Andrew Herstein

May 6, 2008

Obtaining a medical education is more expensive than ever. In 2006, median tuition and fees amounted to $20,978 at public medical schools and $39,413 at private ones. As in previous years, the vast majority of students have relied upon a combination of Federal Direct Subsidized and unsubsidized loans to finance their degrees. And as tuition continues to increase, students are graduating with an ever larger amount of debt. Public medical school students graduating in 2006 reported owing a median of $120,000, while their private school counterparts owed a median of $160,000. Most graduates choose to defer repayment until the completion of residency training, but interest continues to accrue on the unsubsidized portion of the principle during this period. Consequently, public and private school graduates face median debt of $151,342 and $205,707, respectively, as they begin their careers.

Are Increased Med School Costs Even A Problem?

Some argue that the high cost of obtaining a medical education is not a problem. After all, the mean annual salary in 2006 for an internist was almost $161,000 and over $184,000 for a surgeon. Despite the high up-front costs, medical education continues to be a favorable investment from a financial point of view. For example, the average physician can expect greater financial rewards over the span of a career than the average lawyer can, even after accounting for higher education costs and lower earning potential during residency.

However, the high price of a medical education and the debt incurred has very important implications for the racial and ethnic composition of the physician workforce. According to 2004 Census estimates, African-Americans, Hispanics, Latinos, and Native Americans constitute nearly 30 percent of the U.S. population. In comparison, only 14 percent of 2004 applicants to U.S. allopathic medical schools (those schools granting an M.D. versus a D.O.) were from these groups. According to the Association of American Medical Colleges (AAMC), the primary reason for this discrepancy is that minority students are much more likely to see financing a medical education as an insurmountable problem. In 2004, the AAMC commissioned a survey of academically qualified college graduates who chose not to apply to medical school. Among minority students, cost of attendance was the most frequently cited reason for not applying, followed by the long duration of medical training and the demands of the physician lifestyle. In contrast, cost of attendance was only the fourth-most cited reason among white students. This is one of the reasons minorities are underrepresented in the physician workforce.

Why Diversity in the Medical Field Matters

One of the most important elements of comprehensive medical care is the relationship between a patient and his or her doctor, and research consistently shows that this is an area where race and ethnicity have a significant, undeniable impact. Patients report higher measures of satisfaction and trust when their doctor is of the same race and ethnicity. One study found that race-concordant visits were longer on average and were characterized by more positive physician affect. In addition, minority physicians are more likely than white physicians to practice in geographic areas whose populations face multiple challenges to maintaining good health. The challenges that residents of these “underserved” areas typically face include poverty, lack of insurance, and shortages of physicians. Research has shown that access to health services for indigent populations is augmented by the presence of minority physicians. And minority doctors report caring for more impoverished, uninsured and Medicaid-insured patients. For these reasons and others, it is clear that developing a diverse physician workforce would pay dividends across the health system, particularly given how many low-income and uninsured Americans lack needed care.

Two Possible Solutions

In order for the United States to continue deriving the benefits of a diverse physician workforce, the cost barriers to medical school entry must be reduced. One way to accomplish this would be for the federal government to help make medical education an affordable option for more qualified college graduates. A good place to start would be to increase the size and funding of the National Health Service Corps Scholarship Program. This program provides tuition and a monthly stipend to medical students in exchange for a commitment to train in a primary care specialty and then practice for a minimum of two years in a federally designated Health Professional Shortage Area. With more scholarships available, medical school would become an attractive option for an increased number of minority students, presumably resulting in a more diverse workforce. As demonstrated in the research cited above, these students would be likely to continue practicing in underserved areas beyond their commitments. Currently there are nearly seven applicants for each scholarship available, indicating that there is more than enough interest in the program to justify its expansion.

The federal government could also devote more funding to the Scholarships for Disadvantaged Students program. Authorized under Title VII of the Public Health Service Act, this program provides grants to health professions schools, which then award scholarships to financially needy students. Data collected by the Department of Health and Human Services indicates that this program has been effective in recruiting minority students, which account for more than half of scholarship recipients each year.

Why Things Could Get Worse

Thanks in large part to the tightening of state budgets and resultant cuts in state education subsidies, median annual tuition levels have increased by an average of 11 percent for public medical school students and an average of 5 percent for private school students for each of the past six years. And both public and private schools are subject to other inflationary pressures, such as increased clinical teaching in outpatient settings, which could further drive up costs. If such rapid tuition growth continues, larger and larger numbers of minority students will consider a medical education to be unaffordable. The result would be a workforce that is even less diverse than it is now. Considering the many benefits that a diverse workforce provides, this outcome should be avoided. The federal government has the ability to shape the composition of the physician workforce and ought to do so.

Andrew Herstein is a Health Policy Intern at the Center for American Progress. He will start medical school at the University of Washington in the fall of 2008.