the recruiter realizes he/she is walking into a possible unfriendly crowd and that the BS regarding HPSP won't stand

 

[West Side]

I would be absolutely sure to emphasize the existence of this, and other, websites. Encourage them to do a little digging.

And I would make sure to run the numbers for them. There are few 21 year olds that have even a passing familiarity with leverage and the advantages of debt. Try and explain that to them.

Try and provide as faithful a counterpoint as possible to the avalanche of BS they're going to get from the recruiter. This is your only "touchpoint", so make it worth it!

 

[The White Coat Investor]

]

 

[AF M4]

West Side - I'm not that familiar with the ideas of leverage and the advantages of debt myself, could you explain the concept so I can include that in my presentation too? Thanks. I want this to be the talk someone had given me a few years ago.

 

[West Side]

I actually thought Desperado did a pretty thorough job of a financial analysis here:

http://forums.studentdoctor.net/showthread.php?t=351167&highlight=financial

As I'm not as familiar with feasible growth rates for civilian compensation, so I couldn't really give these numbers the smell test.

I think the one real problem with Desperado's analysis is that it doesn't take into account the effect of time: as you're aware, a dollar today is worth a heck of a lot more than a dollar in 7 years.

As far as leverage goes, the critical thing to understand that the real difference between HPSP and the normal route is that the cashflow differences only manifest themselves when you have to make payments. Think about it this way: assuming you can borrow your entire need as a civilian, you don't actually pay for med school in the first four years. You pay for it in small increments for the next 25 years. In essence, the bank takes the place of the military.

The best way to look at this is to discount the cashflows. Just as income out in the future shrinks in today's value on a present value basis, so do debt payments. The advantage here is that, while debt payments stay fixed, your income will grow. Civilian growth rates should outpace fixed government pay schedules; it's the reason we don't all work at the post office, a tradeoff between job security and potential for growth. As such, assuming the growth rate outpaces the interest rate, you'll enjoy "positive leverage". That is, the growth in your return outpaces your cost of money.

I threw together a VERY rudimentary DCF, and assuming Desperado's numbers are roughly accurate, it definitely pencils to take the civilian route, to the tune of around $158,000 more at the start of med school. I've assumed equal living expenses once out of the military/school; maybe I should throw that into the analysis, but I doubt it's going to make much of a difference. And that doesn't even factor in the loss of autonomy, lack of geographic stability, and (debatably) lower quality of training, all things that would contribute to financial success in the private sector.

You can PM me if you need a better explanation. The short answer: student debt, ESPECIALLY NOW, is the cheapest money you're going to see. Given the financial upside to being almost all species of doctors, and the strong growth prospects for medical compensation, one is essentially borrowing the lion's share of the cost for free, or close to it. The quickest way to distill it: the government doesn't ever do you any favors. Why would they be jumping at the chance to lay out $200,000?

Note: I did a 20 year analysis, Year 1 being year 1 of med school.

 

[Ex-44E3A]

Concur with Desperado's advice. Many of their questions and concerns have been hashed out in this forum.

Advise them to read carefully, and digest the results before signing anything... it's the closest thing they're going to get to full disclosure.

 

[basicscikills]

Might be good to mention that you may not match in a specialty that you want or to which you'd be suited. I'd be an absolutely terrible psychiatrist, but if the AF says psych, I have very little say in the matter. Also, COT is not a cakewalk. The recruiters paint a far rosier picture than what it is now. It's hot as hell in Alabama, believe me. Finally, be sure to mention that your stipend is at the whim of the people at AFIT, who will cancel it at the drop of a hat if something comes up on your paperwork. I had mine held up for a month in the middle of freshman year because they hadn't gotten a letter from my dean telling them when our semester ended so that I could attend COT. Never mind that the dean's office swore that they'd sent it. I had to do without any money for a month until they finally received another one.

One more thing....I think people need to know that they might be commanded by a nurse who thinks they know more about patient care than any physician and possibly by someone with no medical background who thinks they can make patient care decisions.