NYU Medical School recently announced it will waive tuition for all medical students, now and going forward. NYU has raised $450M of the needed $600M to fund this gift in perpetuity. Kenneth Langone (one of the Home Depot founders) and his wife donated $100M.
One reason NYU made this commitment was because many medical students are saddled with crushing debt when they graduate. Basic economics pushes them to choose higher paying specialties to help service their debts. Basic economics argues against choosing lower paying specialties. NYU wanted graduating students to select their specialty based more on passion than on need.
One ER physician wrote that he struggles to may his monthly loan payment.
“The crisis of paying for education has finally caught up with the one percent….
I am far from alone. A mentor in residency, several years my senior and making over $200,000 per year, once revealed that she had moved back in with her mother just to get a handle on her student loans. Another colleague had a marriage proposal rejected because of his mortgage-size debt….
If student debt is a problem for doctors, imagine what it is like for nurses, teachers and other graduates whose incomes are far lower. Indeed, an entire generation is being squeezed by the high cost of tuition at the graduate and undergraduate level. Without expendable income to buy homes, millennials are living with their parents in record numbers, stunting the housing market. Unable to save, my generation is neither contributing to nor benefiting from the stock market. Most doctors will someday earn enough to pay off their school loans. But many thousands in less lucrative professions will carry their loans into middle age and beyond. The burden that is bowing medical students has truly been crushing lower- and middle-income graduates.”
Not surprisingly, many people have opinions on whether NYU’s policy is the best way to help medical students. Some have argued that tuition should be waived if and only if the students ultimately choose a lower paying specialty or work in underserved areas. Others have argued that tuition should be waived only for families of limited means.
NYU is free to do what it wants. I believe one main motivation was to differentiate the school from others and attract the most talented students. Free tuition will achieve that end. One two-year “college”, Deep Springs, embraces a similar tactic.
Founded in 1917, Deep Springs College is a unique institution of higher learning. The educational program is built upon three pillars: academics, self-government, and manual labor. The school is located 40 miles from Bishop, California on an isolated cattle ranch in Deep Springs Valley.
Between 12 and 15 students are admitted each year. A scholarship covers the costs of tuition, room, and board for every student offered admission. In exchange, Deep Springs students are expected to dedicate themselves to lives of service to humanity. Alumni have gone on to exemplify this ideal in a wide variety of fields, including politics, science, journalism, academics, agriculture, medicine, law, business and design….
In addition to academics and self-governance, students are expected to participate in labor for at least 20 hours each week. Labor includes farm and ranch work, but also other daily tasks such as cooking, cleaning, and maintaining facilities and vehicles. Not only practical, the labor done by students is considered to be essential to the educational program.
Deep Springs gets the cream of the crop. Its graduates frequently finish university at an Ivy League college. Unlike NYU, Deep Springs bundles in room and board. Of course, its students are working on the farm, cattle ranch, bakery, and kitchen. So, there is no free lunch. (Deep Springs was a male-only institution until recently. Women are now admitted. The trustees filed a lawsuit to overturn the funding trust document to harmonize the founder’s guiding principles for funding with 21st century sensibilities. This case was appealed all the way up to the California Supreme Court)
I do not believe NYU should tie its tuition waiver to choice of specialty or location of practice. If the gift comes with strings, students could just as easily join the military and have the armed forces write the check. Or participate in the Indian Health Service Loan Repayment Program. Or any other number of programs.
NYU is embarking on an experiment to see if eliminating one variable (crushing loan repayment) moves the needle on specialty choice. This experiment will play out over time. Regardless, NYU should see an uptick in highly qualified applicants.
What do you think?
About the Author
Jeffrey Segal, MD, JD
Dr. Jeffrey Segal, Chief Executive Officer and Founder of Medical Justice, is a board-certified neurosurgeon. In the process of conceiving, funding, developing, and growing Medical Justice, Dr. Segal has established himself as one of the country’s leading authorities on medical malpractice issues, counterclaims, and internet-based assaults on reputation.
Dr. Segal holds a M.D. from Baylor College of Medicine, where he also completed a neurosurgical residency. Dr. Segal served as a Spinal Surgery Fellow at The University of South Florida Medical School. He is a member of Phi Beta Kappa as well as the AOA Medical Honor Society. Dr. Segal received his B.A. from the University of Texas and graduated with a J.D. from Concord Law School with highest honors.
If you have a medico-legal question, write to Medical Justice at infonews@medicaljustice-staging.shfpvdx8-liquidwebsites.com.
I am truly happy that NYU is able to do this for its medical students. And its dental students? Dental students graduate owing over $400,000. When I was applying to dental schools back in the 1980s, NYU was obscenely expensive. When discussing finances I was told that I would pay the first semester’s bill and then get financial aid –
and that I didn’t have to give them cash, they would accept a check. How generous. Needless to say, I went to a SUNY school. The scholarships awarded by NYU should specify a period of time serving in an underserved portion of the state or region. These scholarships won’t deter students from seeking training and positions in a more lucrative specialty because, face it, most people will seek training to earn the highest salary they can in their chosen field. As far as teachers earning significantly lower salaries – it depends on location. My mother retired from the NYC school system at the top of her pay scale with 3 Master’s degrees and a professional diploma, earning less than $60,000. My sister started her teaching career on Long Island, NY earning over $75,000. This was all over 25 years ago. My sister is eligible to retire in 5 years with 75% of her salary and full benefits as her pension.
I had to pay for medical school, why the hell shouldn’t others?? We were NOT a “priveleged” family, either. If those doctors go to school for free, they should work for free.
I don’t believe many students choose a residency based on paying off student debt,and if they do I suspect they will likely regret this major life decision. In addition, the higher paying specialties typically have longer residency/fellowship tracks, so the debt grows longer and they will have fewer working years to make up for the lost years.
I paid off my “crushing” medical school debt in the first year I worked as a “real” doctor largely because I moonlit and paid it down when I could as a resident and then lived like a resident once I had a high salary throwing most of it at the debt. The worst part was finding out that the city of Philadelphia has a “city” tax that they failed to tell me I wasn’t paying for 7 years and finding out after I wrote the celebratory final check that I still owed $20000 in taxes, penalties and interest…but, I’m over it because I saved hundreds of thousands of dollars by not carrying the debt over forever….if only I’d opened an IRA as an intern.
The problem is far less that the debt is “crushing” but far more that medical students aren’t educated on how to transition from debt to gluttony or fail to control their desire to spend “like a doctor”….
If NYU was truly only interested in encouraging more students to go into primary care, then they should have offered the free ride only to those who pledged to do so. Personally, I don’t know anyone who desired to go into primary care but didn’t because of their loans and instead went into plastic surgery/body contouring or dermatology. My colleagues went into their chosen specialties because that’s what made them happy. The average med student has no concept of what it is to pay off debt. They have already been lied to by their schools, being told how much in demand they will be because of the looming (and farcical) “doctor shortage.” Those who choose a specialty based on financial potential will still continue to do so; I do not see how this “experiment” will reduce the production of money-hungry specialists who will need to be fed.
Whether intentional or not, this experiment is one step towards the socialization of medicine: subsidization of medical education. Not by the government in this case, but there is a starting point for everything.
As a graduate of NYU I am very proud of them doing this and I am grateful for the amazing education I received. I am also glad that I graduated years ago and I’m not a recent graduate with over $200,000 in debt. I remember upon graduation my very painful “exit interview” where I learned just how much money I owed. For those naysayers and people making negative comments it is nice to know that Scrooge is alive and well.
I worry this will someday be use a reason for future cuts to physician pay….well, we paid for your education. In the short term is seems really nice, but what happens down the road we will see.
After 19 years in practice, we have seen insurance reimbursement decrease every year without exception. Reimbursement for tonsilectomy is around $249.99 now. NYU finally figured out the problem and how to fix it. Since physician salaries are approaching zero, they figure it’s best to call their elite, democratic socialist benefactors to bail them out. SUNY Downstate tuition from ’99-92′ was $5,500/year. What in the world happened? Student loans will go with the student to the grave, and the government will lend tuition to anyone. Sad, sad situation…