About To Drink The Kool-Aid

Most long-running blogs I read have a “sorry its been so long since my last post”, post.  If this is a generally-normal reality of long-running blogs, then maybe SW101 can officially call itself that.

I haven’t been writing for about 1000 reasons, but I think the most draining of them has been the job search.  Finding a job as a doctor is tough.  Let me be clear: not tough like it must be for a house-framer with 2 kids and an upside-down mortgage.  But tough to make sure I’m not making a mistake.

Medicine is so owned.  There are just so many stakeholders in the entire enterprise that being a doctor today is a bit akin to indentured servanthood.  In some respects, this is great.  Better to be someone’s servant than nobody’s king.  But in my world, it IS rather easy to make an un-critical choice and end up even more owned than you need to be.

I owe TONS of money to lenders who “helped” (in the way pedophiles “help” little kids with their math) me get through an over-priced undergraduate experience and then medical school.  Yes, I’m bitter about the experience because debt rules my life and will continue to until I am well beyond my youth.  All of my best years will have been spent paying off debts before I’m finished.

For that reason, choosing a job is edgy business.  Family docs are in demand, even in today’s economy.  So, many of the places I’ve applied are offering numerous incentives like sign-on bonuses and loan-repayment.  They both sound great, right?  Just sign up for whoever is offering the best deal, right?

Well, let’s start with the “sign-on bonus”.  Every place I’ve spoken with offered one of these…but it would need to be “forgiven” by working with them for 3 years.  Immediately, it should be clear that this, then, isn’t a signing bonus, its a retainer, which is much different.  Granted, true signing bonuses are a rather dimwitted business maneuver, but I hate the disingenuousness of calling it one thing that implies no repayment, but really meaning something that in fact does require repayment.

Then the loan reapayment.  I’ve been offered as high as $45,000!  Amazing, isn’t it?  In addition to my above-average salary, I’m being offered the average salary of a luckily-employed American to help pay off loans.  Of course, like the “bonus”, it has to be paid back too.  Over years.  So, both benefits amount to more effective debt for me.  I will owe time rather than money, but I still OWE someone.  Since I owe them…they pretty much own me.  Given all the people who already have their teeth in my ass, I’m surprised yet another entity thinks they have can gnaw a chunk out of my back side, but apparently they want to try.

I should mention that both grants are taxed, which changes everything also.  Take the loan repayment.  45k?  Nice.  How much will I see?  About 30-35.  Still a lot of money, yes.  But let’s not forget how much I owe: $320,000, compounding at an average rate of about 8%.  That 33k will barely pay off interest on all that I owe…and I’ll still owe the person who gave me the money 3 years of my life.  It’s debt on top of debt.

So, I’m close to signing with a local HMO that is offering some loan repayment, but is letting me work for it, which means they’ll come up with some cash at the end of 3 years.  Yes, I’ll lose on the front-end given the cost of interest…but I’ll keep my freedom.  Well, that’s certainly a matter of perspective, but I’ll keep something.

My apparent need to keep some semblance of control over my life reminds me of the movie Dead Man Walking.  At the end of the movie, as Sean Penn is about to be led from his cell to the execution chamber, he freaks out and puts up a huge fight because the guards want to take his boots.  True, your boy ain’t going somewhere that will ever require boots.  But that’s not the point.  They represented his only real hold on control over his life by the end.  I feel a little bit that way.  Sure, I’m losing by not getting any up-front money, and sure, I can’t leave any job EVER until I’m retired because of all my other debts.  But at least, coming out of residency, I’m not adding yet another person who owns my life.  At least I’m still as much my own man as I was before I signed on to a new job.  Freedom, even a wisp of it, is worth the sacrifice.

Next up:  The job itself and how it won out over the others.

Why No Doctors in Them Thar Hills?

‘Cause there ain’t no money for ’em…that’s why.

By ‘hills’ I’m implying rural America, and unfortunately, most people living there pay for doctors through medicare.  As I’m sure you’ve heard, this lovely Guv program pays less than cost in many circumstances, which is a great primer for how to go bankrupt, but isn’t a good way to keep doctors around.

In general, there are many doctors who would gladly forgo the demand for actual dollars as compensation for their years of training and constant hard work.  American history is full of examples of small-town country docs accepting cremed marmelade and a basket of Emu eggs as payment for little Dirk’s delivery and circumcision.  Those days are disappearing, of course.  The reason for it is actually quite simple:  Medical training today costs close to 8 yearly incomes of an average middle-class American family.  In rural areas, where most families are hovering at the poverty line, training a doctor would cost roughly (emphasis on rough) the entire yearly salary of 3 low-income rural families for 8 solid years.

Few can afford this, of course.  Especially altruistic types, who tend to be broke in the first place.  So would-be doctors these days go into debt for the money.

And then the banks come callin’…and they aren’t happy with 3 chickens and a haircut every month for the next 40 years.  They want cash.  Bear in mind that Uncle Ebeneezer will at no time recognize concepts like “quaint Americana” or the notion of “civic duty”.  Civic duty to your average banker consists of leaving only one desk light on at night…the one illuminating the stunning windfall of interest payments soon to be arriving from the hapless big-hearted doc in Flish, SD.

“But!”  Our wise Guv exclaims, “Let’s institute loan repayment program! We’ll make it available to doctors who are willing to work in areas we will designate as ‘under-served’.  We’ll offer HUGE sums of loan-repayment money.  Something like $20,000!  Who can resist that?”

Great idea.  Except that every great idea from government has to be governmented, which then quickly turns it into a really stupid idea.  Governmenting.  It’s my new invention.  I’ve transmorgified a noun into a verb.  Since it’s my invention, I get to define it: 

Governmenting, v. – The act of taking a perfectly reasonable idea that could benefit vast swaths of Americans, endorsing it, and then subjecting it to a kaleidescopic array of regulations, bizarre armchair ethics, vague definitions and hyper-polysyllabic word definitions such that the initial idea is not only forgotten but dwindles into laughable obsolescence.

Yes, the Guv offers an average of $20,000 per year of loan repayment.  Sounds fantastic, right?  Except that the average doc owes $250,000.  “Quit complaining, you brat!”  You might exclaim, “It’s pretty good money even if it’ll take you awhile to pay off the loans.”

Actually, that’s true.  Some people work an entire year just to pull in around $20,000.  In fact, docs are still occasionally heading for the hills with just this argument ringing in their ears.  As he drives down dusty I-90 toward the incomprehensibly-named “Crow Agency” Montana (leave it to the Guv to name a town an agency), young Dr. SW thinks to himself, “Hmmm.  250k divided by 20k equals 12.5 years.  Working out here brings me substantially less in yearly salary, so that 20k will be all I can contribute to my loans.  But 12 years.  That ain’t bad.  I can take it.  Nice view, after all.

But here’s the problem…the REAL problem with Governmental loan repayment programs.  It’s very simple.

The repayment is taxed.

The English language is too limited to describe the stupidity of this.  The same entity that gives the money takes it right back before the hapless doc – standing in his new Wrangler jeans at the bean-mash and Chevy show – actually gets to pay those loans.  And the entitiy who paid the loan doesn’t think of themselves as the same as the entity who is doing the re-taking so they often don’t even mention this taxation concept to docs before they sign their contracts.

To someone’s credit (no idea who), they’re coming clean recently about the taxation issue, inserting a disclaimer into their recruiting material.  Jammed forgettably into the back of the glossy packet I received extolling the virtue and adventure of working on the frontier, was this:

Participants in the LRP (loan repayment) will be paid up to $20,000 per year for signing a 2-year LRP contract and agreeing to serve full-time clinical practice at a designated Indian health program priority site in the United States.

It should be noted that LRP benefits have been ruled to be subject to FICA (social security) taxes.  This means that 7.65% of the loan repayment amount will be withheld and sent to the SS Administration.  Additionally, 20% of the LRP contract amount will be sent directly to the Internal Revenue Service to assist in paying the additional income taxes incurred as a result of participating in LRP.

This means nearly 30% of a doctor’s loan repayment grant is re-taken before it can be applied to the actual loan.  And remember, the base salary of rural docs is significantly lower than that of city counterparts, so the grant repayment is important.

The system needs repairs on many levels.  Universities need to charge less (maybe landscape less or something).  Banks need to make funds available at less profit.  Training needs to be shorter – everywhere else in the world, doctor training is 6 years after high school and then residency.  In the U.S. the training takes 8.  And a big part of the solution needs to be Government programs that are genuinely viable, moral and rational.  The current system tricks doctors into taking low-paying jobs in distant lands and traps them there by helping them with much less of their loans than they expected.

There’s lots of things that need fixing, but one of the first should be to stop all the governmenting.