Aug 25, 2022 - Health

Biden loan cancellation just a drop in the bucket for medical students

President Biden announces student loan relief on Aug. 24

President Biden announces student loan relief on Aug. 24. Photo: Olivier Douliery/AFP via Getty Images

President Biden's student loan forgiveness may help medical students chip away at the mountains of debt they accumulate, especially if they still owe from their undergraduate studies.

Why it matters: Almost three quarters of all medical school students had education debt when they graduated in 2021, most of it usually tied to federal loans.

By the numbers: On average, medical students graduated with $203,062 in education debt according to data for the class of 2021 from the Association of American Medical Colleges.

  • 30% had debt left from before medical school, with a median amount of $27,000.
  • The four-year cost for medical school for the class of 2022 ranged from $263,488 for public schools to $357,868 for private schools.
  • In 2022, medical residents made on average $64,200 per year, according to a 2022 Medscape Resident survey. That means many should qualify for Biden’s forgiveness program, since the salary cut-off is $125,000.
  • Fully trained doctors will likely be shut out. The Bureau of Labor Statistics estimates that a pediatrician makes around $198,000 while a cardiologist makes around $331,000.

Between the lines: While physicians often become high earners, they still have to go through years of residency training to reach that salary level. The interest on their student loans is increasing during that period.

  • Given the parameters the Biden administration laid out, almost all medical residents and most current medical students should qualify, Matthew Shick, senior director of government relations and regulatory affairs at the Association of American Medical Colleges, told Axios.
  • “$10,000 to $20,000 forgiven in terms of over $200,000 in debt might not sound like a lot, but everything helps,” said Shick. “It’s good to receive that help early in your career in medicine, because then the interest isn’t accruing as long.”
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