Medical Student Debt

Student debt statistics

• $154,607 – According to the Association of American Medical Colleges (AAMC), the average educational debt of indebted graduates of the class of 2008. The average debt of graduating medical students increased in 2008 by 11 percent over the previous year.
• 79 percent of graduates have debt of at least $100,000.
• 87 percent of graduating medical students carry outstanding loans

Source: AAMC 2008 Graduation Questionnaire

Why medical education debt has increased

Medical education debt is driven by rising tuition. AAMC data show that median private medical school tuition and fees has increased by 50 percent (in real dollars) in the 20 years between 1984 and 2004. Median public medical school tuition and fees increased by 133 percent over the same time period. Other recent 20-year periods show similar trends. Figures 1 and 2 (PDF, 23KB) demonstrate an upward sloping curve juxtaposing the rising debt and tuition—both faster than inflation.

Tuition is just one source of increasing debt burdens. Some other causes include:

• Interest accrued on loans over time significantly adds to the total cost of student debt
• Students now entering medical school with more education debt from undergraduate education
• Increasing numbers of “non-traditional” students who have children to support

Debt crisis harms both students and patients

The increase in debt not only burdens medical students, but can have effects on the entire health care system. Some of correlations found include:

Decrease in primary care physicians

• Students with high debt are less likely to pursue family practice and primary care specialties and instead seek specialties with higher income or more leisure time

Decreased diversity of physician workforce

• The cost of tuition can prevent students from low-income/minority and those with other financial responsibilities from attending medical school
• Physician diversity is necessary to address the needs of heterogeneous, multicultural patient populations

Promoting unsafe physician behaviors

• Residents with high debt are more likely to moonlight
  • Increases fatigue and may contribute to medical errors (see Figure 4 (PDF, 39KB)
• Increasing debt leads to more cynicism and depression among residents (see Figure 5 (PDF, 41KB)

How can we reduce debt?

The MSS has come up with recommendations for legislative and administrative remedies to resolve the medical education debt crisis. These recommendations focus on controlling tuition, the principal component of education costs, but include a number of relatively simple administrative measures that could be taken immediately and at a low cost to individual medical schools.

Federal level

• Reauthorization of the Higher Education Act
• Securing adequate funding for Title VII health professions programs in the FY 2009 Labor, Health and Human Services, Education and Related Agencies appropriations bill and expanding and protecting the National Health Service Corps (NHSC) Loan Repayment Program
  • Read the AMA letter (PDF, 60KB) to the Chairman of the Senate Committee on Appropriations
• Broadening the tax-exempt status of medical scholarships

State legislative options

• Tuition caps
• State tax deductions for loan interest
• State service loan repayment programs

Reform individual medical school financial policies

• Tuition caps
• $50,000 private institutions
• $30,000 public institutions
• Change fee policy

Innovative strategies for reducing student loan needs

• Increasing grants and scholarships
• Collaborate graduate/undergraduate debt counseling
• Collective buying to reduce student expenses

Links of interest

Task Force on Medical Student Debt, Final Draft (PDF, 267KB)

AAMC state loan repayment program
(This link will take you off the AMA Web site. The AMA is not responsible for the content of other Web sites.)

Background
Background information and activities of the AMA-Medical Student Section related to medical student debt.

Policies
AMA-MSS Policies on Medical Student Debt.

Resources
These documents and Web sites are provided to aid you in your quest for information on various topics such as medical student debt facts and statistics, financial aid options, debt management, and loan consolidation.

Higher Education Act
The Higher Education Act (HEA) of 1965 initiated the federal student loan program and currently establishes the federal guidelines, such as student loan interest rate adjustments, deferments, subsidies, and tax deductions. The AMA is working hard on your behalf to make necessary revisions that could save medical students millions of dollars.