Wednesday, August 06, 2014

Medscape: 36% of Residents Have Over $200,000 Debt

From Medscape:

The same article quotes the average resident salary as $55,300.  The actual "take-home"pay for residents is actually much lower and must be calculated for the state in which the doctor practices.  For this, I turned to's salary calculator.

Taking the $55,300 salary for a single doctor in Illinois, the weekly pay is $1063.46.  From this comes the Federal withholding ($175.36), Social Security withholding ($65.93), Medicare withholding ($15.42), and Illinois witholding ($53.17), leaving $753.58 per week in income ($18.84 / hour for a 40-hour work week).

Now, if we just look at a monthly payment at 4.5% interest on a (conservative) $200,000 thirty-year loan, the monthy payment comes to $836.03.  It becomes apparent that medical residents will have to work more than 8 days a month to just paying off their medical school loans.

More cheap money offered to residents in the form of new loans won't help this problem, it will only make things worse.

With the average public medical school tuition exceeding $207,000 and the average private medical school tuition exceeding $270,000, the joy of doctoring will quickly lose its luster for tomorrow's doctors-in-training. 

And this crisis promises to only get larger for tomorrow's physicians.

For those planning on medical school, you might want to consider other sources of funding for your education.  While the Navy had its drawbacks, at least I left medical school with $0 debt.



Anonymous said...

An analysis like this is less precise than it could be. Luckily, there are plenty of smart people looking at the same problem (is medical training worth the cost).

Answers vary, but there is no excuse for someone starting medical school to not understand the financial side of what they're getting into.

Answer yes:

Answer maybe not (work 'til 75!, but only $150k):

If you're just after $, plug your nose and head towards Wall Street. Don't expect an easy time, however.

The final vote on the issue comes each year when med school applications roll in. As long as there are way more applicants than slots, someone thinks the burden is worth the payoff.

Anonymous said...

Indentured servitude.

As hospitals merge, they will have bargaining power over physician contracts. Expect the largest cost to hospitals, i.e. labor, to drop as margins shrink. At some point, physician salaries will not be sufficient to repay the inordinate sums required to fulfill the ever increasing and rapidly expanding requirements of medical training (see MOC).

Not to mention, the Obama tax increase which mainly falls on the working professionals and NOT the millionaires and billionaires who rally behind his warped soak the rich mentality. How do you pay off your school debt when a vast majority is being collected by Obama's IRS?

In the distant future, there will be some accommodation made for medical school debt once enough 'victims' realize the impossibility of escaping the hole dug by school loans. The current crop of students will suffer the most, sadly.

Anonymous said...

OMG. They have to pay taxes? What gives with that? The Inhumanity. Obviously, no doctor ought to be asked to make such sacrifices. Why not a nice career in teaching grade school instead? You'll graduate without that crushing debt, have summers off, and a cushy pension ($50K today)when you're 60.

Anonymous said...

It is even worse for many professions. specifically architects and social workers come to mind. while their overall debt is smaller upon graduation- so is their earning power.

also- no one has a vast majority of their income collected by the IRS. The IRS is not obama's, it is the us governments.

Anonymous said...

Over 40% have less than $200K. 25% have no debt. I'd say that right there, with the ability to pay that back in 10 years, and the increases in pay for experience, it is still a very lucrative position. Look at the rate of unemployment. A doctor, even in primary care, has a greater chance of getting into the millionaires group, than they do as a banker, CEO, etc.

Anonymous said...

and look the hospital's CEO's salaries (with maximum a master degree) with 1 to 1.5 million per year.

Anonymous said...

This will contribute to the growing trend of students choosing to be PAs or NPs.

It takes less time and money to be trained. They usually do not have to take call. They do not have uncompensated overtime. They do not shoulder the same liability as physicians. Also, they do not have to live under the yoke of MOC.

As far as the insurance companies and government is concerned, a provider is a provider, so the reimbursement is the same.

In our area, some midlevels working for specialists get paid more than primary care physicians. The kicker is that one of these midlevel "specialists" can change their specialty at will, usually with a few weeks of OJT with the supervising physician. No residency, board certification, or MOC.

I may go back to school to get a masters so I can be a PA....

Anonymous said...

Anon 05:33 8/7/09-
Increased pay for experience?
From an insurance company?
Surely you jest?!?