AAMC Reporter: December 2009

A Word from the President: "Are We Turning the Corner on Student Debt?"

In addition to health care reform—which so clearly dominated the headlines in 2009—another less visible issue that continues to be of great concern within our community is student debt. At almost every one of the nearly 50 organizations to whom I spoke this year, student debt was among the issues raised most frequently. And, as evidenced at our 2009 Annual Meeting by the standing-room-only plenary on this topic (jointly sponsored by our Organization of Student Representatives [OSR] and Organization of Resident Representatives [ORR]), the issue remains top of mind for many of our constituents.

With 2009 drawing to a close, I was encouraged to learn of two developments. First, this year's medical school enrollment figures continued the upward trend of recent years, increasing by 2 percent over 2008 to nearly 18,400 students. While it is unlikely that the recession had an effect on these numbers (since these students applied between June and September of 2008), we do know that signs of the failing economy were all around us long before they surfaced in official economic indicators. However, what really drew my attention was news that in 2009 the average medical education debt was $156,456. This represents a 1 percent increase compared with last year, and the smallest per year increase we have seen since we began tracking this data nearly 30 years ago. Just as many suggest we now may be pulling out of the recession, these data led me to wonder whether we might be turning the corner on student debt.

For example, when the class of 2009 began medical school four years ago, the economy was much different than it is today. Yet, despite the increase in the cost to attend medical school during this time, the 2009 education debt level remained nearly flat. While it is tempting to say these data look promising, the reality is that they might be explained by any number of factors, including increases in student loan interest rates.

Further, this sign of flattening debt does not negate that nearly 9 of 10 students (87 percent) still carry a heavy debt load. Especially worrisome is that all signs point to further cutbacks in state budgets, and therefore, support for public medical education. On an institutional level, we know our development offices are also feeling the pinch. Philanthropy specifically designated for scholarships in 2008 dropped 14.5 percent, after a record median of nearly $1 million in 2007.

While we cannot yet proclaim that we have turned the corner on student debt, I am heartened to report that, like many other issues this year, this concern has brought our community together, and in innovative ways. For example, the AAMC worked diligently with the financial aid community, the AAMC Group on Student Affairs Committee on Student Financial Aid, and the OSR to further develop our new Financial Information, Resources, Services, and Tools (FIRST) for Medical Education. Launched in May 2008, this extensive portfolio of debt and loan management information now includes over 30 fact sheets, several podcasts, links, and other materials covering every step of the loan and debt management process. The FIRST Web site continues to add to its library of resources and shows steady growth in its audience. Last month, FIRST was accessed by thousands of visitors from 80 different countries, 62 percent of whom were new to the site.

We also are engaging in more extensive outreach, both in the number of in-person campus visits (over a third of our medical schools) and target audiences served. In addition to high school students, medical students, and new physicians, we work hard to support our financial aid officer constituency and provide resources for prehealth advisors. We are also reaching students much earlier in the process, in many cases during the first year of medical school.

Third, we are putting together data in new ways—such as comparing information on student debt to other AAMC-generated data—to more fully appreciate the economics behind financing medical education debt. I am pleased to report that we increasingly are gaining a better understanding of how individual decisions and loan repayment choices affect the long-term financial health of students.

Fourth, we are more deeply involved with efforts to strengthen federal government loan repayment and forgiveness programs and actively promote these programs to students and residents. The AAMC coordinates a group of National Health Service Corps (NHSC) stakeholder associations to support expanded opportunities for health professional scholarships and loan repayments. Additionally, we are collaborating with the NHSC to increase recruitment efforts for awards under the American Recovery and Reinvestment Act.

While it is too soon to say we have turned the corner on student debt, we do know that significant hurdles lay ahead in 2010, and that true to our values, the issue will remain a top priority. By galvanizing support on this issue, we aspire to reach even higher levels of constituent service. I cannot think of a better way to conclude what has been a watershed year in so many respects than by commending the extraordinary collaboration that has taken place within our community, and by offering heartfelt thanks to everyone for their efforts. My sincere hope is that next year at this time, I will be writing that we have, in fact, started to turn the corner on student debt.

Darrell G. Kirch, M.D., AAMC President and CEO