Student Loans Paid by Hospitals?

[SangriaSalsa]

I will be a first year medical student this summer. I have reviewed some job postings for my local hospital (fairly rural) and multiple positions offer 100-200k student loan repayment along with the salary and benefits package. I was thinking about trying to make some payments on my loans during residency or if my wife is willing to help out during medical school, but with the possibility of having most of my student loans paid for (I hope to practice in my area), is it just throwing money down the drain if I pay some of my loans during medical school or residency? Thanks

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[alexlex143]

I'd like to know this too! My mom works at a county hospital and one of the docs she works with said that over 10 years, they will pay upwards of 90% of his med school debt (per her, his debt is around 300-400k if I'm not mistaken) on top of salary, benefits, etc.

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[ndafife]

I will be a first year medical student this summer. I have reviewed some job postings for my local hospital (fairly rural) and multiple positions offer 100-200k student loan repayment along with the salary and benefits package. I was thinking about trying to make some payments on my loans during residency or if my wife is willing to help out during medical school, but with the possibility of having most of my student loans paid for (I hope to practice in my area), is it just throwing money down the drain if I pay some of my loans during medical school or residency? Thanks

Yep. Rural hospitals that have trouble recruiting physicians will sweeten the pot. Some will offer tuition relief and or a stipend for medical students who sign contracts during medical school. Others, as you obviously are seeing, will offer student loan repayment as incentives.

The student loan repayment is a nice benefit assuming the stipulations behind it are agreeable to you (work here for X number of years for example).

 

[ndafife]

Pre-employment contracts arent as good of a deal. They often lock you into a salary below market value for the area in exchange for tuition help and stipends during school. They also are tough to break should you have a change of heart about the area/specialties available there, and end up with you needing to pay things back with interest.

 

[SangriaSalsa]

Oh ok I didn’t know they provided tuition assistance before employment. So I guess I’ll hold off on paying any student loans until I become an attending physician, and just save $ for a more certain expense like a down payment on a house? I might contact my local hospital now and ask about how negotiable loan payment is. Thanks!

 

[ndafife]

Oh ok I didn’t know they provided tuition assistance before employment. So I guess I’ll hold off on paying any student loans until I become an attending physician, and just save $ for a more certain expense like a down payment on a house? I might contact my local hospital now and ask about how negotiable loan payment is. Thanks!

These are very individual cases based off of each and every hospital's situation and location. And that seems like a good idea, the only way to learn about it is, to talk to the hospital in question and figure out what they are able to offer.

 

[Stagg737]

Oh ok I didn’t know they provided tuition assistance before employment. So I guess I’ll hold off on paying any student loans until I become an attending physician, and just save $ for a more certain expense like a down payment on a house? I might contact my local hospital now and ask about how negotiable loan payment is. Thanks!

If you can afford to minimize your debt or pay off interest during residency, I don't think that's a bad idea even if you plan on taking a job with loan repayment options. My personal opinion is not to rely on loan repayment options existing when you get out and to assume you will have to pay back the full amount of your loans.

I'm also pretty weary of the programs which promise to pay for part of your tuition like HPSP though. They usually require a pretty significant commitment early on which locks you into a specific pathway. If you change your mind and decide to drop the deal, the penalties can be pretty incredible. Still, you shouldn't worry too much about repaying loans unless you've got a huge family or are accruing massive debt (400k+). Unless you go into a highly saturated market (think NYC or SF) or a field with low demand (like pathology), you're very likely going to have a lot more bargaining power when you finish residency than you realize, especially if you want to practice in more rural areas or fields with very high demand (like FM and psych).

 

[Tenk]

You really shouldn’t worry about this. All the student loan repayments these hospitals offer are not tax free. Take out a good 30-40% of that for taxes depending on your bracket and state taxes. You’ll have plenty to pay back on your own!

Welcome to taxes. It sucks.

 

[3toedsloth]

These payoff schemes are usually substantial for psych, family med, and maybe internal med in less desirable areas/less desirable hospital systems.

Don't take loans with the hope that your hospital will pay them off. Any place that's willing to give you sign on Loan payoff would also be willing to give you a sign on bonus of the same amount. You're much better off financially and have more professional freedom by just acting in a financially responsible way from the beginning.