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Cost vs. caring

Yale Medicine Magazine, 1998 - Winter/Spring


A medical student's financial dilemma

Before last spring's Medical Student Council elections, the candidates were asked to name the issue of highest concern to the student body. The answer that resonated with every student was financial aid. When the new dean, David A. Kessler, M.D., asked the same question at the start of this academic year, the answer again was financial aid. When members of the Student Council presented their report to the Association of Yale Alumni in Medicine in late September, once again they pointed to the urgent need for Yale to seriously look at a medical student's financial burden. Medical students at Yale face an increasing and ominous threat of excessive indebtedness that may very well affect their choice of a professional field of medicine. Lack of financial aid funds also puts Yale at a competitive disadvantage among its peer institutions.

The cost of medical education has continually risen. Ten years ago, the cost of attending Yale was $21,239 per year for tuition, room, board and related expenses. Today that figure has nearly doubled, to $40,515. Tuition alone for the current academic year rose by $2,000 to $26,700, an increase of 8 percent.

Students meet these costs using personal savings, family contributions, scholarship grants established by alumni/ae, and loans. A majority have little savings, if any, especially after the first year of medical school. Most have left their parents' home and do not receive the family contribution that the school factors into its calculations. Grant money is limited. Furthermore, medical students are discouraged from working because of the intensity of the program, though some do work to meet expenses. More than half the cost of a Yale medical education, therefore, is borrowed. When members of the Class of 1997 walked off Harkness Courtyard after Commencement last May, they carried an average debt of $76,644. The largest debt owed by a member of the class was $159,855. Over the course of a 10-year repayment schedule with interest, a student ultimately pays more than half a million dollars.

What appears to make this level of debt justifiable is a false assumption made by policy-makers within the federal government. They assume that all medical students will earn an extraordinarily large income directly out of school. The U.S. Department of Health and Human Services has eliminated all educational loans based on need. Only those students who give up the freedom to choose their field by signing on to a primary care practice receive loans with deferment support. The federal Stafford loan program has stopped its loan deferment during the residency years with the result that many residents are hard pressed to keep up with their payments.

The most disturbing concern stems from the rapidly changing face of managed care medicine. On average, a resident or a fellow earns $35,000 annually. Yale medical graduates generally train for four to seven years past their medical school education. Once this training is complete, the young physicians are expected to cope with a managed care environment that has already squeezed out every possible penny from income. With an estimated physician surplus of more than 30 percent under managed care, even the once-safe assumption of guaranteed employment is no longer valid. What promises to remain is a huge indebtedness on the part of the students, which still has to be paid.

The greatest threat to a young physician's career–being forced to consider cost in choosing a field of medicine–stems from such a difficult financial scenario. Yale School of Medicine has always been fortunate to attract highly qualified students who are dedicated to the profession of healing. Yale students are expected, and for the most part do, choose their fields based on their interest and motivation. One has to wonder, however, whether it is possible to make a residency decision without considering financial compensation. More importantly, is it really possible to practice medicine in one of the noblest fashions, such as practicing in an underserved area, after incurring formidable education debts?

The proof that the financial burden is a real concern comes from the fact that many medical schools have already taken steps to alleviate the problem by actively bolstering their financial aid program. Most schools not only draw on their endowment, as Yale does, but actively fund financial aid through their operating budgets, something Yale does not do. The University of Pennsylvania is working to make much of its program tuition free by the year 2005. Considering the fact that tuition accounts for less than 5 percent of the typical medical school's budget (4 percent at Yale), this revolutionary goal is not impossible. Free tuition may not be necessary. What is required, however, is a serious effort outlining specific cost-reduction objectives. The funds currently available for financial aid all come from the endowment established in part by our generous alumni/ae. Those who choose to give to Yale School of Medicine may consider financial aid as a prime option. Until our endowment rises, we are faced with the fact that spending everything we can from the current endowment for financial aid is inadequate in keeping Yale competitive. Those of us who love Yale School of Medicine came to Yale for the enthusiasm and energy of student life at school. This energy has to be constantly nourished, for without it, the spirit of Yale Medicine cannot survive. To keep this energy alive, something has to be done to help the financial costs incurred by the students. Tuition increases have to be halted and financial aid has to be increased.