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Why You Shouldn't Base Your Choice of School or Specialty Soley on Loan Debt

Discussion in 'Pre-Medical - DO' started by TweetyPie, Apr 29, 2007.

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  1. TweetyPie

    TweetyPie ` 10+ Year Member

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    School/Specialty Choice vs. Total Loan Debt:

    Even though I jokingly posted on another thread re: UNECOM's yearly tuition hikes, do not exclude choosing a school/specialty (even FP) based solely upon your perceived ability to pay off loans. Why? Here are some reasons:

    (a) Let's use an FP starting salary of 120k (conservative) as an example, assuming FFEL loans (Stafford, PCL, etc), a 6.8% APR, a 25 year term ("extended payment") of $300K (high end) of med school debt. I'll do the numbers:

    Monthly loan payment on $300K = $2082 x 12 = $24,984/year (21%) less 120k FP salary, is $95,016 leftover.

    That's equivalent to making a salary of $25,000 and if you had a monthly bill of $437.50 (21% of $25,000). Heck, that's about the amount of a car payment. And, $95,016 is not bad career-starting salary at 29 years old! And of course, an FP doc's salary is guaranteed to go up year to year.

    You see, we youngsters have a skewed perspective about money. We see $300,000 dollar debt and freak out. But you have to remember we'll be making a heck of a lot more than the average Joe out there with the potential of making much more by the time we retire.

    (b) A second reason for not making money a sole criterion for choosing a school/specialty is there are some federal, and many state programs, as well as medical groups, as part of their compensation package, that offer partial or full loan forgiveness where they will pay off your loans.

    With respect to choosing a specialty only, once you are in 3rd/4th year rotations go with the specialty that fits you then, where your innate skills and passion takes you. That's where you will be most happy.
     
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  3. ScFm546

    ScFm546 5+ Year Member

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    I vote that we sticky this thread or make a sticky that contains similar info. Excuse me if there already is one.

    -Redox
    !!!KCUMB 2012!!!
     
  4. Dr JPH

    Dr JPH Banned Banned 10+ Year Member

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    A doc making $120,000 will be lucky to take home $80,000 after taxes.

    Once your salary hits a certain level any tax breaks from student loans are gone.

    What about retirement? That comes out of your paycheck as well.

    Mortgage, car, malpractice insurance, etc. All adds up

    Your intentions are good but your thought process is skewed.

    Sticky this thread? Hardly.
     
  5. Dr JPH

    Dr JPH Banned Banned 10+ Year Member

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    :rolleyes:

    These programs are not as common as you may think. And they come with pretty binding contracts. Dont think that you can just call up a hospital and they will pay off your loans.


    Agreed. Your post is not completely wasted.
     
  6. HarveyCushing

    HarveyCushing 7+ Year Member

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    I keep hearing people on the forum talking about how easy it is to get your loans paid back by the state/hospital. I have always wondered how true that is. Is this something that one can actually look into as a med-student to get real answers? Aren't most loan repayment programs based off of them matching every dollar that you put in, rather than them paying all of it off?
     
  7. HarveyCushing

    HarveyCushing 7+ Year Member

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  8. Dr JPH

    Dr JPH Banned Banned 10+ Year Member

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    These programs arent easy.

    First of all, the government funded programs often require a primary care committment in an underserved area. YES you get to list your choices but THEY get to choose where you go.

    Private hospitals and communities that offer these things are full of condition. Must maintain a certain level of productivity, must maintain a certain number of patients, must sign a long term contract, must take call, must...you name it.

    Paying off $250,000 or more in loans is not something ANY organization is going to take on unless they KNOW they can make that money back in the same amount of time.

    They can use and abuse you if they see fit.
     
  9. Dr.Inviz

    Dr.Inviz Banned Banned

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    It's decently common in rural, underserved areas. I have no idea about urban areas, that's something JP may know. Yes, while they do make agreements to pay back your loan following residency (and do provide stipends), you are bound to work with them for 4-5 years. In some cases it may be good, but what if you get offered a nice contract in the hospital you're doing your residency at for you to sign-on once your residency is complete? Usually, the offers are nice from what I hear.
     
  10. Dr JPH

    Dr JPH Banned Banned 10+ Year Member

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    But what people usually hear is the salary. They dont hear everything that comes along with it. Trust me on this...I have researched it extensively.
     
  11. Dr.Inviz

    Dr.Inviz Banned Banned

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    From what you said, it sounds on par as being the hospital's personal bitch. Not my cup of tea. Thanks for the details.
     
  12. Dr.Inviz

    Dr.Inviz Banned Banned

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    Ah, duly noted.

    I keep hearing about salary and bonuses. I am sure there is the whole matter of insurance for malpractice, amongst other things. Would like to hear your side on the matter as according to your research.
     
  13. TweetyPie

    TweetyPie ` 10+ Year Member

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    :laugh: :laugh: Now why would you want to attempt to belittle someone's knowledge when:

    (1) You have no familiarity with anyone else's experience or knowledge;
    (2) You are a fourth year (just as I am) and;
    (3) There is a greater percentage of SDN'ers who have surpassed your mere first thru fourth year med school experience and knowledge, than of those who haven't i.e. interns, residents, fellows, & practicing docs.

    Folks, everyone's financial situation is going to be different i.e. family, investments, tax status, retirement schemes etc. with many variables. I, and many of you I'm sure are capable of sitting down and doing a thorough financial scheme, and then post it on this board. But who does that! I'm sure we will when the time comes. This JPHazelton is doing nothing more than throwing a bunch of variables into the issue to impress with his knowledge which really only impresses those who are just beginning to be introduced to this stuff.

    When you have a set of variables common to a group with more significant common factors that give greater weight, unless you want to do a thorough analysis, it will be necessary, and you will get a good enough estimate, by evaluating the significant common factors, only.

    Significant Common Factors: Higher than average professional salary, loan debt, loan payment, debt-to-salary ratio, and loan forgiveness/repayment. Within this context, when attempting for accuracy on an internet forum, it is foolish to throw in the common variables because that takes analysis.

    Bottomline: everyone regardless of what job they have whether in medicine or the migrant worker in the field are faced with paying for rent, housing, insurance, taxes, retirement plans....all the expenses (variables) attendant to living. In trying for accuracy (for those of us who are wise enough not to attempt a thorough analysis on an internet forum) you don't include these variable expenses because they are not what set physicians apart. Because an FP doc's starting salary is significantly higher than ~98% of the U.S. population and because you will have more choices than not with respect to loan forgiveness/repayment, you should not base your choice of school or specialty soley on loan debt.

    Wrong :sleep: Currently, the American Academy of Family Physicians is listing 27 private, group, or hospital positions that offer partial or full loan forgiveness/repayment incentives. This is pretty much a continual occurance, so if you want forgiveness/repayment it is not difficult to obtain.

    Further, there federal/state/other monetary incentive programs for work in underserved area to include Loan forgiveness/repayment in at least 45 of the 50 states.


    Why do you presume to think I need some sort of affirmation/aproval from you. :rolleyes:

    IMHO, I would caution pre-meds/med students to beware of people who (if I can use a colloquialism) "front" themselves in this manner.
     
  14. Dr JPH

    Dr JPH Banned Banned 10+ Year Member

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    You can say what you like Tweety but Im going to stick to reality.

    Student loan debt for any doctor, especially FP, is not something to take lightly.

    The fact is the numbers support what I am trying to get across to people.

    $2,000/month in loans
    $2,000/month (or more) for mortgage
    $400-500/month for car
    $300/month for bills
    Supplemental malpractice
    Expenses (food, gas, clothing)
    Now how about life insurance, disability insurance, car insurance, homeowners insurance
    401K and other retirement plans

    $6000/month net salary sounds great but once you start doing the math it goes quick. (And yes, I have personal experience with this)

    Have you researched these loan forgiveness programs? I know I have...quite a bit in fact. Ever read the small print? Its not for everyone.

    So you tell premeds to be wary of me? Thats fine.

    At least I am the one living in reality.

    Youre off in loan repayment fairy land. I hear the weather is nice.
     
  15. spicedmanna

    spicedmanna Moderator Emeritus 7+ Year Member

    I think that most would agree, and I certainly do; however, it would be wise to consider it as one factor. Excluding financial considerations completely from the decision might set erroneous expectations. I think one should know what one is getting into, fully. This is not to say that it is a powerful enough factor to sway me one direction or another; it probably won't. I'm going to go with what I love doing, after some experience.
     
  16. scottyd214

    scottyd214 2+ Year Member

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  17. Dr.Inviz

    Dr.Inviz Banned Banned

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    Let me know when he's actually ABLE to graduate without debt. The amount he's making won't even make a dent into that debt of his ...
     
  18. TweetyPie

    TweetyPie ` 10+ Year Member

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    Of course they want a commitment if you sign up while in med school and they pay for your tuition i.e. NHSC! Other than that your "commitment" is your employment contract. It appears that you're mixing up two things there, JP: med undergraduate degree fed/state programs and post residency employment :laugh:

    This is the second time you have lumped in all practice types into "hospitals". You do realize that there are other types of practices? Group, solo, HMO, locum tenens.... :eek:

    As far as post-residency employment, group practices is where you will find the majority of loan forgiveness/repayment options. They should be a part of your employment contract and should not be contingent upon income production bonuses. Again JP, it appears that you are a little mixed up :confused:

    As an aside, always have an attorney familiar with physician employment contracts review your contract.

    Complete overstatement....from someone who has not even graduated from med school yet. It is rare that you get abused once in practice. :rolleyes:

    You will be held to your contractual agreement, so again, the attorney....But in most cases contracts will adhere to what the standard is in your particular speciality. I think in most hospitals or groups do not want to sully their reputations by taking advantage of their physicians fresh from residency.

    You know, JPHazelton, you're at that stage where you have just enough information to hurt yourself (and others) :scared:
     
  19. Dr JPH

    Dr JPH Banned Banned 10+ Year Member

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    [edited]

    If you take the time to drop the sarcasm and have a real conversation about this issue, I might be interested in paying attention to what youre saying.
     
  20. scpod

    scpod Physician Moderator Emeritus 10+ Year Member

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    Yeah, but the AAFP also says there were nearly 3,500 family practice residency graduates in 2006. What do the other 3,400 do?


    Yeah, but the reason why they are "underserved" is because nobody wants to live there. And a look at some of the repayment details isn't too thrilling to me. Yet, if you look at the figures from the AAFP the place to make more money is in the rural areas, not urban. And practices that are doing more procedures are making tons more-- you're more likely to get into that in rural areas too. Plus, the decreased standard of living would give you more bang for your buck. So...it might be better to just skip the repayment program and set up in a rural area anyway.
     
  21. Dr JPH

    Dr JPH Banned Banned 10+ Year Member

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    Careful scpod...she will start throwing around sarcastic remarks about you too, you dumb 2nd year. ;)
     
  22. Dr JPH

    Dr JPH Banned Banned 10+ Year Member

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    Listen to people with common sense...like you and me! :laugh:
     
  23. scpod

    scpod Physician Moderator Emeritus 10+ Year Member

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    I've got a feeling I'm gonna get in trouble on this thread!:laugh:
     
  24. Dr JPH

    Dr JPH Banned Banned 10+ Year Member

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    :smuggrin:
     
  25. TweetyPie

    TweetyPie ` 10+ Year Member

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    Nobody even came close to saying take med school debt lightly. But in many of the threads I've read recently, it is a fact (just as it was with me a few years ago) that many folks have the wrong perspective on med school debt (see my OP).

    Still not seein' the light yet, huh? Not necessary to include all those expenses (less med-mal) because it would upset the even playing field that exists in that all Americans have to provide for those things. There's a huge difference between those who make $25k/yr and having to provide for those things and an FP making 120k/yr (conservative figure) their first year out of residency and having to provide for those things.

    What! Supplemental med-mal?!?! I think you are going into gensurg right? If your hospital doesn't provide adequate med-mal under their policy umbrella, you better run :eek: That hospital is about to close.

    I never talk about things that I have no knowledge about....if I don't know I don't speak on the subject (and there is a lot that I don't know)...but I'm confortable in my own skin.

    :) There is no small print in physician employment ads, and all the print in the employment contracts is the same size. ;) :laugh:


    There you go again with presumption :rolleyes: How is it that you feel I cannot be at least as knowledgable (yet my comprehension and breadth does exceed yours) since we both have obtained the information through the same means: our 4-yr med school experience and reading. Are you dismissing me as incapable of having knowledge in this area?

    Now, it's become very clear to me that you don't care about seeking accuracy and that you are very well aware that you are deceiving people.:thumbdown:
     
  26. scpod

    scpod Physician Moderator Emeritus 10+ Year Member

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    You know, maybe it's just me, but I'm kinda having a hard time with understanding the purpose of this whole thread anyway. I really don't know anyone who has used money as the "sole criterion" in choosing a medical school. Oh, I know plenty of people who decided to stay in-state because it was cheaper, but I have a proble believing that was the "only" reason. It might be the final deciding factor when all the other criteria have been carefully considered.

    I'll admit that cost was a big factor for me, but it was far from the sole criterion. I got to move to a place where the average temperature is like 74 degrees for the entire year, and for only about five grand more than my in-state MD schools. But there were a lot of other factors too.

    I just can't see anyone making cost their "sole criteria", hence, my puzzlement.
     
  27. Kuba

    Kuba Physician 10+ Year Member

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    shouldn't you guys take this to the big boy forum?
     
  28. Dr JPH

    Dr JPH Banned Banned 10+ Year Member

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    And what is my motivation? To push people to be more financially responsible? Shame on me.

    :rolleyes:

    Its not worth trying to have a conversation with you Tweety.
     
  29. Dr JPH

    Dr JPH Banned Banned 10+ Year Member

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    Wow. Kuba...I would listen to that advice on one condition.

    You stop posting as if you know anything about being a medical student.

    Ok buddy? Ok. :thumbup:
     
  30. scpod

    scpod Physician Moderator Emeritus 10+ Year Member

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    :laugh: Better watch out, JP. The other day Kuba told everyone that orthodoc doesn't have a penis. There might be a nasty rumor headed your way too!
     
  31. TweetyPie

    TweetyPie ` 10+ Year Member

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    Huh? :confused: AAFP is just one of many sources of physician recruitment. The 27 was just an example of one source that provided proof that JPHazelton made a misleading statement when he said, "These programs are not as common as you may think." Obviously, there numerous positions offering this incentive out there. For anyone and everyone who wants this incentive, who places it as a high priority will get it.

    Are all ~3500 FP grads D.O. grads subject to D.O. school tuition? Wouldn't you say that the majority of those are M.D. grads? And out of those M.D.'s how many of those either went in-state or took advantage of strong endowment programs? So, what were talking about here is a figure that includes grads from most of the D.O. schools and a lesser number from M.D. schools. Most M.D. grads will not seek out loan repayment incentives. It is more relevant to D.O.'s.

    If one wants this incentive there are plenty of private practices/hospitals who offer it, so one does not have to practice in a rural area under a fed/state program.

    Well it's just one option to get loan repayment incentive. Obviously it's not for everyone. JFYI, if you go ~35 mi. south of Dallas, there you will find a federal underserserved area. Many areas surrounding major metropolitan areas are designated this way. Not all places are "rural".

    I assume you are talking about the federal/state programs. This is completely different than the private practice/hospital employed incentive.

    It is true, the agreement you sign with the government is much more restrictive....but hey, are you surprised, it's the government. But don't lump that in with the private practice/hospital employed incentive. I imagine the fed programs will appeal to more people who are already from an underserved area who want to return.
     
  32. TweetyPie

    TweetyPie ` 10+ Year Member

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    I said "Soley".
     
  33. TweetyPie

    TweetyPie ` 10+ Year Member

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    I'm not a sarcastic person, nor am I in the habit of making sarcastic phrases using sarcastic emoticons. I was simply replying to you with your unfounded arrogance and sarcasm in kind.

    Perhaps, the quotes below will jar your memory:

    AND

     
  34. TweetyPie

    TweetyPie ` 10+ Year Member

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    Ya' know, scpod, you puzzle me? Why the contention? No basis for it. You and Hazelton have a history together? So much so that you that you want to risk being misinformed?

    As I vaguely alluded to in my OP, this thread was started in response to the thread entitled, "UNECOM: The most expensive COM in the known universe", which I didn't want to post in as it may have been overlooked and watered down. So, in the context of that thread there is indeed indication that someone would, for example, with all other factors being equal use the remaining sole factor of tuition as a deciding factor for not attending a particular school.

    But since my OP speaks to choosing specialties as well. Folks indeed have used their misplaced fear in their ability to manage their loan obligations as a sole factor in choosing a speciality.
     
  35. TweetyPie

    TweetyPie ` 10+ Year Member

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    Let me serve you all notice now, that my intention with creating this thread was to help pre-meds/med students. You can take the info or leave it.

    But unless you can refute with citations of what I have said, I'm not going to reply to statements of bias that you may have toward the subject.
     
  36. scottyd214

    scottyd214 2+ Year Member

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    i was clearly joking. just thought it was a funny site and would share
     
  37. Dr.Inviz

    Dr.Inviz Banned Banned

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    Is your information validated through citations/concrete information? I don't see anything other than more assumptions thrown into an already extraneous thread.
     
  38. TweetyPie

    TweetyPie ` 10+ Year Member

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    What specifically do you need substantiated?
     
  39. Dr JPH

    Dr JPH Banned Banned 10+ Year Member

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    I think what Dr. I is saying is that you are blowing smoke up the collective SDN ass.

    :bullcrap:
     
  40. MJB

    MJB Senior Member Physician Moderator Emeritus 10+ Year Member

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    Not necessarily true.

    I've also noticed that these programs are pretty common, but I'm not familiar with what occurs in large metro areas like Philly, Chicago, etc...nor would I be interested in living in either of those places so I don't have much motivation to find out.
     
  41. Dr JPH

    Dr JPH Banned Banned 10+ Year Member

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    What you need to understand is that if someone (anyone) is going to take you on as an employee and pay off your loans PLUS pay you a substantial salary, then they are going to get their money back from you in some way. Whether it be you becoming the call taker, overloading you with patients or restricting things like benefits, contract negotiaion and otherwise.

    All of these programs sound great up front, but have you ever looked at a contract?

    Tweety tells me that "all the letters are the same size on a contract" which tells me two things. #1 She is a smart ass and not interested in the truth and #2 she has never seen a contract like this before.

    There are indeed clauses in these contracts which will significantly alter the way you practice medicine. NO ONE is going to assume your debt because they like you. No matter how desperate they are to fill a spot or recruit a doc, they arent going to take on your loans unless they know they have you wrapped up. Thats just how it works.

    But back to the original topic on this thread, $300,000 student loan debt is a lot for ANY physician. I was working with a plastic surgeon this weekend who told me how much his $120,000 loan debt wasnt easy to deal with.

    Now you double that and turn the doc into a fmaily doc.

    My loan debt is substantial, and it comes up for repayment in 3 years. I will still be in residency at that time and my monthly payment will be half of my monthly salary as a resident.

    I know what you can do with your money when you make $120,000/year. I see that paycheck every 2 weeks (not mine, but it belongs to my better half). It doesnt go as far as you might think.

    I think Tweety has good intentions and she is definately correct in saying that you shouldnt let money dictate your specialty choice, but to make it sound like its not important or something that you shouldnt worry about is irresponsible.

    I have no motivation for telling people these things. Whats the benefit to me? I simply want to state the truth and let younger students know that the student loan money we accrue is no joke.

    I have yet to meet a physician in any field who doesnt feel the same. Most of them have come to terms with the fact that they will have a significant monthly loan payment and leave it at that.

    Tweety...dont give the younger generation false hope that someone out there will assume their debt. If you have truly researched this I dont see how you can, in good conscience, say that to be true.

    Trust me when I say it is not as easy as Tweety makes it sound.

    Now I will sit back and wait for her to come back with belittling and sarcastic remarks.
     
  42. MJB

    MJB Senior Member Physician Moderator Emeritus 10+ Year Member

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    I agree that it's no joke. Having "been there" in the real world paying bills and mortgages, etc...for a while, I definitely get that.

    It's something that needs to be approached with caution, but it's pretty sad that some people rule things out entirely just because of the student loan debt...or even consider it.

    I can't specify enough to people that haven't had a "real job"...you better find something you like...or you will be miserable...it doesn't matter how much you make.

    As for the loan repayment deals...I have to admit that I've never seen the contract details, but I can say that the folks I've spoken with about them that have taken advantage of them seem very happy and don't say, or even act like they are being asked to do anything other than do their jobs.

    One doc I know came here and they paid his loans, and he's been voted the best physician in the hospital for a couple years running, so I'd say the hospital got a pretty good deal. He sees 30+ patients a day...so he's billing plenty I would guess.

    I guess there really is no hard and fast rule on this, and it's up to each person to research their options.
    Just like I wouldn't recommend applying anywhere that you wouldn't move to in a heartbeat, I wouldn't enter into an agreement without knowing where you'll live, but that's just me. To me, that's why the Military and HPSP are not good options.
     
  43. Orthodoc40

    Orthodoc40 7+ Year Member

    That's because he knows I am female.
    It isn't a nasty rumor. And no, I haven't had any interesting surgeries!
     
  44. Kuba

    Kuba Physician 10+ Year Member

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    orthodoc doesn't have a penis. Unless she had some interesting surgery:rolleyes:
     
  45. FizbanZymogen

    FizbanZymogen Guitar Hero Champion 5+ Year Member

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    D.C.
    I love how everyone assumes FP salaries will always continue to increase. You better rethink that assumption as I really believe we are headed for some serious changes in PC over the next 10-20 years. If you want to be NEEDED in medicine, specialize and then sub-specialize. Make yourself a rarity!
     
  46. Dr.Inviz

    Dr.Inviz Banned Banned

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    Universal healthcare anyone? :idea:
     
  47. Kuba

    Kuba Physician 10+ Year Member

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    wow, you were really threatened by my innocent little comment, huh? poor guy, its ok.
     
  48. :eek: Holy crap......thank you JP. *bows down*
     
  49. MJB

    MJB Senior Member Physician Moderator Emeritus 10+ Year Member

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    If that happens, I fear we're all screwed.
     
  50. FizbanZymogen

    FizbanZymogen Guitar Hero Champion 5+ Year Member

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    D.C.
    Universal health care does not mean there won't be private medical groups who choose to cater to cash customers (I chose this word carefully). It will however destroy Americas great medical system (while its far from perfect it the best in the world period).
     
  51. Dr.Inviz

    Dr.Inviz Banned Banned

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    Thanks for the "much needed" definition, followed by more :bullcrap: :smuggrin:
     

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