The Coming Medical School Bust

Lower-tier law schools are in trouble. The latest saga is at Valparaiso, which faced a conundrum of whether to lower admissions standards to keep enrollment up, or maintain standards and suffer from falling revenue. Soon, we may be reading about the same thing for medical schools.

The Association of American Medical Colleges predicts that medical school enrollment will increase by 30% by 2019. But, suppose they are wrong? Suppose new business models make the physician shortage a myth?

The issues sound familiar:

1. Larger and larger student debt that may take an entire lifetime to pay off.

2. A job market that is shrinking due to macroeconomic forces and the threat of substitutes, such as technology, robomedicine, and non-MD providers.

3. Adherence to an academic medical center model that is not suitable for most schools, given shrinking and vacillating basic science research funding, dwindling state support for higher education, and dropping reimbursement for the clinical cash cow.

4. Tenure policies that are no longer economically feasible.

5. A business model that is broken.

6. A PhD and post doc system that creates more and more student debt with limited academic tenure track possibilities.

7. The changing sick-care landscape demanding graduates with knowledge, skills, and attitudes that medical schools refuse to teach

8. Online teaching technologies that make non-clinical face-to-face lectures and memorization, and the basic science faculty who teach them, increasingly irrelevant.

9. The potential collapse of the employed physician market with limited opportunities or desire to participate in independent clinical practice.

10. An aging and more heterogeneous physician workforce full of people who refuse to retire.

Premeds, medical students, and trainees should plan for a worst-case scenario. Just like there are many non-practicing lawyer opportunities for those with a JD degree, there will be many non-clinical practice opportunities for those with an MD degree. You should plan and borrow accordingly.