New Funding Model Could Create a Debt-Free Medical Education
Would you be interesting in completing a pre med program at your dream university without accruing a mountain of debt? How about a graduate program?
While these questions may sound farfetched, they are not only legitimate propositions, they are the foundational questions of an initiative being led by Jeffrey P. Gold, MD, chancellor of the University of Nebraska Medical Center, who hopes to change the financial future of medical education.
Whether you are a prospective medical student, a student in rotations or a resident, you are most likely aware that student loans are a major issue for many in the healthcare industry. In 2015, the average tuition cost for a four-year medical student at a public MD-granting university was $226,447, according to AMA. While there are some students who can afford this type of loan, there are far more who can’t.
Gold has spent over a decade passionately trying to solve this issue. He spoke in front of an audience at the AMA’s ChangeMedEd conference last October offering a vision that could not only change the future of medical education, but also eliminate the current reliance on traditional Medicare and Medicaid funding.
Gold and his colleagues revealed that the current UME (undergraduate medical education) and GME (graduate medical education) funding mechanisms are in need of serious revision. He said:
“Out of the $2.81 trillion spent [on health care] in 2012, the total spent on all of medical education—[including] undergraduate and graduate—is approximately $20 billion in the United States, or 0.68 percent.”
He is targeting this 0.68 percent because this money is not easily traced or sufficiently measured. Gold says:
“We want to focus on how we can better spend that 0.68 percent… It is better to use this tiny sliver and realign it to increase access and improve quality.”
Gold offers a solution to replace current funding models: An all-payer system for GME and UME funding that would be a more efficient, more concise and more transparent use of capital.
This all-payer system would allow government, commercial, private entities and self-pay individuals to invest their money into a trust fund facilitated by the Medical Education Workforce that would create and cover all costs of undergraduate and graduate medical tuition.
The central MEW fund would replace the historic and heavy dependence of GME on Medicare and Medicaid and would employ a “funds-flow” mechanism that would equitably lobby and distribute the costs among all stakeholders. Gold said:
“We propose the establishment of a novel all-payer system whereby government, commercial and private entities, as well as self-pay individuals, invest in the education of all physicians in exchange for the highest quality of health care.”
Mimicking a work for return model, medical students would be asked to offer their professional health care services after completing their GME in a designated area of their chosen specialty.
For the physicians who wish not to participate in the service portion of the program, there would be an alternative option requiring physicians to repay their tuition and fees through a market rate educational loan (including compounded interest) that is similar to the existing federal loan programs.
Gold’s proposed plan would not only eliminate most or all medical student debt, it would help advance additional areas of medical education, including increased scholarship funding for underrepresented students in medicine, which Gold says, has been a longstanding problem in the industry.
Although many are comfortable with the existing standards, a new system, like the one Gold offers, would enhance the already existing alignment, increase transparency among medical education dollars, and would provide a clear linkage of funding to the development of the healthcare. While Gold and his team have yet to receive authorization for this initiative, they are hopeful in their beginning stages of transforming the financial aspect of medical education.