What’s happening with tuition?
The cost of medical education has risen substantially over the past two decades. In 1981, the average tuition and fees at public and private US medical schools were $2761 and $8962, respectively. In 2002, the average tuition and fees at public and private US medical schools were $14,577 and $30,960, representing increases of 528% and 345%, respectively.(1) Below is a graph illustrating these increases over the past decade.
Where does the tuition money go?
For public schools, the percentage of medical school revenue that is derived from tuition and fees is about 3% on average; for private medical schools, the percentage is about 5-8%. However, there is a wide range in the percentage of total revenue that comes from student payments, anywhere from 1% to 44%.(2) For about 50% of the US medical schools, the entire tuition revenue is directly retained, while about 12% of schools retain only a portion of the tuition revenue. About 38% of schools have tuition income go towards their health science center, the central university administration, the state, or a combination of these areas.(3)
How much of my tuition money actually goes towards funding my medical education?
There have been several studies conducted over the last 3 decades investigating the annual costs of educating a medical student, both in terms of instructional costs and educational resources costs. These studies have found that instructional costs range anywhere from about $48,000 to $51,000 per student per year, and educational resources costs from about $80,000 to $105,000 per student per year (adjusted for 2002 constant dollars).(4) Instructional costs are primarily comprised of professor salaries and costs that relate directly to the teaching program, while total educational resources include all activities of teaching, research, scholarship, patient care, and maintenance of facilities.(5) Therefore, tuition does NOT cover all costs to fund your medical education. This inherently means that medical schools must derive funds from other sources.
What sources do medical schools derive their revenue from?
Medical schools have several sources that contribute to their overall revenue stream. For example, below is a table and chart illustrating the breakdown of medical school revenues in 2001-2002.(6)
|Revenue Source||2001-2002 Percentage (All Schools)|
|Hospitals/Medical School Programs||12.5|
|State and Local Government Appropriations||7.1|
|Parent University Support||0.6|
|Tuition and Fees||3.3|
|Total Grants and Contracts||31.7|
Allopathic medical schools generally derive a very small percentage (10% or less) of their total revenue from tuition. However, osteopathic medical schools depend more on tuition (15% to almost 50% of their revenue).(6) This is because osteopathic medical schools generally do not receive as much grant money (research funding), government funding, or hospital revenue as allopathic institutions. Due to changes in our health care system, the economy, and other external factors, practice plans and hospital revenue account for increasing portions of total revenue, while grants (research funding) are decreasing. For example, below is a graph illustrating changes in three areas of revenue over the past three years. These changes have a significant impact on the three-legged stool of academic health centers: teaching, research, and clinical practice.(6)
While some of these percent changes may seem small, the overall effects of these changes account for millions of dollars of revenue being derived from alternative sources such as endowments, government appropriations, or gifts. Recent downturns in state economies have forced statewide budget cuts, thereby affecting state appropriations for graduate and medical education. Therefore, tuition becomes an important source of funds for medical schools to compensate for reductions in other revenue streams. However, it is interesting to note that overall medical school revenues have been increasing over the past decade. This means that although tuition and fees may account for around 3% of revenues on average from year to year, the overall increases in revenues indicate that tuition is increasing at a much higher rate since the 3% is part of a larger overall revenue stream.(4) Furthermore, expenditure levels do not clearly indicate where these additional revenues are going; for example, instructional costs have gone from about $47,000 per student per year in 1974 to $51,000 (7) per student per year in 1997 (8) (adjusted to constant 2002 dollars).
Who determines the tuition rates?
Surprisingly, most medical schools do not have the authority for setting the tuition levels. For example, in the year 2000, only 33% of US medical schools had their tuition levels set by the medical school or health science central administration. For about 47% of schools, the tuition was determined by the Board of Trustees of the parent university. And, in about 20% of schools, the state legislature or other state authority had the final say in tuition levels.(3)
What can I do? – AMSA’s Student Action Guide
There are a few key things you can do at your home institution to advocate for changes in the current tuition trends. You might not be sure of where to begin, but AMSA’s step-by-step guide will take you through the process.
- Gather information
- Know the terminology
- Organize for change
- Know your targets
- Know what can be done
- Start a campaign
- Let us know what you are doing
- Association of American Medical Colleges, Washington, DC. Medical School Admission Requirements. various years.
- Liaison Committee on Medical Education Annual Medical School Financial Questionnaire 1997-1998. The questionnaire was sent to all 125 LCME-accredited medical schools and had a 100% response rate.
- Liaison Committee on Medical Education Annual Medical School Questionnaire-Part II 1999-2000. The questionnaire was sent to the deans of all 125 LCME-accredited medical schools and had a 100% response rate.
- American Medical Association, Medical Education Group, Chicago , IL . Report on the Council on Medical Education – CME Report 2-I-00/Medical School Financing, Tuition, and Student Debt.
- Jones RF, Korn D. On the cost of educating a medical student. Academic Medicine 1997;72:200-210.
- Liaison Committee on Medical Education Annual Medical School Financial Questionnaire 2001-2002. The questionnaire was sent to all 125 LCME-accredited medical schools and had a 100% response rate.
- Undergraduate medical education elements, objectives, and costs. A report by the AAMC Committee on the Financing of Medical Education. J. Med. Educ. 1974;49:101-128.
- Franzini L, Low MD, Proll MA. Using a cost-construction model to assess the cost of educating undergraduate medical students at the University of Texas-Houston Medical School. Academic Medicine 1997;72:228-237.