Graduate Medical Education:
Trends in Training and Student Debt
GAO-09-438R: Published: May 4, 2009. Publicly Released: May 4, 2009.
The federal government invests significantly in medical education through various programs to help ensure that the anticipated supply of new physicians meets the nation's health care needs. Medicare, the federal health care program for elderly and certain disabled people, subsidizes training for medical school graduates in hospitals and other teaching institutions by helping to support the increased costs associated with postgraduate medical training. These subsidy payments provided hospitals and other teaching institutions with an additional $8.76 billion for postgraduate medical training in fiscal year 2008. In addition, Medicaid, a joint federal and state program that finances health care for certain low-income individuals, provides funding for graduate medical education. In order to pay for medical school tuition and related fees, students often rely on loans to finance their education. The Department of Education (Education) administers loan programs that are available to medical school students. These loans may be made by private lenders and guaranteed by the federal government or made directly by the federal government through a student's school. The Health Resources and Services Administration (HRSA) administers various scholarships, loans, and loan repayment programs for disadvantaged students and those committing to practice in underserved areas or train in specific specialties. In addition, the Department of Veterans Affairs provides funding and training opportunities for new physicians in its medical facilities. Students must complete an undergraduate education and typically 4 years of medical school, at which point they earn a medical degree and become physicians. By their last year of medical school, students typically choose a specialty in which they will undertake required postgraduate medical training, known as residency, in order to practice medicine without supervision. Most specialties can fall into three general categories: primary care, surgical, and procedural. Most students apply for residency through the National Resident Matching Program (NRMP), which matches applicants with residency programs based on the preferences of both parties. However, because more students apply for some specialties than positions are available, some students may not receive a position in their preferred specialty. Residency can last 3 to 5 years, depending on the specialty. After residency, some physicians may decide to pursue further postgraduate medical training, known as a fellowship, in order to become a subspecialist. For example, to become a cardiologist, a medical school graduate must complete an internal medicine residency followed by a cardiology fellowship. In some cases, depending on the specialty or subspecialty, a physician could spend 7 or more years in postgraduate medical training. Congress asked GAO to provide information on graduate medical education. Specifically, we focused on (1) trends in postgraduate medical training, (2) factors that influence medical students' specialty choice, and (3) trends in the amounts of student debt incurred by medical school graduates. Enclosure I contains information on graduate medical education. You also asked us to provide information on trends in postgraduate dental education and student debt and thoracic surgery fellowships; that information can be found at enclosures II and III, respectively.
In summary, we found that medical students prefer surgical and procedural specialties, and physician subspecialization is increasing. Relative to the number of available residency positions, more medical students have preferred surgical and procedural specialties over primary care specialties since 1999, according to national data. As a result, surgical and procedural specialties have been more competitive than primary care specialties. Students earning an MD degree from U.S. medical schools fill higher proportions of the more competitive surgical and procedural residency positions than students earning a DO degree and students graduating from international medical schools. In addition, the percentage of physicians pursuing subspecialty training grew from 2002 to 2007, according to national data. This trend was observed in fields such as orthopedic surgery (a surgical subspecialty), anesthesiology (a procedural specialty), and family medicine (a primary care specialty). Multiple factors and demographic characteristics influence students' specialty choice. While there is no consensus on the most influential factors affecting specialty choice, students consider various factors either individually or in concert when selecting a specialty, according to multiple sources, including published literature, a 2008 AAMC survey, and experts we interviewed. For example, students may consider their intellectual interest in the specialty, their exposure to the specialty, or the prestige of the specialty when making their specialty choice. Some factors may also lead students to pursue certain specialties while avoiding others. For example, the desire for a controllable lifestyle--a predictable schedule and fewer on-call hours--and high salary may lead students to pursue procedural specialties such as anesthesiology, and avoid other specialties such as primary care. Demographic characteristics such as gender and marital status are associated with student being more likely to enter certain specialties. For instance, married students are more like to select primary care specialties and women are more likely to select obstetrics and gynecology and less likely to choose surgery. Although medical student debt is rising, physicians are eligible for federal loan repayment relief plans during postgraduate medical training and can eventually earn high incomes that can be used to repay their loans. Medical school tuition and fees have increased significantly since 1998. Medical students can borrow up to $40,500 per year through the federal Stafford loan program with additional funding available through other federal loan programs; these loan programs can cover the full cost of medical school. The median amount of educational debt for indebted medical students graduating in 2008 was $155,000--a 53 percent increase since 1998, controlling for inflation. Once out of medical school, residents earn stipends--on average about $3,729 a month for a 1st year resident. With $155,000 in debt, a resident's monthly loan payment could reach over $1,700 (about 48 percent of pretax income). However, residents have repayment options that can reduce their monthly debt payment until they complete postgraduate training. One option that will be available to borrowers after July 1, 2009, would cap the average 1st year resident's loan payments at about $364 month while a second option--forbearance--allows for a temporary postponement or reduction in loan payments. Physicians generally do not qualify for these options once postgraduate training is complete because, although they incur more debt than other advanced degree holders, they also earn higher incomes.