6 ms·

Medical School at $278,000 Means Even Bernanke Son Has Debt

23 points by simonreed 13y ago

frozenport 13y ago
Maybe, but they also have a stable guarantee of income. They certainly don't live in poverty and fear.
- ameister14 13y ago
  What about the people that drop out of school or residency? Not everyone is going to make it through.
  - haldujai 13y ago
    Very very few people drop out or fail out of medical schools. Whether the huge debt load is the reason is another issue.
- mbreese 13y ago
  You'd be surprised how many doctors struggle to get by while paying their debts off. Starting doctors don't get paid very much (considering their debt load). It's even worse when you factor in their opportunity losses by spending 4 years more in school and 3-5 years more in residency (where you don't get paid much). And if you add in a specialized fellowship? That's 3-4 more years. It's 7-13 years before you actually get to start making real money. And if you're a GP, you're still only making a fraction of what you could be making elsewhere.
  - tsotha 13y ago
    This. Becoming a GP in the US by any route other than the military is going to put you way behind just about any of your undergrad classmates with a marketable degree if you consider lost opportunity. There's also something else to consider. 7-13 years is a long time, and lots of things in your life will change. You may not be able to or want to practice medicine (I know one of each), but that debt isn't going anywhere.
  - rdouble 13y ago
    A couple advantages to medicine are that you can keep working consistently until retirement age, and you can essentially work anywhere in the country for a the same salary. A GP may "only" make $150K in Westchester but they can also make $150K in rural Maine.
  - haldujai 13y ago
    I disagree, many physician jobs offer loan repayment (of up to $200k) while offering salaries in the upper 300-400s (for many specialties). Surgeons can easily make seven figures depending on what they are doing. You also have to factor in the job security, the fact that transitions to other roles does not entail a pay cut (as in law or finance) and the potential to be your own boss (run your own practice). Doctors who make little money (the reason the average is so low) is because they choose to work less hours and spend time with family and friends. It's not as bleak as you think.
    - nilkn 13y ago
      > Surgeons can easily make seven figures depending on what they are doing. That seems like quite an exaggeration to me. Surgeons are highly paid, but in the grand scheme of things very few of them make $1m+/year. And the ones who do so generally do not do so easily. Neurosurgeons and orthopedic surgeons are generally the highest paid of all doctors, but both rarely crack seven figures, and they work horrendous hours in many cases. And becoming a neurosurgeon is simply beyond the ability of most medical students anyway. Perhaps if you set up a plastic surgery shop in Beverly Hills and hired other doctors under you.
  - frozenport 13y ago
    I knew two people in their residency, their problems were a lack of sleep not lack of money. They lived off loans, but they had enough money to eat out everyday. I am not sure about the weight of their loans. The only thing thing I recall it stopping them from doing was buying a fancier house. This isn't poverty!
    - mbreese 13y ago
      They didn't eat out because they could afford it. They ate out because they didn't have time to cook or because that's the only real meal they have time to eat.
forgottenpaswrd 13y ago
But Bernanke can print money for him and for his friends. You can't.
davidf18 13y ago
As a physician (with a BS EE/CS degree which is why I frequent HN), I tire of this argument. If one reads the article carefully, they find that the father Dr. Mark Moy attended excellent public medical school (and lower cost) Univ. of Illinois in Chicago while his son is attending the very expensive (and lower quality) Chicago Medical School (not to be confused with Univ of Chicago School of Medicine). Many graduating doctors get into big debt because they choose to attend private undergraduate and private medical school. Instead of getting into such huge debt, a fiscally responsible medical student should attend a lower cost, quality public undergraduate school and a public medical school. For example, in New York State, one could attend one of the SUNY schools or the public part of Cornell (the Agriculture school for instance) undergrad and then SUNY Downstate Medical School where they would get outstanding clinical experience for the approx cost of private undergraduate tuition alone. It seems odd that Berknanke's son would still be in debt if he had attended both public undergraduate and medical schools and does seem so fiscally prudent on the part of the Fed Chairman and his son. In addition, IIRC, you can have the military pay for full medical school if you serve for four years as a doctor after you graduate if you are not good enough to get into public medical school. In summary, for most people who complain of medical school debt in this country, it is really a sign of not being fiscally prudent on their part or of those of their parents.
- quantumhobbit 13y ago
  Sure you can save plenty of money going to a public school. But even though $100,000 is less than $350,000, it is still a huge amount of money. Even more once you consider that doctor's have to undergo a residency after med school in which they barely earn minimum wage.
  - stephencanon 13y ago
    > doctor's have to undergo a residency after med school in which they barely earn minimum wage. Residents earn between $45k and $60k a year. While they do work long hours (my wife is a neurosurgical resident, so I am quite familiar with the hours), and are grossly underpaid compared to their skills, comparing a resident's salary to "minimum wage" is absurd.
dr_ 13y ago
And to add to this we are heading into an era of what appears to be declining reimbursements. If not declining, then there certainly have not been increases commensurate with increases in the cost of training. Students are always told there will be a shortage of primary care physicians. I was told the same in the mid 90's as a student. Just because there's a shortage, however, it does not mean that "increased" demand has resulted in increase reimbursements for primary care physicians. Instead, the trend has been the growth of nurse practicioners and physicians assistants assuming greater responsibilities for care, at a much lower cost. So if you are medical student now, my advice would to practice, of course, whatever specialty makes you happy, but don't fall for the shortage of primary care providers schtick - if that's the reason you choose primary care, you will be disappointed.
rayiner 13y ago
Bernanke is a career academic. What would make you think he's particularly wealthy?
- antidaily 13y ago
  My thought too. Even Ben Bernanke. His salary is 180k. Good but not enough to spend 50k a year on med school most likely.
  - Gravityloss 13y ago
    That's something like 1.6 years salary (assuming 6 years of med school)? Seems quite cheap, compared to something like an apartment...
    - rayiner 13y ago
      Med school is 4 years at around $65,000 per year (post tax obviously). $180,000 per year post tax is $105,000. So that's 60% of his after-tax income for four years.
Shenglong 13y ago
I'm caught in an interesting trap where a third of my friends are set to become doctors, a third investment bankers/consultants, and another third will be going into tech. I'm also in Canada. When our medical school friends explain their debt, my IB friends get really excited and start cursing them for their luck. Here, apparently, in addition to student loans that don't accrue interest until 6 months after graduation, all medical students are apparently eligible for a $250,000 line of credit at PRIME. Yes, you heard me--PRIME. At this point, my tech friends start to ask why anyone would take debt. Here in Canada, an emergency doctor would make about $250,000/year in Ontario for working what works out (in shifts) to be about 25 hours per week, after he has finished his residency. Assuming this is a similar situation in the states, I don't see why this is so outrageous at all. Oh, and Doctor shortage? Really? It's medical schools that cap entrants, not the price. Take a look at all the qualified students who are rejected each year. I know a bunch.
- rayiner 13y ago
  In the states, federal graduate student loans are 8%.
  - ryanhuff 13y ago
    Are you sure? When I did my MBA a few years ago, student loans were about 6.5%, and I thought I heard that rates were lower today.
    - rayiner 13y ago
      There are Stafford loans at 6.5% but they only go up to like $20k/year. GradPLUS covers the bulk of the cost and is at 7.9%.
- eterpstra 13y ago
  The reason medical schools cap the number of entrants is the same reason they raise tuition exponentially - it's expensive to run a medical school. It has nothing to do with the number of applicants. Also, 25 hours per week? My wife is a physician. Nobody at her hospital works less than 60. Most work 80 or more. Surgeons are close to 100. For many full time primary care physicians, it works out to about $10 / hour when first starting out.
cjc1083 13y ago
I'd say given the salary data, the fact that medicine is a stable and growing field, and the amount of high level training required , these numbers are not really crazy or out of line. http://www.profilesdatabase.com/resources/2011-2012-physician-salary-survey http://www.profilesdatabase.com/resources/2011-2012-physicia... After six years of practicing, even a non specialized doctor will be at 200K with the lowest starting salaries around 140K. That is a fantastic amount of money when you consider that it is the lower end of the pay scale for doctors and that it will be a completely secure position in which you can work until death or retirement. 250K is a small price to entry into 8Million+ lifetime earnings. Being highly successful in most fields is equated with 150K and beyond salary point, which comes with increased competition and no job security as you move up the ladder...I don't see this as being a bad deal at all, even for those totally self/debt funding.
- nilkn 13y ago
  Indeed, the salaries in medicine can be so absurdly high that $250k of debt is truly not as much as it sounds. If a dermatologist starts at $234k, then you could easily pay back $100k/year and still have a very comfortable chunk of change left over. And that's ignoring salary increases. In a few years, you'll be debt free making $350k. And you could see numbers of that magnitude even in cheaper rural areas where you'll live like a king. And I completely agree with you on job security as well. Once you start practicing, you're pretty much made for life.
mindslight 13y ago
Of course - you've got to be a True Believer to get that kind of leadership position, and he would have of course taught that to his son. These people actually believe that having any non-monthly expense able to be financed is a good thing, as it is then more "affordable", where affordable means not requiring any sort of planning or saving for the future. Of course this really just causes prices to shoot up, with positive feedback if the good can serve as collateral, which exacerbates the problem causing more people to finance. Essentially they are working to erode the utility of money itself, and revert us back to a social reputation based system where your stature in life depends on your creditworthiness and obedience to your job (stability required to make all those continuing monthly payments).

23 points by simonreed 13y ago

frozenport 13y ago

Maybe, but they also have a stable guarantee of income. They certainly don't live in poverty and fear.

ameister14 13y ago
What about the people that drop out of school or residency? Not everyone is going to make it through.
- haldujai 13y ago
  Very very few people drop out or fail out of medical schools. Whether the huge debt load is the reason is another issue.
mbreese 13y ago
You'd be surprised how many doctors struggle to get by while paying their debts off. Starting doctors don't get paid very much (considering their debt load). It's even worse when you factor in their opportunity losses by spending 4 years more in school and 3-5 years more in residency (where you don't get paid much). And if you add in a specialized fellowship? That's 3-4 more years. It's 7-13 years before you actually get to start making real money. And if you're a GP, you're still only making a fraction of what you could be making elsewhere.
- tsotha 13y ago
  This. Becoming a GP in the US by any route other than the military is going to put you way behind just about any of your undergrad classmates with a marketable degree if you consider lost opportunity. There's also something else to consider. 7-13 years is a long time, and lots of things in your life will change. You may not be able to or want to practice medicine (I know one of each), but that debt isn't going anywhere.
- rdouble 13y ago
  A couple advantages to medicine are that you can keep working consistently until retirement age, and you can essentially work anywhere in the country for a the same salary. A GP may "only" make $150K in Westchester but they can also make $150K in rural Maine.
- haldujai 13y ago
  I disagree, many physician jobs offer loan repayment (of up to $200k) while offering salaries in the upper 300-400s (for many specialties). Surgeons can easily make seven figures depending on what they are doing. You also have to factor in the job security, the fact that transitions to other roles does not entail a pay cut (as in law or finance) and the potential to be your own boss (run your own practice). Doctors who make little money (the reason the average is so low) is because they choose to work less hours and spend time with family and friends. It's not as bleak as you think.
  - nilkn 13y ago
    > Surgeons can easily make seven figures depending on what they are doing. That seems like quite an exaggeration to me. Surgeons are highly paid, but in the grand scheme of things very few of them make $1m+/year. And the ones who do so generally do not do so easily. Neurosurgeons and orthopedic surgeons are generally the highest paid of all doctors, but both rarely crack seven figures, and they work horrendous hours in many cases. And becoming a neurosurgeon is simply beyond the ability of most medical students anyway. Perhaps if you set up a plastic surgery shop in Beverly Hills and hired other doctors under you.
- frozenport 13y ago
  I knew two people in their residency, their problems were a lack of sleep not lack of money. They lived off loans, but they had enough money to eat out everyday. I am not sure about the weight of their loans. The only thing thing I recall it stopping them from doing was buying a fancier house. This isn't poverty!
  - mbreese 13y ago
    They didn't eat out because they could afford it. They ate out because they didn't have time to cook or because that's the only real meal they have time to eat.

forgottenpaswrd 13y ago

But Bernanke can print money for him and for his friends. You can't.

davidf18 13y ago

As a physician (with a BS EE/CS degree which is why I frequent HN), I tire of this argument. If one reads the article carefully, they find that the father Dr. Mark Moy attended excellent public medical school (and lower cost) Univ. of Illinois in Chicago while his son is attending the very expensive (and lower quality) Chicago Medical School (not to be confused with Univ of Chicago School of Medicine). Many graduating doctors get into big debt because they choose to attend private undergraduate and private medical school. Instead of getting into such huge debt, a fiscally responsible medical student should attend a lower cost, quality public undergraduate school and a public medical school. For example, in New York State, one could attend one of the SUNY schools or the public part of Cornell (the Agriculture school for instance) undergrad and then SUNY Downstate Medical School where they would get outstanding clinical experience for the approx cost of private undergraduate tuition alone. It seems odd that Berknanke's son would still be in debt if he had attended both public undergraduate and medical schools and does seem so fiscally prudent on the part of the Fed Chairman and his son. In addition, IIRC, you can have the military pay for full medical school if you serve for four years as a doctor after you graduate if you are not good enough to get into public medical school. In summary, for most people who complain of medical school debt in this country, it is really a sign of not being fiscally prudent on their part or of those of their parents.

quantumhobbit 13y ago
Sure you can save plenty of money going to a public school. But even though $100,000 is less than $350,000, it is still a huge amount of money. Even more once you consider that doctor's have to undergo a residency after med school in which they barely earn minimum wage.
- stephencanon 13y ago
  > doctor's have to undergo a residency after med school in which they barely earn minimum wage. Residents earn between $45k and $60k a year. While they do work long hours (my wife is a neurosurgical resident, so I am quite familiar with the hours), and are grossly underpaid compared to their skills, comparing a resident's salary to "minimum wage" is absurd.

dr_ 13y ago

And to add to this we are heading into an era of what appears to be declining reimbursements. If not declining, then there certainly have not been increases commensurate with increases in the cost of training. Students are always told there will be a shortage of primary care physicians. I was told the same in the mid 90's as a student. Just because there's a shortage, however, it does not mean that "increased" demand has resulted in increase reimbursements for primary care physicians. Instead, the trend has been the growth of nurse practicioners and physicians assistants assuming greater responsibilities for care, at a much lower cost. So if you are medical student now, my advice would to practice, of course, whatever specialty makes you happy, but don't fall for the shortage of primary care providers schtick - if that's the reason you choose primary care, you will be disappointed.

rayiner 13y ago

Bernanke is a career academic. What would make you think he's particularly wealthy?

antidaily 13y ago
My thought too. Even Ben Bernanke. His salary is 180k. Good but not enough to spend 50k a year on med school most likely.
- Gravityloss 13y ago
  That's something like 1.6 years salary (assuming 6 years of med school)? Seems quite cheap, compared to something like an apartment...
  - rayiner 13y ago
    Med school is 4 years at around $65,000 per year (post tax obviously). $180,000 per year post tax is $105,000. So that's 60% of his after-tax income for four years.

Shenglong 13y ago

I'm caught in an interesting trap where a third of my friends are set to become doctors, a third investment bankers/consultants, and another third will be going into tech. I'm also in Canada. When our medical school friends explain their debt, my IB friends get really excited and start cursing them for their luck. Here, apparently, in addition to student loans that don't accrue interest until 6 months after graduation, all medical students are apparently eligible for a $250,000 line of credit at PRIME. Yes, you heard me--PRIME. At this point, my tech friends start to ask why anyone would take debt. Here in Canada, an emergency doctor would make about $250,000/year in Ontario for working what works out (in shifts) to be about 25 hours per week, after he has finished his residency. Assuming this is a similar situation in the states, I don't see why this is so outrageous at all. Oh, and Doctor shortage? Really? It's medical schools that cap entrants, not the price. Take a look at all the qualified students who are rejected each year. I know a bunch.

rayiner 13y ago
In the states, federal graduate student loans are 8%.
- ryanhuff 13y ago
  Are you sure? When I did my MBA a few years ago, student loans were about 6.5%, and I thought I heard that rates were lower today.
  - rayiner 13y ago
    There are Stafford loans at 6.5% but they only go up to like $20k/year. GradPLUS covers the bulk of the cost and is at 7.9%.
eterpstra 13y ago
The reason medical schools cap the number of entrants is the same reason they raise tuition exponentially - it's expensive to run a medical school. It has nothing to do with the number of applicants. Also, 25 hours per week? My wife is a physician. Nobody at her hospital works less than 60. Most work 80 or more. Surgeons are close to 100. For many full time primary care physicians, it works out to about $10 / hour when first starting out.

cjc1083 13y ago

I'd say given the salary data, the fact that medicine is a stable and growing field, and the amount of high level training required , these numbers are not really crazy or out of line. http://www.profilesdatabase.com/resources/2011-2012-physician-salary-survey http://www.profilesdatabase.com/resources/2011-2012-physicia... After six years of practicing, even a non specialized doctor will be at 200K with the lowest starting salaries around 140K. That is a fantastic amount of money when you consider that it is the lower end of the pay scale for doctors and that it will be a completely secure position in which you can work until death or retirement. 250K is a small price to entry into 8Million+ lifetime earnings. Being highly successful in most fields is equated with 150K and beyond salary point, which comes with increased competition and no job security as you move up the ladder...I don't see this as being a bad deal at all, even for those totally self/debt funding.

nilkn 13y ago
Indeed, the salaries in medicine can be so absurdly high that $250k of debt is truly not as much as it sounds. If a dermatologist starts at $234k, then you could easily pay back $100k/year and still have a very comfortable chunk of change left over. And that's ignoring salary increases. In a few years, you'll be debt free making $350k. And you could see numbers of that magnitude even in cheaper rural areas where you'll live like a king. And I completely agree with you on job security as well. Once you start practicing, you're pretty much made for life.

mindslight 13y ago

Of course - you've got to be a True Believer to get that kind of leadership position, and he would have of course taught that to his son. These people actually believe that having any non-monthly expense able to be financed is a good thing, as it is then more "affordable", where affordable means not requiring any sort of planning or saving for the future. Of course this really just causes prices to shoot up, with positive feedback if the good can serve as collateral, which exacerbates the problem causing more people to finance. Essentially they are working to erode the utility of money itself, and revert us back to a social reputation based system where your stature in life depends on your creditworthiness and obedience to your job (stability required to make all those continuing monthly payments).