Physicians play an invaluable role in our health system, a role that has taken on new urgency as the COVID-19 pandemic continues to sweep across the nation, and the world. We admire physicians for their dedication and their tireless service to the community.
So why is it that, despite average wages of more than $243,000, only 77% of American doctors say they would choose the field if they had to do it all over again, according to a recent Medscape Report? More and more doctors are finding themselves saddled with nearly insurmountable student loan debt, on top of all of the many daily stresses facing modern practitioners. And with the lengthy duration of commitment required to complete medical school and a post-doctoral residency, many physicians spend years paying off that debt.
Consider Dr. Molly Dorfman, a 39-year-old pediatric care specialist working at Valley Children’s Hospital in Madera, California. Dorfman, interviewed by the New York Times, says she was paying more than $4,500 a month on a single student loan, an amount that represented almost one-third of her earnings.
In his paper Five Ways to Move the Needle on the Physician Shortage, Tony Stajduhar, President of Jackson Physician Search, discusses how a looming national crisis faces America as a wave of Baby Boomer doctors leave the healthcare industry. Research by the Association of American Medical Colleges suggests a current shortage of between 54,100 and 139,000 physicians nationally by 2033. The AAMC also notes new doctors, on average, carry approximately $200,000 in student loan debt.
Making medical school a more affordable and streamlined process, and working to more easily eradicate that crushing student loan debt, both represent much-needed solutions to help encourage more young and talented students to pursue medicine.
Getting Assistance to Curb Student Loan Debt
Under the federal CARES Act, many frontline doctors were granted a freeze on their student loan payments, through the end of September 2020. The program is, in a way, an extension of the nearly 80 different state and national-level programs available to offer loan forgiveness or payment assistance to doctors.
While completing their residency, new physicians have the opportunity to provide two- or three-year commitments with organizations including the Indian Health Service or the National Health Service Corps, serving low-income communities, in exchange for considerable debt reduction. Similarly, service in three branches of the American armed services can largely take care of student debt, in exchange for work as a military physician.
Individual states have also enacted their own debt-relief programs. Dr. Dorfman is one of more than 250 California physicians taking part in the CalHealthCares initiative, which provides a $300,000 reduction in student loan debt, in exchange for accepting Medicaid patients. California’s forgiveness plan is part of a larger, $3 billion effort there to address the physician shortage.
Forgiveness Isn’t Necessarily an Easy Thing
But while many sing the praises of programs such as the federal Public Service Loan Forgiveness plan, which promises to entirely forgive the balances on student loans after 10 years of work with a government or non-profit organization – plus steady loan payments – the reality is often more difficult, and elusive.
According to National Public Radio, the PSLF program has a 99% denial rate, and is almost impossible to access as other federal student loan forgiveness opportunities have also become more stringent.
Many hospitals and health care employers have opted to provide student loan debt reduction programs as part of their bonus and compensation packages to attract new doctors. More than 75% of hospitals offer bonuses to their physicians, usually in the form of performance incentives, but more and more are recognizing that debt relief is often a more pressing concern to potential hires.
For those healthcare facilities that are hiring younger doctors, a generous student loan payoff also gains them a competitive advantage in the recruiting market. These employers recognize that a smart approach to increasing the chance that job offers will be accepted by physicians is to customize their compensation packages to the specific needs of the demographic they’re recruiting.
-> A consultative recruitment partner like Jackson Physician Search has the breadth and depth of experience to assist in formulating attractive compensation offers.
Curbing the Costs, Before They Occur
What if those education costs could be addressed at the front end, with lower tuition rates or even a more compressed period of time required to actually complete medical school?
The time commitment to become a physician is certainly overwhelming, even by other professional standards: four years of college, four years in American medical school and between three and seven years in residency/fellowship. And costs of medical school are extraordinary, according to the AAMC: nearly $244,000 for public schools, and nearly $323,000 for private medical schools.
A new solution, one championed by more than 16 schools participating in the Consortium of Accelerated Medical Pathway Programs, is to condense medical school to three years. Major schools such as Penn State, Duke and Texas Tech have already offered the shorter programs – which mirror the quicker route available at foreign medical schools.
The benefits, advocates say, are enormous: students learn the same vital practice skills, but with less financial stress involved, with graduates expected to save more than a quarter million dollars over their professional lives.
Some private schools have addressed the tuition cost issue directly. Recognizing the long-term impact of high pre-career debt, the University of Illinois College of Medicine announced plans earlier this year to cut its out-of-state tuition prices by 16%. That is estimated to save students as much as $60,000 in educational costs.
Free Tuition as an Attractive Option
And after a decade of fundraising and financial planning, NYU’s medical school arranged to make tuition free to its students – normally $55,000-plus per year. Likewise, the Kaiser Permanente School of Medicine also began offering free tuition in 2019, thanks to considerable underwriting. Could other schools, however, be able to bare the $600 million cost of NYU’s honorable undertaking?
Tackling education costs and the burden of student loan debt won’t happen overnight, but these many initiatives show there is room for creativity and concern in helping encourage more young people to practice medicine, thereby reducing the looming physician shortage.
If your organization can benefit from partnering with a physician recruitment firm that leads the industry with an all-digital recruitment strategy and can guide you in designing benefit packages that are effective in recruiting doctors across the spectrum of their careers, contact the Jackson Physician Search team. Our recruitment professionals can help keep you ahead of the recruitment curve and combat the physician shortage.