Harvard offers discount on med school tuition

Eligible students could save up to $12,500 a year.

By — Posted May 12, 2008

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Lana Lobachova expects to be more than $100,000 in debt when she graduates from Harvard Medical School two years from now. But that amount should shrink under Harvard's plan to boost its financial aid package for some medical students by as much as $50,000 over four years.

In March, Harvard announced that students whose families earn $120,000 or less a year will get up to $12,500 off the annual $65,000 cost of tuition and living expenses. The program will start with the 2008-09 academic year.

Harvard now offers $24,500 in subsidized federal and institutional loans to students who demonstrate financial need. Students whose families make $120,000 or less must contribute about $12,500 before being considered for an institutional scholarship.

Under the new plan, the Boston school would cover the $12,500 family contribution by increasing its institutional scholarships to $11 million annually. Of the school's 700 students, 235 would be eligible for the funds, to be distributed based on a school formula.

"I haven't worked it out yet, but I hope I will save a large amount," said Lobachova, who qualifies for aid.

Jeffrey Flier, MD, Harvard Medical School dean, said it is important for the school to ease students' debt, which averages $98,000 at Harvard, so graduates will be able to pick a specialty regardless of its income.

"If borrowing continues to grow, medical students will feel rising pressure to choose more lucrative specialties," he wrote in a letter detailing the effort. "Minimizing their debt, on the other hand, will ease this distorting pressure on their career decisions."

Harvard's initiative comes at a time of widespread concern among physician leaders that the rising cost of medical school discourages lower-income students from pursuing medical careers and sways some medical graduates to pick high-income specialties.

The median medical school debt is $140,000, according to the Assn. of American Medical Colleges. Today's graduates pay 9% to 12% of their income toward school loans, a figure that could grow to 25% to 31% of doctors' income by 2033, the AAMC said.

While physician leaders lobby for better student loan repayment terms and increased funding for tuition reimbursement programs, more medical schools are looking for affordable ways to attack the debt problem. In recent years, the University of Kentucky College of Medicine in Lexington and the University of Minnesota Medical School in Minneapolis capped tuition for incoming students. The University of Central Florida College of Medicine in Orlando plans to offer full scholarships for its first class of 40 students starting in 2009-10.

More schools may take notice

Harvard's action could have a ripple effect, said Paul Jolly, PhD, AAMC senior associate vice president. "I think other schools will look at Harvard's example, but not every school will be able to follow its lead."

Harvard can tap an endowment of $34.9 billion, which is far larger than other private U.S. schools, Dr. Jolly said. But Harvard is not alone in using its endowment to help offset students' costs. Stanford University in California, for example, offers enough scholarships that its average medical graduate's debt is $78,000, despite an annual bill of $70,000 for tuition and living expenses.

Some Harvard students have been critical of the school's initiative, saying it would be better if officials cut tuition instead of increasing scholarships. Still, most acknowledge that Harvard's effort has merit.

"This will make people's lives so much easier," Lobachova said. "Especially if you have siblings [in college] and you don't want your parents to pay for your graduate education."

David C. Dale, MD, president of the American College of Physicians and a Harvard Medical School graduate, said Harvard's decision is a step toward making medical training more attainable for those outside the upper class. "What Harvard is trying to do is support people of all financial and social backgrounds going into medicine," he said.

Perry Pugno, MD, MPH, director of medical education for the American Academy of Family Physicians, said there is no scientific evidence that debt influences students' choice of specialty, but anecdotal information suggests that medical students do look at income and debt as they consider specialty choices.

"Clearly, students are talking about needing to select a discipline that will provide them with a better income to serve that debt," Dr. Pugno said. "We hear from students quite frequently that they are interested in family medicine, but their debt is so high they need a higher salary. ... The average medical school graduate is carrying a debt that approximates [his or her] first year of income. That's a psychological barrier."

AMA Trustee Chris DeRienzo, MD, graduated this month from Duke University School of Medicine in Durham, N.C., with $170,000 in loans. He said more action is needed.

"It's fantastic schools are trying these novel ways to lessen the debt, but it's still important to push for reforms at the state and national level," Dr. DeRienzo said. "If we don't, we may not be able to attract low-income or minority students into medicine."

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