How to Pay for Medical School

There’s no doubt in anyone’s mind that affording the education required to become a physician is a daunting task. On top of the escalating costs of an undergraduate degree, if you want to go to medical school, you’ll have to figure out how to pay for medical school. It’s a serious financial commitment.

According to the Association of American Medical Colleges, or AAMC, the average debt for graduating medical students in 2020 was $207,000.

Or, if you prefer to think of it in yearly terms, the tuition, fees, and health insurance for a first-year med school student in 2020-2021 averaged $41,438 for an in-state public institution. That figure rose to $61,490 per year if attending a private in-state school.

Even if you happen to have millions of dollars at your disposal (congratulations), you might still want to consider student loans for your medical school degree. Certain fields and specialties of medical study might earn you forgiveness on those student loans which lessens the overall cost of your education as a practicing physician.

If you’re committed to a career in a medical field, here are some of the savviest ways to finance your education.

Apply for federal student loans

When determining how to pay for medical school, it’s important to consider federal aid. The federal government has money that’s intended to help you pursue your career goals through furthering your education, and medical students are certainly worthy recipients.

Let’s face it — most people don’t have the money to pay for a complete medical degree, free and clear. You’ll have to find alternatives, which often means borrowing a significant portion of the cost.

The federal student loan program is such a valuable resource for people pursuing medical careers, and offers significant benefits compared to private student loans.

Complete your Free Application for Federal Student Aid (FAFSA) when preparing to apply to medical schools. This application is what helps the government determine your eligibility for financial aid, including federal loans.

We’ll get to private loans later, but for now keep in mind that federal Direct Loans typically are more advantageous in terms of flexible, post-graduation repayment options and lower, fixed interest rates.

Here are the primary types of federal loans available to medical students:

  • Unsubsidized Direct Loans. These are low-interest loans and aren’t dependent on financial need. Interest will accrue on these loans while you’re enrolled in school.
  • Direct PLUS Loans. Direct PLUS loans also accrue interest upon disbursement and can help medical students cover some expenses not paid for by other financial assistance.

When deciding how to pay for medical school, keep in mind that federal loans include a lot of protections you don’t get with private loans, like:

  • Flexible repayment terms.
  • Income-driven repayment plans to adjust payments with your income.
  • Options for grace, deferment or forbearance in times of financial hardship.
  • Interest rates are fixed once the loans are disbursed
  • Loan forgiveness options through PSLF and other programs.

Federal student loans for medical school are a low-risk way to finance your medical degree. You have a wealth of options available to you in case of low income for the first few years out of school, such as payments based on your income or additional deferment periods. Plus, federal forgiveness programs are only available for federal loans, not private loans.

Consider private student loans, if appropriate

Private student loans make sense for certain students, but it’s important to recognize some key differences and decide how they would work for you.

Private student loans should be a last resort when paying for medical school. They can come with higher — typically variable — interest rates, and private lenders don’t have generous forbearance or income-driven repayment options.

If you plan on opening up your own practice one day rather than working for a nonprofit medical facility, then borrowing from a private lender might be the right choice for you. Working for yourself or another institution that isn’t qualified for Public Service Loan Forgiveness (PSLF) is one reason to take out private loans.

However, it’s essential to think through your options before relying solely on private loans.

If you’re not eligible for any federal aid to pay for medical school, then private loans definitely can be beneficial. You might still find a loan that has a lower interest rate, compared to federal loans. Private loans are a way to bridge any gaps in funding after exhausting all of your other financial aid sources, including federal loans and scholarships.

Local or institutional scholarships

Certain medical schools actually foot the bill for your M.D. More commonly, medical schools and other organizations may award local scholarships and grants to deserving medical students. The more local the opportunity, the less competition you might face from other candidates.

Applying for multiple scholarships as well as federal financial aid can give you the best odds of minimizing your medical school debt. Pay attention to the descriptions of each award you apply for — some may award full tuition, while others may say “full-ride” and comprise other aspects such as mandatory fees.

Take a glance at these medical schools and programs that pay full or partial tuition for medical students. If you easily meet the eligibility requirements, consider moving forward with an application.

New York University’s Grossman School of Medicine

For someone who can get accepted into the NYU Grossman School of Medicine, the cost won’t be the biggest challenge of earning your degree. This institution actually pays full tuition for all of its MD students, and that’s not dependent on financial need or merit. In order to keep the scholarship, you must meet all of the school’s academic progress guidelines.

Kaiser Permanente Bernard J. Tyson School of Medicine

At this California school, Kaiser Permanente Bernard J. Tyson School of Medicine, the first five classes of new medical students will not pay tuition or fees. For all students beginning in the fall of 2020 through fall of 2024, the college is waiving all tuition and fees for all four years of enrollment. Tuition, fees, and health insurance through Kaiser Permanente are covered.

While this is an amazing offer, remember that this school doesn’t cover living expenses like housing, transportation, and meals, which can be pricey. The waived fees are estimated at $54,719 per year for tuition and fees plus $6,538 for health coverage.

Cleveland Clinic, Lerner College of Medicine

Case Western Reserve University School of Medicine offers a new program via the Cleveland Clinic Lerner College of Medicine (CCLCM). Each class admits a maximum of 32 students, and each one receives a full tuition to complete the five-year curriculum.

This specialized program focuses on clinical work and scientific inquiry, and graduates receive an MD degree with Special Qualification in Biomedical Research.

Physicians of Tomorrow

The American Medical Association (AMA) Foundation awards $10,000 tuition assistance scholarships to medical students nearing their final year of medical school. AMA membership is not required for eligibility for the Physicians of Tomorrow scholarship.

Tylenol Future Care Scholarship

The Tylenol Future Care Scholarship offers $5,000 and $10,000 scholarships to students pursuing health care professions. This is a one-time, non-renewable award. Ten $10,000 scholarships and 25 scholarships for $5,000 are available as of the 2021-2022 academic year. Enrollment at a medical school, nursing or pharmacy degree program is acceptable.

At certain medical colleges, students may be able to receive significant funding towards tuition and fees in exchange for promising their services in some format. These are often geared towards students seeking degrees or medical specialties that traditionally pay less than the most lucrative areas.

Here are just a few of the best-known medical school scholarship programs:

National Health Service Corps Scholarship Program

The National Health Service Corps Scholarship Program (NHSC SP) offers a robust medical school financial aid program for those willing to commit to two years of full-time service following graduation. If you’re studying an eligible primary care health profession, you can apply for this scholarship.

The NHSC scholarship is worth full tuition as well as a stipend for living expenses, and the maximum amount of financial coverage is four years of education. After completing your training, you must serve at least two years in a site approved by the NHSC in an area deemed a Health Professional Shortage Area, or HPSA.

Abigail Geisinger Scholars Program

For students at the Geisinger Commonwealth School of Medicine in Pennsylvania, receiving the Abigail Geisinger Scholars Program award is a great way to pay for medical school without going into debt.

The Abigail Geisinger Scholars Program pays four years of tuition, required fees, and a $2,000 monthly stipend. The length of service commitment matches the length of years of tuition, so to receive four full years of funding, you’d commit to four years of service at a Geisinger-employed physician.

You must pursue a specialty of one of the following areas of need: family medicine, internal medicine, medicine-pediatrics or psychiatry. Candidates are selected on the basis of financial need, merit, and diversity. The selection committee also considers your likelihood of remaining employed with Geisinger after completion of your service commitment.

St. George University scholarships

St. George University, located in the West Indies, offers 16 different scholarships and grants for medical school students. For example, the Health Professions Grant is worth up to $10,000 for healthcare professionals enrolling in the four-year MD program. There’s also a Veteran Grant for a maximum of $20,000 for the same program.

Other options at SGU include the Chancellor’s Circle Legacy of Excellence Scholarship (CCLOE) which provides up to $94,500 for students in the four-year MD program. To qualify, you need a minimum 3.7 undergraduate GPA, a 3.5 Science GPA, plus an MCAT score of 506 (29 on the former scale).

F. Edward Hébert School of Medicine

The  F. Edward Hébert School of Medicine is a part of the Uniformed Services University of the Health Sciences, or USUHS. It was established in 1972 to ensure that U.S. military branches would have plenty of trained physician-leaders. If receiving a tuition-free medical education for the purpose of “Learning to Care for Those in Harm’s Way” appeals to you, this may be the medical school for you.

Part of the deal for this M.D. program is committing to seven years of active service after graduation if you’re in the Army, Navy, or Air Force. Those who select Public Health Service must serve for ten years.

Paul and Daisy Soros Fellowships for New Americans

Created to support immigrants and the children of immigrants, the Paul and Daisy Soros Fellowships began in 1998. Potential to contribute to U.S. society, culture, or your academic field is a requirement along with being an immigrant or child of an immigrant. Each year the organization awards 30 fellowships worth up to $90,000 over two years.

Diverse Medical Scholars Program

The United Health Foundation together with National Medical Fellowships provide the Diverse Medical Scholars Program. The aim of the program is to increase the number of quality physicians in medically underserved communities.

Scholars receive $7,000 annually, and the award is available for second- through fourth-year medical students. A stipulation of the award is completion of a 200-hour self-directed community health project and subsequent oral and visual presentation.

Paying for medical school

Medical school involves a huge commitment of both your time and your money. The scholarships and funding opportunities included here are not the only options available for students pursuing medical degrees. If you’re just starting your medical training path, consider getting some expert advice by booking a Student Loan Planner pre-debt consult.

Before taking on potentially six figures of educational debt, it’s worth spending a little time on planning out your strategy. Our experts have consulted with clients on hundreds of millions of student debt, helping people avoid pitfalls ahead of time and save money in the long run.

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