Student Debt in the Health Professions Limits School Choice, Career Paths

$200M Student Investment by Helen Diller Foundation Will Create Opportunities to Pursue Public Mission

Nathan Kim studies with fellow students at UCSF's library
Nathan Kim (center), a first-year medical student, was overjoyed to receive a scholarship from UC San Francisco, where he is studying to be an HIV doctor working in underserved communities. Photo by Susan Merrell

Nathan Kim knew that UC San Francisco’s School of Medicine offered the mentors and commitment to social justice he was looking for, but coming from a low-income background, he nearly turned down the opportunity after receiving a generous scholarship from another medical school.

Fortunately, a matching financial aid offer from UCSF allowed Kim to select his first choice.

“Since high school, I’ve wanted to be an HIV doctor working in underserved communities,” Kim said. “I was overjoyed to get in here, but it was like a God-given miracle when I got that financial aid email.”

Kim’s need to choose a university based on the level of financial support is one that more and more students are facing as the costs of going to school to train as a dentist, physician, nurse, pharmacist, or physical therapist have increased rapidly in recent years.  

Now more than ever, when students graduate as health care professionals, the majority walk away with more than a diploma – they are also saddled with sometimes hundreds of thousands of dollars in debt. The financial pressure can be especially troubling for students like Kim who hope to work with underserved populations or in primary care, career paths that tend to offer more modest incomes.

The impact of the rising cost and mounting debt is two-fold: Universities struggle to compete for the best students, and costs become the overriding factor for many students in deciding where to get their education and what to practice after graduating.

A significant boost to UCSF’s recruitment efforts will be a landmark $500 million gift from the Helen Diller Foundation, announced earlier this month, which will create a $200 million endowment for student scholarships. The investment is aimed at attracting the best and brightest to UCSF and enabling first-generation college students and low-income students to pursue graduate degrees in the health professions.

Rising Costs, Mounting Debt

The costs of training to become a health care provider has, in some instances, doubled in the last 20 years. According to the Association of American Medical Colleges (AAMC), the average in-state tuition at a private medical school today is more than $50,000 a year and $30,000 a year at a public medical school; 20 years ago, those figures were $23,000 and $8,400, respectively.

Pei-Chi Chen (left) and Nai-Yuan “Nick” Chang, dental students at UCSF, park their bikes in the courtyard near student housing at the Mission Bay campus. Nationwide, the average student debt per graduating dental students in 2016 was $261,149. Photo by Susan Merrell

Add in the cost of living in some of the nation’s most expensive cities, like San Francisco, and the total cost for a professional education can skyrocket.

According to the American Dental Education Association, the average student debt per graduating senior in 2016 was $261,149, up from an average of $55,000 in 1990. According to the AAMC, medical students graduated with a median debt of $180,000 in 2014.

The costs for schooling can deter many qualified students. Nationwide, only 3 percent of medical students come from families with incomes in the lowest 20 percent, while 60 percent come from families with incomes in the top 20 percent, according to the AAMC.

Universities Aim to Ease Financial Burden

Many universities across the country are attempting to ease the burden with more types of financial aid and scholarships.

UCSF has several initiatives, such as a housing stipend, to make UCSF as affordable as possible for all students.

“UCSF recognizes that we currently can’t meet 100 percent of the need for scholarships for professional students,” said Elizabeth Watkins, PhD, vice chancellor of Student Academic Affairs and dean of the UCSF Graduate Division. “What that means is that students are taking out loans and graduating with debt. We struggle to compete for the best students because they may get a better financial package at a competing institution.”

Amanda Voigt, a first-year medical student, chose UCSF because of its reputation for primary care education. Scholarships allowed her to attend the University. Photo by Susan Merrell

The scholarships to be funded by the new $200 million endowment could, in the future, help students like Amanda Voigt, a first-year medical student who knew UCSF was where she wanted to go, but says she could not have done so without scholarships.

“UCSF was my top pick because of its great reputation, especially for primary care education. But the cost of living in San Francisco wasn’t very favorable. At some other schools, I could live for a year on what it costs me to live here for three months,” she said.

Only when she was notified of her scholarships, which cover about 20 percent of her total costs, did she know she could attend her dream school. “I have to say that was one of the most exciting days of my life,” she said.

“What we find is that our applicants love our school, but when they’re actually thinking about coming here, they’re also thinking about the cost of living in San Francisco, in addition to the restricted amount of scholarships,” said Julia Hwang, admissions director at the UCSF School of Dentistry. “The people who turn us down, almost all of them cite financial reasons.”

Cost and Career Paths

The high ticket price of an education in the health professions – and the prospect of debt that can take decades to pay off – influence not only a student’s choice of school, but also career decisions after graduation.  

For pharmacy students, this may mean forgoing post-graduate training that can provide valuable clinical or research experience in order to find employment sooner.

“For students entering that training, that’s additional time when their financial resources are limited. This can be particularly significant for students who feel pressure to help support parents or other family members,” said Cynthia Watchmaker, MBA, associate dean of student affairs and education services at the UCSF School of Pharmacy. “Scholarships give them more freedom to pursue those options.”

For future clinicians, their specialty – primary care versus orthopedic surgery – and where they practice – a rural safety-net hospital versus a private clinic in a major city – may determine how quickly they can pay off their loans, and these individual decisions could play a role in health care access in years to come.

Student Loans at UCSF

The average loans last year of graduates from the professional schools
Dentistry: $194,874
Medicine: $139,457
Pharmacy:  $126,011
Physical Therapy: $99,314
Nursing: $44,101

The U.S. Department of Health and Human Services estimates that by 2025, 37 states will have a shortage of primary care physicians. In another analysis, 48 states are expected to have a shortage of registered nurses by 2030, with the highest need concentrated in the South and the West.

Rural and lower-income communities have an especially hard time attracting health care providers. Across California, for example, the San Joaquin Valley has the lowest ratio of dentists to patients, with 2.4 dentists per 5,000 people, compared to the Greater Bay Area, which has the highest dentist-to-patient ratio at 5.1 per 5,000.

Voigt, who is from Fresno, hopes to return to work as a primary care physician in the medically underserved regions of the Central Valley. She said that her scholarships will reduce her overall debt from medical school to make that feasible.

“I’m going to graduate with $200,000 of debt,” she said. “Hopefully it won’t change my career choice, but I can’t say that about other students, especially if they’re graduating with more debt.”

Elicia Fox Chaney, who will graduate as a nurse practitioner this year, estimates she could make 30 percent more working in a private hospital but hopes to continue at a safety-net hospital like Zuckerberg San Francisco General Hospital, where she’s already been working part-time. “I’ve been grateful that I’ve been able to get scholarships that will allow me to take a job somewhere I believe in,” she said.

“So many of our students come to UCSF because they like our public mission to serve underserved populations,” Watkins said. “We are extremely grateful that the new Helen Diller Scholarship Program will help us attract the very best and most diverse students from around the country – and to allow them to follow their passions after graduating.”