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Discuss Latest WCI Blog Post: Should You Apply for the HPSP to Pay for Medical School?

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  • Discuss Latest WCI Blog Post: Should You Apply for the HPSP to Pay for Medical School?

    If medical school costs worry you, the HPSP might be an option. But with military service tied in to the equation, here's what to consider.

    The post Should You Apply for the HPSP to Pay for Medical School? appeared first on The White Coat Investor - Investing & Personal Finance for Doctors.

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  • #2
    Another consideration is to join the Reserves. Much to say here, but best to discuss with a recruiter. There are bonuses, debt repayment programs and more. I've been a reservist for fourteen years and it is one of the best things I ever done (I'm 64 years old!)


    • #3
      To the author of this article, I think you did a wonderful job on framing the issue. I also agree that choosing the military because you want a free education does not get you any farther ahead financially. The opposite--especially in procedural specialties or current in vogue high paying specialties--is very likely true. Choosing the military must come from some desire (or, as KFM pointed out in the original posts, at least some general interest) in service.

      The recruiters are going to throw a lot of very good looking numbers at prospective HPSP or USUHS candidates. Medical students or medical school applicants start hearing things about "stipends" and "books being paid for" and "no student loans", and things start to look pretty good on the front end. I don't believe that someone considering HPSP/USUHS should choose this path without knowing both the good and the bad.

      RE: the points on the original article:

      1. You will be doing a fair amount of stuff that you won't want to do in the military. Maybe it will be mandatory training and briefings that you'll have to do every year during your birth month. Maybe it is hours of online training. Maybe it will be going out into the woods for 3 days, a week, a month, or longer to do field training (think of it like camping in military tents and doing clinic in a different tent or the back of a HMMWV). Maybe it will be you being assigned to a small hospital with little volume for you to practice your specialty or subspecialty to the fullest. Maybe it is losing clinical skills after training because of this. Maybe it is a deployment overseas for 3-, 6-, 12-months, or longer. Maybe the deployment is to a well established airbase with air conditioned buildings and Wi-Fi. Maybe it will be to an immature theater of operations where you have to sleep with a mosquito net every night. There are lots of duties and responsibilities that come with being in the military. At the end of the day, it really comes down to whether or not you are okay with surrendering your right to choose. As a civilian, you can choose where to work, what kind of specialty to train in, how you want to structure your practice, and where to live. Most of these choices will be truncated to a small list ("You're the only cardiologist in the Air Force available to move this summer so you need to rank order these places to live in as your next assignment: Washington DC; San Antonio, TX; or Datyon, OH. Get this list back to me by the end of the week."), or you won't have the choice at all. After my intern year, I was assigned as a General Practitioner at a rural military base. The military asked me to rank order 16 locations that were available that summer. After I submitted my list, I was told that I was the only person currently trained as a flight crew member, so I would be assigned to subsequent assignment even though it was ranked 12th out of my 16 locations. When asked why I was being assigned to a place so low on my rank list, I was told that the military needed a doctor at this base very soon, and I had to go. If I said no, too bad. I was going to be assigned there anyways. Now, this location turned out to be a great assignment, and I really enjoyed my work. However, if you don't have a "bloom where you are planted" mentality, if you must be within a certain geographic area to be near family, or if you are not okay with subordinating your desires to the greater good of the military's larger needs, you will be in for a very bitter season of your life.

      #2: On sacrifice, you certainly will make less than your civilian peers after training especially if they go into a high paying specialty. With a quick google search, you can find what the MGMA average pay is from a few years ago (such as this link here: for your projected specialty. You can compare this to military pay by using various table or calculators as I demonstrate below using me as an example:

      O-4 base pay (10 years of service): $7684.20
      Basic allowance for subsistence (BAS): $266.18
      Basic allowance for housing (BAH; this varies based on duty location zip code and if you have dependents. My current BAH is listed): $2100.00
      Medical specialty pay: $4916.66
      Board certification pay: $500
      Total monthly pay = $15,467.04 (pre-tax)

      There are ways to increase these numbers some. For example, if you agree to sign a contract to extend the time you owe by 2-, 3-, 4-, or 6 years, the medical specialty pay for my specialty would increase to $9,083.33, $10,333.33, $14,666.66, and $16,750, respectively for the years encompassed by the additional contract. To clarify, if you sign up for contract extension, you will be paid these higher rates only during the 2-, 3-, 4-, or 6 years you additionally sign on for. Once you no longer are under the additional time, you revert back to the previous pay scale for your medical specialty.

      The average pay in 2018 per the MGMA data for my region in my specialty was $552,446 meaning my monthly take home pay would be $46,037 pre-tax. If I was able to spend a few years under the maximal pay allowed by current bonuses, I would be making $27,300.38. This is 59% of the median pay of my civilian peers. However, based on contracts I signed for undergraduate, medical school, residency training, and civilian sponsored fellowship training, I will have served past 20 years. As such, I will not be signing a contract extension throughout my time in service. Thus, I will likely be paid at the same rate I am currently at with minor increases (around $1000 with each promotion or a few hundred dollars every two years) for the remainder of my military career. This means I will be making 33% of my civilian peers for my entire term of service.

      To compare the opportunity cost, let’s assume that I and a medical student peer go into the same specialty and subspecialty after medical school, and let’s see where we end up at over 20 years. Say they graduate from residency and fellowship with no sizeable assets and $400,000 in student loan debt. They then work for 14 years at the MGMA average rate earning a total of $7,734,216 at the end of 20 years. Subtract $400K for student loans, and you are left with $7.3M in earnings at the 20-year mark after medical school with some additional interest paid and interest made.

      Let us assume I graduate medical school and commission as an officer. Also, I get promoted on the typical physician timeline (once every six years with my year group: O-3 for 6 years, O-4 for 6 years, O-5 for 6 years, and an O-6 for 2 years). I sign no additional service contracts, and I live in my current duty station zip code. I will have made $3,289,624 in the same 20-year period as my classmate. $400K in sunk costs to be ahead $4.4M to graduate from medical school as a civilian certainly doesn’t seem as appealing as losing that same $4.4M in opportunity costs just to be debt free. Why not pay interest on $400K for a few years while living like a resident instead of taking the $4.4M opportunity cost over the first 14 years of my career after GME training?

      While this math is for tailored to me, anyone can do this math based on their chosen specialty by looking up the following data: Base pay (, BAS (, BAH calculator (, medical specialty pay (, and other bonuses (

      Feel free to run the numbers for your geographic area, specialty choice, and look at the opportunity costs that come from military service. The TL;DR here is that financially it makes more sense to do civilian medicine and not do military service for the vast majority of specialties. And this includes the military retirement plan. This pension as it is currently structured is 40% of the average of your base pay over the last three years of service. For this example, that is $4,092.64 / month for the rest of your life. If my medical student friend and I both stop working at 20 years, my retirement will only take 35 years to break even with the $4.4M in opportunity costs lost by military service.


      • #4
        #3. I mentioned that one of the biggest sacrifices that you and your family will make during your time in service is the freedom of choice. One of those choices may very well be the decision to train in something that you may want to do. The Armed Services are focused on trimming costs and making the Force lethal and having service members who are able to do their wartime jobs. This has also applied to the medical system as well. As an example, say you want to be a radiation oncologist. The Army was the only service with any of these physicians on active duty a few years ago. However, with the pivot to lethality, the Armed Services did an analysis to see what medical specialties lacked a wartime relevant job. Radiation oncology was one of those specialties that lacks wartime relevance. As such, the military is no longer training radiation oncologists, and they will not train these physicians going forward for the foreseeable future. So, if you want to be a radiation oncologist, you will not be able to train in this as a military physician. That said, the military is front loading many wartime relevant specialties with additional training slots and funding. Wartime relevant specialties include general surgery, trauma surgery, critical care, neurosurgery, orthopedic surgery, anesthesia, emergency medicine, psychiatry, family practice, and internal medicine. If you want to train in one of these, there will likely be a training spot available if you are an otherwise competitive candidate in that year’s application cycle. But, if you want to do pediatric endocrinology, breast radiology, neonatology, maternal-fetal medicine, gastroenterology, or allergy/immunology, I think you will have a hard time getting the military to fund this training as they lack relevance—at scale—in a combat theater of operations. When thinking about what you want to train in, think war surgery and non-subspecialty trained primary care as desirable training specialties. If you need proof of what the military needs, just follow the money. Here are the bonuses offered to fully trained specialists. I think you can see a trend line for the kind of physicians the military needs: I’m not saying that you will never train in a particular specialty or subspecialty that you may want in the military (maybe with the exception of radiation oncology). But, I do think it will be a hard row to hoe to get to be a otorhinolaryngologist subspecialist installing cochlear implants in the military if that is what you feel called to do.

        #4. While I agree that the military retirement plan is nice, has good benefits, and provides an annuity-like pension for life, the $4.4M in opportunity cost above invested in the “VSTAX and chill” model would generate $486,640 in interest a year assuming a 11.06% annual return based on the 15-year average returns quoted on Morningstar I pulled today ( Sure, some years would be less than 11%, but so long as it was 3.03% or greater for the year, you’d earn more on interest per year from the $4.4M invested in nothing other than VSTAX rather than the military pension on an annual basis.

        #5. No comment. I haven’t participated in any of those programs, but the margins may be better with those programs than HPSP/USUHS.

        Bottom line: should you apply for HPSP/USUHS? Honestly, yeah, you may want to. I say that because we spend so much time in medicine getting burned out doing work we hate. Serving in the military allows you to take care of some of the greatest, most selfless people in the world. Serving allows you to give back to our national community in ways that other people have no clue about. Being able to wear the uniform and know that you are shouldering the burden carried by generations before for the cause of freedom and preserving the protections that Americans enjoy every single day by your selfless service to the nation is humbling. There are more concrete things that come out of this as well. Ever wanted to see the Northern Lights under night vision goggles flying over the Arctic tundra in the dead of winter in a CH-47 Chinook? That was a pretty cool memory I have. Want to live overseas in Europe or Asia? Definitely an amazing opportunity to be had there, and one I've enjoyed off and on over the years. Want to go on a grand adventure, play with military equipment, and provide medical care in austere environments with nothing other than what fits in a backpack and whatever is rattling around on the floorboards of an HMMWV? Military medicine provides unique opportunities to practice your craft in environments that our civilian peers can only dream of.

        This really comes down to whether you feel called to a term of service. If you feel like you *must* serve, well then you simply *must* serve. However, if you don’t see the appeal of the experiences above, if you could go either way on the public service route, or you are only doing this for the upfront security that comes from the contract, I wager you may find yourself feeling disappointed during your term of service by cumbersome administrative requirements; long deployments away from family; lack of a broad, high volume practice in a specialty that you want; assignment at duty stations that you hate; headaches that come from passing physical fitness tests; and silly things like mandatory military education courses that take you out of clinical practice for weeks or months at a time (ask any Army officer about Captain's Career Course, Intermediate Level Education, or the Army War College and the headaches that come from having to take these courses).

        Humbly, I would submit that if you *must* be a military physician as your life would feel incomplete *NOT* serving, then you *must* serve. If, however, you don’t feel some exceptional reason to serve, then I think you would likely prefer deferring service.


        PS: As a brief aside, in reference to O.D.D's comments on the original article, I do feel like great strides have been taken in the military to grow the organization ethically and with regards to promotion from the 1970s. Promotion rates are equivocal across the military medical department. Everyone (95+% of each year group) promotes at the same time and same rate regardless. While I certainly would not suggest that the military is free from bias, racism, sexism, or any of the other more deplorable problems that plague our society, it certainly has improved from the military of the previous century. This is in no way to devalue her claims or comments about her lived experience; rather, it is to acknowledge that significant strides have been made, and this is certainly a much smaller problem in our current military than previously while acknowledging that we as a military and society as a whole have a long way to go to improve.


        • #5
          Couple things left out (some related to retirement, some not).
          Medical care. Tricare costs us $700/year. For the entire family. We have no issues with it. I route my meds through the VA so they are free rather than the 7.00 copay with tricare. All those posts on this forum about "how are you going to pay for medical care if you FIRE?'"...ya I just scroll by....
          Homesteading tax perks. Our home assessed value is decreased 60K because we are veterans (then we get a homestead on top of that for another 30k). That is annual tax savings to lower your home assessed value by 100K.
          Countless discounts. All big ticket items we pay no tax. Great way to buy designer purses and diamond jewelry with no tax!
          GI bill/post-911 GI bill for yourself or dependents if transferred.
          subsidized child care. I was paying less than $500/month for fabulous child care with great hours.
          burial costs
          hiring edge. I do believe the military experience on a CV gives an edge over other candidates for jobs. Statistics have supported that as well via employer survey data.


          • #6
            It’s a great deal for those wanting to do primary care and who don’t mind the bureaucracy and moving around. For everyone else you better have a [email protected] good idea of what you’re getting into and do it for the right reasons (service).