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Being a Military Doctor – Podcast #92

Podcast #92 Show notes: Being a Military Doctor

Disability Insurance
When I recorded the introduction in the podcast for this episode’s guest it was pretty lengthy. But when you have done a lot, you get a long introduction. And Commander Joel Schofer has done a lot. He is an MD, board certified emergency physician, with an MBA, and currently serves as the associate director for healthcare business and has served for the last three years as the Navy Emergency Medicine specialty leader. This is a rather prestigious position. You are basically in charge of all the other emergency docs in that service. I think all those credentials are pretty important when we get into the specific subjects in this episode. Joel is also a prolific blogger. He blogged previously at Military Millions but has moved on to mccareer.org where he focuses on careers for military and medical core physicians. Basically if you have any questions about military medicine, especially in the Navy, Dr. Schofer is the man with the answers. I’ve been out of the military for several years. It is nice to have someone watching me and correcting me when I make the inevitable errors about military medicine. Dr. Schofer has been doing that for me over the last year or two. Every time I screw something up with the military, he shoots me an email and I’m able to correct it, so I appreciate that. We delve into the best way to join the military as a physician, the military match for residency, the new retirement system, the best and worst things about practicing medicine in the military, and more. But remember that the views Dr. Schofer expresses in this podcast are his own and don’t necessarily reflect the official policy or position of the Department of the Navy, Department of Defense or the United States government. Now with that disclaimer out of the way, let’s get into the episode!

Disability Insurance

This episode is sponsored by Bob Bhayani at Doctor Disability Quotes.com . They are a truly independent provider of disability insurance planning solutions to the medical community nation wide. Bob specializes in working with residents and fellows early in their careers to set up sound financial and insurance strategies. Contact Bob today by email at [email protected] or by calling 973-771-9100.

Quote of the Day

Our quote of the day today is from Morgan Housel who said,

“The simple idea that most people wake up in the morning trying to make things a little better and more productive than wake up looking to cause trouble is the foundation of optimism. It’s not complicated. It’s not guaranteed, either. It’s just the most reasonable bet for most people.”

I agree with that. We have a very optimistic person on the podcast today.

Military Doctors

Joining the Military

What should be the primary considerations for a student or a doctor that is considering becoming a military doctor?

We both definitely think it shouldn’t be finances, even with the cost of medical school nowadays. Only join the military if you want to be in the military. If you attend USUHS, the Uniformed Services University of the Health Sciences, the military medical school, you’re talking about a seven year commitment. That can be a long time. Most people who go there know they are going to be sticking around for 20.

The HSPS scholarship, which both Dr. Schofer and I used, has a commitment depending on how long your training is, usually three-five years. I went to the University of Utah. Tuition was 10 grand the year I started. Everyone came out with loans at 1%. Then I ended up in a relatively high paying specialty, and so the numbers didn’t work out well for me joining the military. That certainly wasn’t the primary motivation of doing it. I had a lot of great experiences I couldn’t have anywhere else while I was in the military, but number-wise, I definitely came out behind having the military pay for my medical school. Dr. Schofer and his wife went to MCP Hahnemann, which was one of the most expensive medical schools in the country. They probably had $500,000 of debt they avoided by both getting the Navy scholarship so it worked out well for his wife and him.

We discuss reasons people might go into the military:

  1. Money. I’m sure that’s at least partially motivating to some people.
  2. If you want to see the world on the taxpayer’s dollar.
  3. You have family history of military service.

We discuss the different ways into the military for a physician:

  1. Attending the Uniformed Services School.
  2. Go through HPSP, Health Profession Scholarship Program where they basically pay for medical school.
  3. Go through the FAP program where you join as a resident or even come in as an attending and often get some sort of a signing bonus.

I asked Joel what he thought is the best way in and what are the pluses and minuses of each of the various methods?

USUHS

“Unless you’re really committed to a career in the military, USUHS with its seven-year obligation, might not be the best. You’re wearing a uniform, going to a military medical school, and getting paid. Your time in medical school will count toward retirement at the end. So if you hit 20 and then you retire, you get credit for 24.”

HSPS

“When it comes to HPSP,  you’re getting a stipend and a signing bonus. You’re not getting full active duty instant pay like somebody at USUHS, but you’re in a civilian med school and you’re not wearing a uniform. Your commitment is less. Usually, three or four years depending on how many years you get the scholarship for.”

FAP

“The FAP program is interesting, because if you do HPSP or USUHS, you could train in the military. That military time, if you’re training full time in service, will count toward retirement. It counts toward your 20 years you need to get to. If you do the FAP program, you’re in a civilian residency already. That time is not going to count.

Let’s say you do a three-year emergency medicine residency. You sign up for the FAP program and you get that extra pay while you’re a resident. You’re going to come on active duty. You’re going to have only three years you owe and you’re going to hit your decision point that you can get out with only three years toward a 20 year military commitment.

I did HPSP and because of my residency and my fellowship I hit that decision point at 10, so I was already halfway toward a 20-year retirement. If I had done USUHS, I would have been so close to 20 before I even had that decision to get out.

I think it just depends on your commitment to the military. You want to get your money and get your experience and you’re leaning toward getting out. The FAP program would be great. You think you’re in for 20 years for sure? Then USUHS would be great and the HPSP is probably a good compromise between those two extremes.”

Joining the Military as an Attending

Is it easy to join the military as an attending?

“Honestly, it’s a hard question to answer, because people will contact me and they say, “Hey, I’m an ER doctor. I want to come into the Navy.” You’d think that would be easy, but you have to pass the physical standards. You have to contact your recruiter. It’s just kind of a black hole. I would direct people to the recruiters. It was very rare that I ever heard from anybody again. The ratio of people that are interested to the people that actually wind up showing up one day, it definitely is not a high percentage of success there.”

My take on these different routes into the military is that USUHS seems to be the best route for somebody that wants to make a whole career of it. Not only do you get that extra payment at the end, but also you are in the military from day one and getting paid like it. HPSP seems like a better way for somebody who wants a taste of the military. They want to be in it for four years at the beginning of their career, have an adventure and then go on and have a civilian career.
Then FAP seemed like it was the best way to get in if you were interested in avoiding going through the military match because you sign on with the military after the match is done. Then part of it might just be when they decide they want to go into the military. If it’s too late to apply to USUHS, you can’t go there. If you’re already out of med school, you can’t do HPSP, so FAP is the only option.

Military Match

What’s the secret to navigating the military match successfully?

You can read a post Joel wrote giving tips to matching in the military. He has been involved in four military matches on the Navy side of things. You are in a much smaller applicant pool and it can be harder to match.  Number one is you have to be realistic about your chances of matching in the specialty you’re trying to match in. It’s actually harder to match in Navy emergency medicine than it is to match in general emergency medicine, even though general emergency medicine is extremely competitive. The biggest downside to the military match is that if you wind up not getting what you want, the military is going to find a job for you. You could wind up being a transitional intern or an internal medicine intern or any kind of intern even if it isn’t the one you wanted, because you’re on active duty and you need a job. That uncertainty can definitely frustrate some people.

I remember the year I applied in the Air Force. There were about 50 of us that want to do emergency medicine. I think there were about 15 active duty spots and about 10 deferrals into the civilian match. The match rate that year was literally 50% into emergency medicine in the Air Force. I think emergency medicine that year was like 93% in the civilian match. People that wanted to do emergency medicine got to do it. It was dramatically more competitive in the military.

On the flip side, I know of at least one doctor who wanted to be a dermatologist. He had spent some time as a family practice doctor and then came back and applied to do dermatology and it was dramatically easier to match into dermatology in the military that year than it was in the civilian world. So it goes both ways, depending on how many applicants there are. In some of the specialties where on the outside they would be really competitive, there might not be a whole lot of training programs in the military and then one year there might just not be a whole lot of applicants, so you may luck out.

Training in the Military

Do you have any tips for maximizing the quality of your training if you have a military commitment?

“I personally think that the military programs across the board are excellent, but I’m also probably biased because I trained in them. There was an article that recently came out this week that showed that they were looking at general surgery programs at an Army hospital which was ranked number one of more than 200 programs in general surgery of the percentage of their graduates that passed their boards the first time around. Something like 97% or 98% first-time pass rate. The article is saying if you’re in the 89th percentile on your in-service training exam, you’re at the bottom of your class.

In the military you’re going to be surrounded by people that are a little more regimented, oftentimes older and more mature because a lot of people in the Navy at least wind up doing general medical officer or GMO, flight surgery or undersea medical officer tour, so they’re a little older. It is just a more motivated bunch. You’re still going to see the sick patients. You’re still going to get all the training you need, all the programs are accredited, so it’s still going to get you to the same place, board-certified in whatever specialty you want to be.

Compared to the civilian, there’s also some experiences in the civilian world you’re just not going to get in the military. For emergency physicians, if you want to crack chests every day, it is not happening here. It will happen in 40% or 50% of your out service rotations that you’re doing in civilian hospitals. You have to do outside rotations to get the mix and the patient acuity that you need. If you want to crack chests every day you’re going to want to do a civilian deferment. I think the academic programs and the teaching in the military programs are excellent. I did a fellowship at a very highly regarded civilian residency program, and I just think the education and the quality of the residents is superb in the military when compared to the civilian world.”

 

I have a bias as well as a faculty member for a military residency program. The residents were always very sharp academically. There is a big focus for sure on doing well on board exams. They like being able to say, “Hey, we’re number one of all programs.” I think there’s a little bit of a chip on the shoulder of most military residency programs. The problem was that they were taking care of a very healthy population. They don’t have a lot of terrible diseases, and so in a specialty like general surgery or emergency medicine or critical care, the pathology in the actual military medical center was going to be lower than what it might be in a comparable civilian center.

I think the way most programs deal with that issue, lower numbers of procedures and a little bit less pathology, is by doing a lot of rotations outside the military. Is that adequate to make up for that loss of pathology and procedures?

Dr. Schofer thinks so.

“We all have to meet the ACGME requirements whether you’re a military program or civilian.  I thought it was great to go out into a civilian hospital and take care of the sickest of the sick for two or three months and then come back and take a little breath and refocus on academics and then jump back into the fray a couple months later. I really think if you gave me one medical student and I had to make them the best physician in any specialty and I had a choice, civilian or military, I’d go military because I just think they’re going to be better.”

 

Getting the Assignment You Want

Do you have any tips for a doc coming out of residency to get the assignment they want?

I will tell my story when I came out of residency. It was interesting. I was in a civilian residency. I had gotten a civilian deferment out of the match. I had no military experience whatsoever. I find out from a letter that I need to submit some kind of a rank list of all the places that Air Force emergency doctors can be sent. My wife and I stewed about it and we went back and forth, and we prayed about it and we came up with this list in the order of where we’d like to go. A couple of weeks later after we sent that in, I get a call saying, “Hey, we’ve got you penciled in for Keesler.”  Keesler was number 15 on my list. My thoughts were why did I make the rank list? What’s the point of making it if I just go to number 15 on it? In the end, a spot opened up at Langley and we jumped at that opportunity.  It actually worked out fine because I worked most of my shifts with the Navy which was pretty fun.

Joel, who as a detailer who assigned all sort of specialties and then as specialty leader assigning people for five years, had this response:

“I think across the board, you have to realize when you’re a new grad out of residency, like you experienced, you’re at the bottom of the barrel. People who are overseas and want to come back, people who have gone operational, deployed, people who are senior to you. It takes a little while for you to rise up to the level where you are going to get the pick of the litter.”

I would also encourage people to always just be honest. The military is full of honest people and we all talk. There are people who would try to play their specialty leader off of me when I was the detailer. Play dad against mom. Well, dad and mom talk. The military is about people, so you want to treat people nicely and don’t play games.

When you’re junior, most of the time, you’re going to get what no one else wants. But to be honest with you now, at least in the Navy Emergency Medicine, we do a match. We use the ACGME matching algorithm and it is literally an algorithm. It’s not really about seniority. All the places that have spots submit a rank list and then you submit your rank list just like you did and it gets run through the algorithm, and that’s where you go. We found a fairly transparent and fair way to do it, at least in my specialty, that people seem to like.”

Happy Doctors in the Military

What percentage of doctors are happy in the military?

Joel thought there was probably a third who can’t wait to get out, a third pretty neutral, and a third that love it. The most unhappy people are the people that pick a service that doesn’t align with what they like. They don’t like to camp and they join the Army. They can’t swim and they join the Navy. Or they sign up for the military just purely for the money. They don’t want anything to do with the military.

In my experience, I think the Air Force attracted a higher percentage of doctors who did it for the money. I found as a general rule, having worked basically in the Navy and in the Air Force that the Navy doctors were happier with their choice to join the military. I never really understood exactly why that was.
I think it was not necessarily that the Air Force was treating people particularly badly while they were in. I think it was that the people selected themselves that way and people who are more likely to be happy as military docs join the Navy or the Army and not the Air Force, but I don’t know that my experience is generalizable.

I hear lots of discussions and worrying among medical students and residents about GMO tours so I asked Dr. Schofer about that. He said,

“I’ve been in the Navy 17 and a half years and I think for 17 and a half years, they’ve been getting rid of the GMO tour. People probably don’t even know what it is, but you basically do your internship and then you go spend some time as a GP. You’re basically a primary care physician for a bunch of healthy people on a ship or with the Marines in whatever setting. Sometimes you’re even in a clinic. You get a little extra pay. You definitely get a lot of experience. You oftentimes feel like you’re over your head because you’ve only had internship. Very rarely do people complain about it once they get into it. You get the pay. Their life is pretty good. They get experience. They get a little bonus when they come back and apply to the GME match. The military match rewards those who have gone out and done their time. It’s very rare that people complain about it. There are a lot of people that just want to do their straight through training and then, like I said, the Navy is talking about getting rid of that forever, because the Army and the Air Force don’t do a lot of this. We’re a little unique in the Navy with respect to that.”

Best and Worst about Being a Military Doctor

Dr. Schofer said the best part is being able to serve his country and take care of some of the best patients in the world. Although oftentimes they are not as sick as some of us would like, they are part of the 1% or less that have worn the uniform, and it’s an honor to take care of them.

The worst part? Online training. The solution to every problem in the military is to create online training and make you do it.  You’re a board certified emergency physician and you have to do online training about the flu shot.

 

Disability Insurance for a Military Doctor

Dr. Schofer wrote a guest post about disability insurance for military physicians. The bottom line is you have to realize that if you’re a highly paid professional in the military, the military’s disability insurance coverage if something would happen to you, is not going to compensate you like you’re a physician.

It is very hard to get disability insurance as an active duty physician. Insurance companies don’t want to insure people that go to war. He was able to get supplemental coverage with the American Medical Association group coverage. They will give you up to $2500 extra disability insurance a month.

If you really want to get into an individual policy, the best you can get is Lloyds of London, which is pretty expensive, or Mass Mutual. He was able to get an extra $6000 of coverage a month if he was disabled on top of the military. Plus if after five years he was still 100% disabled, he got a lump sum payment of $500,000. Better than what he would have gotten in the Navy if he was disabled and couldn’t practice. Basically, of the big five or six disability insurance companies, you get one of them as a military doctor.

Blended Retirement System in the Military

Starting in 2019 the military retirement system changed. Under the old system, you had to stay in 20 years or you received no Department of Defense contribution to your retirement. All you received was what money you had put into the thrift savings plan, the military’s 401(k) equivalent.

Under the blended retirement system, you will get a DOD match. If you contribute 5%, they’ll match up to 5%. That way, if people leave, they actually leave with some DOD money in their retirement account that they can take with them. It is a much more modern system. But if you do the blended retirement system and you stay in 20 years, your pension gets cut by 20%, because the multiplier under the old system is they take the average of your top three years of your highest pay, and then they multiply it by two and a half percent times the number of years you’ve stayed in.

If you stay in 20 times two and a half, you basically get 50% of your average highest three years of pay. Under the BRS, instead of the multiplier being two and a half percent, it gets cut by 20%, so it is two. You can get 40%. You still get a pension, but all along the way, you got a match of up to 5%.

Among officers, 57% get out before 20 years. The percentage among enlisted is less than 20% stay into 20. The overwhelming majority of people under the old system got nothing toward retirement. It was just whatever they saved. Now, as of 2019, there’s no decision to make any more. You’re just in this new program. But for the last few years, people could choose the new BRS or the old one. But if you signed an HPSP scholarship under the old system and you’re just not on active duty yet because you haven’t graduated from medical school, what he has been told is that anybody in that situation, once they come on active duty even if it’s in 2019 or 2020, they’re going to have a one-time chance to either go with the old system or come under the new BRS. So I asked Joel which you should choose.

He said,

“I think if you plan to make a career out of it, there’s a ton of people that plan to make a career out of it that didn’t. I think if you know you’re just going to do your time and you’re just going to get out, you’ve got to take the blended retirement, because that’s the only way you’re going to leave with any DOD money toward your retirement accounts. If you’re not sure, like we just talked about, the odds say you’re not going to do it, so you should go BRS. If you’re 100% positive you’re going to stay 20 years, my personal opinion is you should stick with the traditional if you have that choice.”

I certainly would have had more money if I had been under the BRS rather than the old system. I imagine if it’s 57% for a typical officer, it’s got to be higher than that for doctors. I think most doctors probably get out. Maybe not so much in the Navy, but certainly in the Air Force. It is a higher percentage than that.

We discussed the reserve pension.  A lot of times, a doctor decides, “I’m going to get out of active duty, but I’m going to go on reserve so that I can get this different pension.” It’s not the same pension, but it’s still an inflation-adjusted government pension that starts at age 60. Joel thought that was a great option, not necessarily just because of the pension but because of Tricare. He felt like if you get out and you can work earning your normal wage as a civilian physician, you will probably earn more money than you’d make in the military, then you combine that with the reserve pension that kicks in when you’re 60 and gets you access to Tricare.  That might be the most financially lucrative way to do it. You just get the benefit of both worlds. Your pension will start before 60 if you’ve deployed or been activated, depending on the length of time.

Financial Independence in the Military

Dr. Schofer is financially independent. He can’t get out of the military for another three and a half years, but then when you combine what he has and the pension, he is financially independent as long as he stays in another three and a half years. He thinks it is easier to do that in the military because of the access to Tricare and that people really underestimate the value of the inflation-adjusted pension for the rest of your life.

“The net present value, how much money you have to have now in order to equal a 20-year O5 commander or lieutenant colonel retirement, which really isn’t hard for most physicians to get, is $1.3 million. For a 21-year O6, which is a pretty common Navy captain or colonel, pretty common decision point to get out, that would be his decision point, it’s 1.6 million.

You can’t spend it. You can’t screw it up. As you experience certainly, there’s just tons of ways that doctors, whether it’s buying the doctor house or the doctor car or getting the doctor divorce, can screw up their finances. You just can’t spend or screw up your military pension, although I will admit that if you’re married long enough and you get divorce, they’re entitled to some of it, but it’s just hard to mess up.”

Another big advantage, of course, is that you don’t start out in this huge hole. You don’t have that debt in the beginning of your career from student loans.
I think another advantage in the military is that there is not this expectation of spending that’s quite so high as it is in the civilian world. People know you’re in the military and they know military docs don’t necessarily get paid that much. I think there’s not quite the expectation to have the fancy doctor house and the fancy doctor car and the fancy doctor vacations. Plus you get a lot of things provided for you. You get a lot of tax benefits. You get your allowances. You get free services on base, reduced costs like commissaries, the daycare is cheaper. You don’t have to think about what you are going to wear to work every day.

FIRE is really one of those things that people talk about a lot and they talk about all the changes they’re going to make when they are financially independent, like working less, dropping their night shifts, quitting their job, or going on to another career. In the military, you can’t necessarily change your job just because you’re financially independent. Dr. Schofer said if you stay in and you promote and become a senior leader you do have a lot of say in how things go in your career if it progresses and goes the way you want. You just know that when you hit that 20 or 21 year mark that you have that option. He can get out and do whatever he wants. You can’t FIRE at 10 or 12 years like some of these FIRE folks can, but he will be 46 years old. That’s still retired early.

Moonlighting as a Military Doctor

What tips do you have about how moonlighting should be done in the military?

  1. Make sure you are an independent contractor getting paid on a 1099 instead of the W2, so you have options to open up additional space in tax advantage accounts like a solo 401(k).
  2. In the Navy, you’re not allowed to do more than 16 hours a week. You could do more than that if you’re on leave. Also, in the Navy, you have to be on leave if you’re more than two hours away from your home station.

Roth Options for the Military

Should an attending physician in the military be using the Roth option or the traditional tax deferred option?

The Roth option. There was no Roth option available to me. I think a military doc ought to be going all Roth all the time, kind of like a resident. For a couple of reasons.

  1. You’re in a low tax bracket. A quarter or a third of your income is tax free. It’s an allowance. Plus, you’re probably a resident of a tax-free state if you’re like most people in the military, so you’re not paying any state income taxes.
  2. When you get out, even if you get out without a retirement, you’re going to be making more and in a higher tax bracket. If you get out with a retirement, you’re going to have a pension that fills up all those lower tax brackets.

The Big Rocks

Dr Schofer shares in this episode about how he doesn’t bother doing tax loss harvesting. And we agreed that it isn’t going to change the needle for either of us.  At a certain level of wealth, all these little financial tips that we talk about on blogs and podcasts don’t make a huge difference. The reason why is because you got the big rocks right. You got your income up. You saved a big percentage of it. You invest it in some reasonable way. You kept at it for a couple of decades and now you’re wealthy. It’s really not about the little tricks and tips and a few bucks here and a few bucks there. Sure that might speed the process a little bit, but in reality, getting rich is pretty straight forward. You make a lot of money. You save a big chunk of it. You invest it in some reasonable way and you protect it with some insurance policies, and that’s really all there is to it.

Ending

If you are interested in military medicine I hope that you had some of your questions answered in this episode. If you know someone who is thinking about joining the military, share this podcast with them.

If you have questions, this is a great community to find the answers. Ask in the WCI Forum or in the WCI Facebook group. Or if you want to have your questions answered on the podcast go record them here!

Full Transcription

 

Intro: This is the White Coat Investor Podcast where we help those who wear the white coat get a fair shake on Wall Street. We’ve been helping doctors and other high income professionals stop doing dumb things with their money since 2011. Here’s your host, Dr. Jim Dahle.

Disability Insurance

Jim Dahle: This is White Coat Investor Podcast number 92, being a military physician. This episode is sponsored by Bob Bhayani at drdisabilityquotes.com. They’re a truly independent provider of disability insurance planning solutions to the medical community nationwide. Bob specializes in working with residents and fellows early in their careers to set up sound financial and insurance strategies. Contact Bob today by email at [email protected] or by calling 973-771-9100.

Jim Dahle: I had a nice note sent to me by one of our listeners here about their experience with Bob and how wonderful it was. If you need disability insurance, I think you can feel confident calling him that you’ll get the right policy for you.

Jim Dahle: Speaking of you, thanks for what you do. We have a great guest on today who’s decided to serve his country but in many ways, you’ve decided to serve your country as well and you’re providing the valuable service to your communities and to your family and to the other healthcare professionals in the hospital helping them do their jobs and helping them to accomplish great things, so thank you for that. I know it’s not always easy.

Jim Dahle: Be sure to leave us any questions you may have that you’d like to get answered on the podcast at speakpipe.com/whitecoatinvestor. You basically just record like a 20 or 30 second question. We put it right into the podcast and we’ll answer it on the podcast, so it makes for really nice feature when we get to have a few more voices on the podcast.

Jim Dahle: Our quote of the day today is from Morgan Housel who said, “The simple idea that most people wake up in the morning trying to make things a little better and more productive than wake up looking to cause trouble is the foundation of optimism. It’s not complicated. It’s not guaranteed either. It’s just the most reasonable bet for most people.” I agree with that. We’ve got an optimistic person on the podcast today. Let’s get into our interview.

Jim Dahle: Today on the White Coat Investor Podcast, we’ve got a very special guest here, Commander Joel Schofer is a board certified emergency physician. He’s got a lot of letters behind his name. He’s got an MD, he’s got an MBA, he’s a fellow of the American Academy of Emergency Medicine. He’s currently serving as the associate director for healthcare business and executive officer.

Jim Dahle: He’s a certified physician executive. He’s published over 150 professional publications and helped numerous national estate leadership positions. He’s won tons of national, academic and educational awards and he has an academic appointment at the Uniform Services, Uniform of the Health Sciences.

Jim Dahle: He’s got numerous military decorations including the Combat Action Ribbon, a Defense Meritorious Service Medal, A Meritorious Service Medal and four Navy and Marine Corps Commendation medals. Perhaps most impressively, he has served for three years as the Navy Emergency Medicine specialty leader. For those who have been in the military, I know that this is a rather prestigious position. You’re basically in charge of all the other emergency docs in that service.
Jim Dahle: Joel is also a prolific blogger where he blogs previously on a blog called Military Millions and he’s moved on to mccareer.org where he focuses on careers for military and medical core physicians. Joel, welcome to the podcast.

Dr. Schofer: Hey, thanks Jim. Thanks for having me. Sorry, that was a pretty long introduction.

Jim Dahle: That’s okay. When you’ve done a lot, you get a long introduction, so I was so impressed with it. I felt like it was worth sharing with listeners. I think those credentials are pretty important when we get into the subjects we’re going to be talking about today. You mentioned you have a disclaimer that you want to make sure everybody here, so we’re going to put it right upfront at the beginning if you want to do that now.

Dr. Schofer: Yeah. I just like listeners to note that the views I express in this podcast are mine and don’t necessarily reflect the official policy or position of the Department of the Navy, Department of Defense or the United States government. Thanks.

Jim Dahle: It’s interesting that when you work for the government or really any big institution, they have some strict rules about how you can make money and what you can do with your time off. It’s interesting. We’re recording this in the evening. We do most of our podcast interviews earlier in the day just because it’s more convenient for Cindy, but we’re actually doing this one in the evening just to make sure that everybody knows he’s doing this on his time off.
Jim Dahle: Let’s start with learning a little bit about you. Tell us a little bit about your family and your background growing up.

Dr. Schofer: Okay. Well, I grew up in Southeastern, Pennsylvania, had two brothers. Nobody in my family was involved in medicine. First one to go to medical school that I’m aware of. Did have a military connection. My uncle was in the Navy. Both my grandparents were in the Army, but none of my parents were.
Dr. Schofer: Pretty much stayed in Southeastern PA. I met my wife in college. We went to a small liberal arts college called Ursinus College that’s notable for two things, premed and both of us are physicians, and graduates that marry each other. Interestingly, we both applied for the Navy HPSP scholarship, Health Professions Scholarship, before we even started dating, so kind of interesting.

Jim Dahle: That is a pretty interesting connection. Speaking of which, tell us about your education and your career path so far.

Dr. Schofer: Well, I did med school at what’s now known as Drexel, but at the time was MCP Hahnemann. Then the transitional year internship in San Diego, Naval Medical Center San Diego. Did some time as a general medical officer or a GMO with the Marines and came back and did residency in San Diego. Then did a tour in Okinawa for two years. Okinawa, Japan as a staff attending, but then came back and did a civilian fellowship on the Navy’s Dime at Christiana Care in Delaware, in emergency ultrasound.

Dr. Schofer: I’ve been practicing ever since 2009 after fellowship. Although I’ve moved around a couple of times, but still maintained my privileges and my practice there. I’ve been there for nine years now.

Jim Dahle: We have a really interesting, almost connection here. You want to tell the listeners what our almost connection is?
Dr. Schofer: Yeah. When I showed up after my fellowship, the gave me an office and they told me it was the Air Force office. It was where the people that used to come down from the Air Force Base that practiced in the Navy Emergency Department. The room that they used in their office, I think there were three people and I think you were one of them.

Jim Dahle: Yup, that’s right. He got my office. We were very nearly on the staff at the same time, but about the time the Air Force moved me out of there is when you showed up. It was a great place. I really enjoyed my time there surprisingly. It was interesting because I looked forward to my shifts and dreaded my shifts at Air Force Base while I was in the military, and so it was great to go down there and work with the residents and have that experience down there. Tell us now what you’re doing both clinically and non-clinically?

Dr. Schofer: Well, non-clinically, I mean my career has transitioned. You mentioned I was the emergency medicine specialty leader, what they’d call the consultant in the Air Force with the Army. I just turned that over actually, so it’s a three year tour usually, so I just turned that over about a week ago and starting to move toward executive medicine. I still practice emergency medicine once a week, but spend most of my time, like you mentioned, in the healthcare business realm at the hospital.

Jim Dahle: It sounds like almost a full-time administrator now, is that right?

Dr. Schofer: Yeah. I guess about 80%. I mean four out of the five days of the week, I’m doing administrative stuff. I think some of the things we may get into, that’s one of the things that’s unique about being in the military. I think it really advances your career. Just forces you to move up or get out. That’s what I’ve been aiming for, for probably the latter half of my career, so I’m happy to be where I am and I enjoy it, but I still like seeing patients once a week at least. Going to keep it real.

Jim Dahle: Now, some of our listeners know you for militarymillions.com. What happened there? I understand you shut it down shortly after attending FinCon last fall. Was that decision related to attending there or was it just the timing?

Dr. Schofer: Yeah. I think it was definitely related. I had the other blog, the one I’m still doing mccareer.org, which stands for Medical Corps, mccareer.org, for about four years. I started to get the entrepreneurial bug, and so I wanted to take what I was writing about personal finance and put it on its separate blog. I got militarymillions.com, started it, wrote on it pretty solidly for about a year. I always wanted to go to FinCon. I know you’ve been there.

Dr. Schofer: I went there and it was all about building your business, building your brand and making sure you have a passion for what you’re doing. I’m sure you can relate to this. Running one blog is very time consuming and trying to run two is too much. I was sitting there listening to all these lectures at FinCon. Everybody is inspired with all this incredible excitement for what they’re doing and I started to think, really my passion and what I really like is with the Navy blog. It’s what people know me for. It’s what I’ve been doing for four years.

Dr. Schofer: As we’ll probably talk about, I’m financially independent now and I don’t really need the money from Military Millions if it ever got to the point where it was generating significant revenue. I just decided to give it up and focus on the blog that is much more aligned with the things I like to do.

Jim Dahle: Did you get any pressure whatsoever from the Navy to have a for-profit blog on the side or money blog or anything or is this all just you?

Dr. Schofer: No pressure, but it was very awkward. A lot of the things that I talk about at work are career related and personal finance related. I certainly do most of the personal finance lectures for not only my residence in emergency medicine but also I’ve given them to the entire medical staff.

Dr. Schofer: I couldn’t talk about a for-profit blog. Just imagine you’re giving finance talks but you can’t mention the White Coat Investor. Not that Military Millions was anywhere near it, where your blog is, but people would ask me questions about investing in the thrift savings plan or TSP, the military retirement program and I couldn’t say, “Oh yeah, I have a whole series on how to invest in the TSP on militarymillions.com.”

Dr. Schofer: I couldn’t say it, because I can’t use my government position to benefit me personally. It was awkward. No one ever said anything to me about it. I did it kind of anonymously. It wasn’t hard to figure out who I was, but I never put my name just openly out there. I didn’t have a picture on that blog or anything like that.

Jim Dahle: Tell us about mccareer.org. Is this you? Is this the military? Are they related? How much influence does the military have on what is written there?

Dr. Schofer: It’s mostly me. Another unique thing I’ve done is I was a detailer, which is the person that helps people get ready for promotion boards and moves people around in the Navy. Not just the emergency docs, but I had 23 specialties and subspecialties that I was in charge of, about 1300 physicians.

Dr. Schofer: I was in this job and it makes me think about what you say why you started the White Coat Investor, because you got sick of typing the same old emails or the same old posts on all the online forums you were participating in. I got sick of typing the same emails and I realized that all this great information was out there, but it was in 15 or 20 different places.

Dr. Schofer: All I did was take all this information that people need to manage their career, put it all in one place. If you can solve a problem and make people’s lives easier, it just tends to take off. It’s unofficial. I don’t do it like you mentioned in the beginning. I don’t ever do it at work. I don’t do it on a government computer. I do it on my own time. It’s got a disclaimer. I’m following the military social media policy.

Dr. Schofer: I get probably about 80% of the content. It’s just job announcements, things that are open. That all comes from the military, but I have to be careful what I post on there. I definitely realize that there may come the time, depending on where my career goes, where someone comes to me and says, “Hey, you can’t really do this anymore.” I haven’t gotten there yet and it’s become so popular that I think if that ever happened, there would be a lot of Navy physicians and other medical people that would have a mini revolt.

Jim Dahle: Now, that’s not monetized at all, correct?

Dr. Schofer: No. I don’t think I can do that, because I would be using my government position to personally benefit. It actually cost me $99 a year. Every year at the beginning of January, I put out this state of the blog and I always put my revenues -$99, which people think is funny. It gets enough traffic that it could definitely pay for itself, but probably a couple hundred dollars a month, but it’s just not worth the risk.

Jim Dahle: Right. Okay. Well, let’s talk for a little bit about joining the military. What do you think should be the primary considerations for a student or a doc that’s considering becoming a military doctor?

Dr. Schofer: Well, I agree with things you’ve said in the past. It definitely shouldn’t be finances, that’s a huge part of it, especially with the cost of medical school nowadays. I really think people should only join the military if they want to be in the military.

Dr. Schofer: If you go to USUHS, the Uniformed Services University of the Health Sciences, the military medical school, you’re talking about a seven year commitment. That can be a long time. Most people who go there know they’re just going to be sticking around for 20. When it comes to the HPSP scholarship like I used, you’re talking about depending on how long you’re training is three, four, five year commitment. I know you’ve run the numbers on the finances of that and didn’t feel like it was financially worth your time, I think you went to a pretty cheap medical school, right? Am I wrong there?

Jim Dahle: Yeah, basically the way the numbers worked out for me is … I went to the University of Utah. Tuition was 10 grand the year I started. Everyone came out with loans at 1%. Then I ended up in a relatively high paying specialty, and so the numbers didn’t work out well for me. That wasn’t certainly the primary motivation of doing it. I certainly had a lot of great experiences I could have anywhere else while I was in the military, but number-wise, I definitely came out behind having the military pay for my medical school.

Dr. Schofer: Yeah, I don’t know why, but at the time, MCP Hahnemann was one of the most expensive schools in the country, and it was about $50,000 a year. Both my wife and I went there. She’s a pediatrician, general pediatrician. Relatively lower paying specialty, so we got probably $500,000 of debt. we avoided by both of us getting the Navy scholarship. Like you mentioned, got to do some cool stuff that we wouldn’t otherwise have done. I’d do it again because it’s worked out well for me and for my wife. It’s definitely not a decision anybody should take lightly.

Jim Dahle: Let’s talk about the reasons why people do go into the military. We mentioned the money and I’m sure that’s at least partially motivating to some people. Let’s talk about some of the things that you can only do in the military that would cause somebody to go, “Yeah, I want to be a military doc.”

Dr. Schofer: Well, if you want to see the world on the taxpayer’s dollar, I suppose that’s a reasonable thing to do. I’ve practiced for two years on Japan on Okinawa. An island about a two hour flight south of mainland Japan. Have deployed three times. One deployment I’ve been to, I think I went to 10 countries. I spent nine months in Guantanamo Bay, went to war. Wore the same chemical suit for three and a half weeks.

Dr. Schofer: At the time, I thought we were going to get gassed. At the time, I didn’t think it was very cool, and I don’t think I would have given a very positive endorsement of the HPSP scholarship, but looking back now, it was definitely a life experience.

Dr. Schofer: I think a lot of people joined because they have a lot of family history. I didn’t have a whole lot, but there’s just legacy families. People who are in the military and they’re just from military families. They’re military brats and they join. They just want to serve their country. There’s just a lot of different things you can do in the military.

Dr. Schofer: It’s very easy to change your career. You have orders just come up every three or four years. It’s very easy to bounce around. You can go with the Marines and then come back and do clinical medicine, and then do something else and come back and do clinical medicine. I think for people who want a variety in their career, the military can really accommodate that.

Jim Dahle: There’s a lot of different ways into the military each of which has various financial and career benefits, pluses and minuses. There’s attending the Uniformed Services School. You can go through HPSP like you and I did, the Health Profession Scholarship Program where they basically pay for medical school.

Jim Dahle: You can also do the FAP program where you join as a resident or even come in as an attending and often get some sort of a signing bonus. What do you think is the best way in and what are the pluses and minuses of each of the various methods?

Dr. Schofer: I don’t think there’s necessarily a best way. Like we mentioned already, I think unless you’re really committed to a career in the military, I think USUHS with its seven-year obligation, I mean it’s great. You’re wearing a uniform and you’re going to military medical school, you’re getting paid. Your time in medical school will count toward retirement at the end, and so if you hit 20 and then you retire, you get credit for 24.

Dr. Schofer: When it comes to HPSP, you know you’re getting a stipend, you get a signing bonus. You’re not getting full active duty instant pay like somebody at USUHS, but you’re in a civilian med school, you’re not wearing a uniform. Your commitment is less. Usually, three or four years depending on how many years you get the scholarship for.

Dr. Schofer: The FAP program is interesting, because if you do HPSP or USUHS, you could train in the military. That military time, if you’re training full time in service, will count toward retirement. It counts toward your 20 years you need to get to. If you do the FAP program, you’re in a civilian residency already. That time is not going to count.

Dr. Schofer: Let’s say you do a three-year emergency medicine residency since we’re both emergency physicians. You sign up for the FAP program and you get that extra pay while you’re a resident. You’re going to come on active duty. You’re going to have only three years you owe and you’re going to hit your decision point that you can get out with only three years toward a 20 year military commitment.

Dr. Schofer: I did HPSP because my residency and my fellowship. I hit that decision point at 10, so I was already halfway toward a 20-year retirement. If you had done USUHS, I would have been so close to 20 before you even had that decision to get out.

Dr. Schofer: I think it just depends on your commitment to the military. You want to get your money and get your experience and your leaning toward getting out. The FAP program would be great. You think you’re in for 20 years for sure? Then USUHS would be great and the HPSP is probably a good compromising between those two extremes.

Jim Dahle: Is it easy to join the military as an attending?

Dr. Schofer: Tough. Honestly, it’s a hard question to answer, because people will contact me and they say, “Hey, I’m an ER doctor. I want to come into the Navy.” You think that would be easy, but you have to pass the physical standards. You have to contact your recruiter. It’s just kind of a black hole. I would direct people to the recruiters. It was very rare that I ever heard from anybody again.

Dr. Schofer: It didn’t seem to work out. On a high percentage of the time when people would contact me and say they want to join. You don’t ever get any feedback why. The recruiters are kind of … There’s a command called Navy Recruiting Command and that’s where you direct people. The guys like me on active duty, even as a specialty leader, you don’t get a whole lot of information about what happens to those folks.

Dr. Schofer: I do know a couple of people that did it. It just doesn’t seem to … The ratio of people that are interested to the people that actually wind up showing up one day, it definitely is not a high percentage of success there.

Jim Dahle: Yeah. My take on these different routes into the military is that USUHS seems to be the best route for somebody that wants to make a whole career of it. Not only do you get that extra payment at the end, but you also … You’re in the military, right, from day one and getting paid like it. HPSP seems like a better way for somebody who wants a taste of the military. They want to be in it for four years at the beginning of their career, have an adventure and then go on and have kind of a civilian career.

Jim Dahle: Then FAP seemed like it was the best way to get in if you were interested in avoiding going through the military match because you basically sign on with the military after the match is done. I don’t know if that’s the way you look at them or not, but that seems the way I’ve always categorized them as far as why people pick one over the other.

Jim Dahle: Part of it might just be when they decide they want to go into the military. If it’s too late to apply to USUHS, you can’t go there. If you’re already out of med school, you can’t do HPSP, but that was kind of my take on it.

Dr. Schofer: Yeah, I would agree with that. Honestly, I didn’t even know USUHS existed when I was a senior in college and applying to medical school with the HPSP program. I had already been accepted to HPSP when I even found out it existed.

Jim Dahle: Yeah. Let’s talk about the military match for a minute. What’s the secret to navigating the military match successfully?
Dr. Schofer: Well, I’ve got a post on mccareer.org about tips to match in the military. As the specialty leader, you run the match for your specialty. I’ve done that for a number of years. I’ve been involved in four military matches on the Navy side of things.

Dr. Schofer: I think that you’re in a much smaller applicant pool. Depending on the specialty you want to do, it can be potentially even harder to match. I think the key is, number one, you have to be realistic about your chances of matching in the specialty you’re trying to match in. It’s actually harder to match in Navy emergency medicine than it is to match in general emergency medicine, even though general emergency medicine is extremely competitive.

Dr. Schofer: There were people very year that were applying to be emergency physicians. Even people that already had more than 10 interviews lined up with civilian programs. They were obviously very competitive and I couldn’t take them. I didn’t have enough room. We just had such competitive applicants that it just … it’s just harder to match in the military.

Dr. Schofer: I think that the biggest downside to the military match is that if you wind up not getting what you want, the military is going to find a job for you. You could wind up being a transitional intern or an internal medicine intern or any kind of intern even if it isn’t the one you wanted, because hey, guess what, you’re on active duty and you need a job. I think that can definitely … That uncertainty can definitely frustrate some people.

Jim Dahle: Yeah. I remember the year I applied in the Air Force. There were about 50 of us that want to do emergency medicine. I think there were about 15 active duty spots and about 10 deferrals into the civilian match. The match rate that year was literally 50% into emergency medicine in the Air Force, which was I think emergency medicine that year was like 93% in the civilian match. People that wanted to do emergency medicine got to do it. It was dramatically more competitive in the military.

Jim Dahle: On the flip side, I know of at least one doc who wanted to be a dermatologist. Had spent some time as a family practice doc and then came back and applied to do dermatology and it was dramatically easier to match into dermatology in the military that year than it was in the civilian world. I think it goes both ways.

Dr. Schofer: Yeah, it just depends on how many applicants there are. I mean your ratio of two to one. Applicant’s spots is pretty much what I’ve been dealing with in emergency medicine. In some of the specialties where on the outside they would be really competitive, there might not be a whole lot of training programs in the military and then one year there might just not be a whole lot of applicants, so you may luck out.

Jim Dahle: I know a lot of people wonder if they can get good training in the military. I mean is that factor specialty dependent? Do you have any tips for maximizing the quality of your training if you have a military commitment?

Dr. Schofer: Yeah. I personally think that the military programs across the border are excellent, but I’m also probably biased because I trained them. There was an article that recently came out this week that showed that they were looking at general surgery programs in the one at Madigan, which is an Army hospital was ranked number one of more than 200 programs in general surgery of the percentage of their graduates that passed their boards the first time around. Something like 97% or 98% first-time pass rate.

Dr. Schofer: The article is saying if you’re in the 89th percentile on your in-service training exam, you’re at the bottom of your class. What I usually would tell people, because a lot of the medical students and people that are applying for specialty would ask me as a specialty leader, “What’s your take?”

Dr. Schofer: I would say, “Look, I think in the military, your program, you’re going to be surrounded by people that are a little more regimented, oftentimes more older and more mature because a lot of people in the Navy at least wind up doing general medical officer or GMO, flight surgery or undersea medical officer tour, so they’re a little older.” It’s just a more motivated bunch I think.

Dr. Schofer: You’re still going to see sick patients. You’re still going to get all the training you need, all the programs that are accredited, so it’s still going to get you to the same place, board-certified and whatever specialty you want to be. Compared to the civilian, there’s also some experiences in the civilian world you’re just not going to get in the military. Meaning like just in our specialty, for instance, if you want to crack chests every day, it’s not happening here and I think you know that.

Jim Dahle: Yeah, for sure.

Dr. Schofer: It will happen in your 40% or 50% of your out service rotations that you’re doing in civilian hospitals, because you just got to do outside rotations to get the mix and the patient acuity that you need. If you want crack chests every day, hey, you’re going to want to do a civilian deferment. I think the academic programs and the teaching in the military programs are excellent. I did a fellowship at a very highly regarded civilian residency program, and I just think the education and the quality of the residence was superb in the military when compared to the civilian world.

Jim Dahle: Yeah. That was kind of my take on it as well. Obviously, I have a bias as well as faculty member for a military residency program. The residents were always very sharp academically. There’s a big focus for sure on doing well on board exams. They like being able to say, “Hey, we’re number one of all programs.” I think there’s a little bit of a chip on the shoulder of most military residency programs.

Jim Dahle: The problem came in, in that they were taking care of a very healthy population particularly the active-duty population is very, very healthy. They don’t have a lot of terrible diseases, and so in a specialty like general surgery or emergency medicine or critical care, the pathology in the actual military medical center was going to be lower than what it might be in a comparable civilian center.

Jim Dahle: I think the way most programs deal with that issue, lower numbers of procedures and a little bit less pathology is by doing a lot of rotations outside the military. I guess my question for you is do you think that’s adequate to make up for that loss of pathology and procedures?

Dr. Schofer: I do. Like I said though, if you want to be doing this stuff every day every month then you’re probably going to want to get a civilian deferment. We all have to meet the ACGME requirements whether you’re a military program or civilian. I personally enjoyed it a lot. I thought it was great to go out into a civilian hospital and take care of the sickest of the sick for two or three months and then come back and take a little breath and refocus on academics and then jump back into the fray a couple months later.

Dr. Schofer: I think I am … This is, again, maybe I’m biased, but I really think if you gave me one medical student and I had to make them the best physician in any specialty and I had a choice, civilian or military, I’d go military because they’re just going to come out with … I just think they’re going to be better.

Jim Dahle: All right. Let’s move on to the end of residency here. Do you have any tips for a doc coming out of residency to get the assignment they want? I don’t know if I’ve ever talked on this podcast about the horror story I had coming out, but what tips do you have for somebody having kind of been the specialty leader and been a detailer to get the assignment they’d like to have?

Dr. Schofer: Well, what was your horror story?

Jim Dahle: Well, I’ll tell my story. It was interesting. I was in a civilian residency. I had gotten a civilian deferment out of the match. I had no military experience whatsoever. I find out from a letter or something that I need to submit some kind of a rank list of all the places that Air Force emergency doctors can be sent.

Jim Dahle: My wife and I stewed about it and we went back and forth, and we prayed about it and we came up with this list in the order of where we’d like to go. A couple of weeks later after we sent that in, I get a call saying, “Hey, we’ve got penciled in for Keesler.” This was a list of 15 places, right? Keesler was number 15.
Jim Dahle: I think a hurricane had just gone through it and flatten the hospital or something. I mean it was not exactly a desirable place to go at the time. I said, “Why do I make the rank list? What’s the point of making it if I just go to number 15 on it?”

Jim Dahle: I ended up at Langley because I was talking to Linda Lawrence who was the specialty leader at the time. She was a future president of the American College of Emergency Physicians, but she said, “Well, we have one other spot. We’re going to try to open back up at Langley.” I covered the phone and asked my wife, “Where’s Langley?” She said, “Virginia. Take it. Take it.” That’s how I ended up at Langley.

Jim Dahle: It actually worked out pretty well, because I got to work most of my shifts with the Navy which was pretty fun. I was the only emergency doc at Langley for a year and there are only two of us for another year before we started getting more docs in there.

Dr. Schofer: Yeah. I mean as a detailer who assigned all sort of specialties and then specialty leader have been assigning people for four and a half, five years. I think across the board, you have to realize when you’re a new grad out of residency, like you experienced, you’re at the bottom of the barrel. People who are overseas and want to come back, people who have gone operational, deployed, people who are senior to you. It takes a little while for you to rise up to the level where you are going to get the pick of the litter.

Dr. Schofer: I would also encourage people to always just be honest. The military is still with honest people and we all talk. If you try to play games, there are people who would try to play their specialty leader off of me when I was the detailer. Play dad against mom. Well, dad and mom talk. The military is about people, so you want to treat people nicely and don’t play games.

Dr. Schofer: Yeah, you’re right. When you’re junior, most of the time, you’re going to get what no one else wants. You’re going to get what nobody else wants. To be honest with you now, at least in the Navy Emergency Medicine, we do a match. We use the ACGME matching algorithm and it is literally an algorithm. It’s not really about seniority like all the places that have spots, submit a rank list and then you submit your rank list just like you did and it gets run through the algorithm, and that’s where you go. We found a fairly transparent and fair way to do it, at least in my specialty that people seem to like.

Jim Dahle: Let’s talk about what people like anyway. In your experience, what percentage of docs are happy in the military and what percentage of the docs there just can’t wait to get out?

Dr. Schofer: Well, I don’t know. It’s probably the rule of thirds. There’s probably a third that can’t wait to get out, a third that are vacillating between … Are pretty neutral, and then a third that love it. I don’t really have a sense across the services, especially Army and the Air Force how unhappy or happy people are.

Dr. Schofer: I think probably the most unhappy people are the people that pick a service that doesn’t align with what they like. They don’t like to camp and they join the Army. I don’t understand that. They can’t swim and they join the Navy. This stuff happens all the time. It just doesn’t make a whole lot of sense. Or they sign up like we’ve already talked about. They sign up for the military just purely for the money. They don’t want anything to do with the military. As you know, when you’re in the military, there’s a whole lot of stuff that comes with it that has nothing do with being a doctor.

Jim Dahle: Yeah, for sure. In my experience, I think the Air Force attracted a higher percentage of docs who kind of did it for the money. I found as a general rule, having worked basically in the Navy and in the Air Force that the Navy docs were happier with their choice to join the military. I never really understood exactly why that was.

Jim Dahle: I think it was not necessarily that the Air Force was treating people particularly badly while they were in. I think it was that the people selected themselves that way and people who are more likely to be happy as military docs join the Navy or the Army and not the Air Force, but I don’t know that, that experience is generalizable.

Dr. Schofer: Yeah, I don’t know. I don’t interact with the Air Force very much. The best thing about it is they always have nice golf courses as you know. Pretty nice one up at Langley. Their deployments tend to be shorter. The Army’s tend to be really long and ours tend to be in between. We’re obviously usually clustered around the water so you want to live on the beach, you want to join the Navy, but I don’t interact with the Air Force very much. I really don’t. I interact more with the Army than I do with the Air Force.

Jim Dahle: I hear lots of … I don’t know if it’s complaining, but lots of discussion and worrying among medical students and residents about GMO tours. What’s your take on a GMO tour?

Dr. Schofer: I’ve been in the Navy 17 and a half years and I think for 17 and a half years, they’ve been getting rid of the GMO tour. People probably don’t even know what it is, but you basically do your internship and then you go spend some time as a GP. You’re basically a primary care physician for a bunch of healthy people on a ship or with the Marines in whatever setting. Sometimes you’re even in a clinic.

Dr. Schofer: You get a little extra pay. You definitely get a lot of experience. You oftentimes feel like you’re over your head because you’ve only had an internship. Very rarely do people complain about it once they get into it. You get the pay. Their life is pretty good. They get experience. They get a little bonus when they come back and apply to the GME match. The military match, rewards those who have gone out and done their time. It’s very rare that people complain about it.

Dr. Schofer: There’s a lot of people that just want to do their straight through training and then like I said, the Navy is talking about getting rid of that forever, because the Army and the Air Force don’t do a lot of this. We’re a little unique in the Navy with respect to that. It’s very rare that people complain about it. It’s usually a pretty good experience for folks. You get to go out there and grow your clinical skills and come back and refocus on your … Doing your residency program with a little extra experience in your bag.

Jim Dahle: What do you like best about being a military doc?

Dr. Schofer: It means something to me to serve my country. I think that we get to take care of some of the best patients in the world. There’s great people out there, but I think that the people I get to take care of, although like you mentioned are oftentimes not as sick as some of us would like potentially. I think they’re just great people. They’re part of the 1% or less that have worn the uniform, and it’s an honor to take care of them.

Jim Dahle: What do you dislike the most about being a military doc?

Dr. Schofer: Online training. That is not even a question. The solution to every problem in the military is to create online training and make you do it. It just drives you crazy. You’re a board certified emergency physician and you have to do online training about the flu shot. Really? I have to learn about the flu shot and I have to go through 20 PowerPoint slides about the flu shot, but you do. I’m sure you experienced these things.

Jim Dahle: Oh, yeah.

Dr. Schofer: They’re the things you have to do. At some point, your brain shifts and you know you’re in for 20 and then you start to realize, “This online training that I used to hate. Well, at least they’re paying me $100 or more an hour to do it.” I suppose there’s worse things in life, but yeah, online training. That is absolutely the worst.

Dr. Schofer: I’ll tell you, Secretary Mattis, the secretary of defense, he’s trying to reduce the training burden and trying to get rid of training that does not have anything to do with your primary job, but man, we still have it. That’s crazy.
Jim Dahle: How long do you expect to stay in the military?

Dr. Schofer: Well, I’m in 17 and a half years and so I got picked up for O6, so I …

Jim Dahle: Congratulations.

Dr. Schofer: Thanks. I align my bonus to … I have to stay into 21 now to retire as an O6, so I’ve got three and a half more years. I’m planning a 30-year O6 career, but I honestly don’t think you really know what you want to do until you’re faced with the decision. You’d have to ask me 9 to 12 months ahead of my 21 year mark when I could get out, because you got to submit your retirement paperwork 9 to 12 months ahead of time.

Dr. Schofer: Planning 30 years, but as you’ve experienced, things change so rapidly in the military. What it is now compared to what it’s going to be like two and a half years from now when I’m actually facing that decision that I could actually retire. It could be drastically different.

Jim Dahle: It’s interesting. When I was a captain. In the Air Force, a captain is an O3. In the Navy, a captain is an O6. It’s basically the guy in charge of an aircraft carrier. When I’d call the lab and say, “This is Captain Dahle and I’m wondering where my CBC is.” I sure got a lot of attention, and so that was kind of a fun thing about being down there.

Dr. Schofer: I know. Every now and then, somebody will do that and then they’ll show up and they’ll be wearing their Air Force uniform, because we have a lot of joint residency programs. You’ll pull them aside and you go, “I don’t think you should be doing that in the Navy. Maybe you ought to call yourself doctor.”

Jim Dahle: All right. Let’s get to some more hardcore financial topics here. Let’s talk about disability insurance for military physicians. What do they need to know about disability insurance?

Dr. Schofer: Well, I think, as you know, I’ve written that article for disability insurance for military physicians on your site. I think the bottom line is you got to realize that if you’re a highly paid professional in the military that the military’s disability insurance coverage if something would happen to you is not going to compensate you like you’re a physician.

Dr. Schofer: It’s very hard to get disability insurance as an active duty physician or officer or whatever you do, attorney, dentist. For some reason, insurance companies don’t want to insure people that go to war. It took me half my career to find any policy that would give me a supplemental coverage, and that was the American Medical Association group coverage. They’ll give you up to $2500 extra disability insurance a month.

Dr. Schofer: Then if you really want to get into an individual policy, the best you can get, you go to one of your people that you recommend in your site and they will … You’re really stuck with, nowadays, Lloyd’s of London, which is pretty expensive. Back when I did it, I was able to get Northwestern Mutual and Lloyd’s of London cobbled together and I was able to get an extra $6000 of coverage a month if I was disabled on top of the military.

Dr. Schofer: Then if after five years I was still 100% disabled, I got a lump sump payment of $500,000. That was certainly better than what I would have gotten in the Navy if I was disabled and couldn’t practice, but you can get a disability insurance, but man, it’s expensive. I don’t know what it’s like to get it as a civilian, but it’s expensive and extremely hard to get for somebody in the military.

Jim Dahle: Now, you can still get a Mass Mutual policy as well, can’t you, for military docs?

Dr. Schofer: Actually yeah. Now that I think about it, it wasn’t Northwestern, it was Mass Mutual.
Jim Dahle: Yeah.

Dr. Schofer: I think you’re stuck with Mass Mutual and Lloyd’s, but there are maybe other options out there.
Jim Dahle: I think that’s right. Basically, the big five or six disability insurance companies, you got one of them. The Lloyd’s policy is not an awesome policy compared to the typical civilian doc gets.

Dr. Schofer: Yeah. I was able to get 2000 through Mass Mutual. I think my payment was approximately $100 a month for that. The Lloyd’s, I save 20% by paying … It was a five year policy, so I bought it in a lump sum. I think it was going to cost me about $12,000. I paid 10 and I saved $2000 by just paying it all upfront. It’s pretty pricey especially with the military salary depending on where you are in your career.

Jim Dahle: Yeah. There’s not a lot extra money there to be buying expensive disability insurance. That’s for sure. Let’s talk a little bit about the blended retirement system. Now, we’re recording this in December of 2018. I think there are some people that have to make this decision by the end of the year, but they won’t hear this podcast for another six weeks or so.

Jim Dahle: We’ll just assume that we’re talking about the system as it will be in place as of the start of 2019. Can you explain what military doctors have been doing about retirement savings for the last year or two since they’ve been hearing about this new blended retirement system?

Dr. Schofer: Sure. The old legacy system, which is what I have, it was a cliff vest. You had to stay in 20 years or you got nothing. If you got out at 19 years and 11 months, not that anyone would do that, but if you did, you left with nothing. No DOD contribution to your retirement and all you would have is whatever you of your money you put into the thrift savings plan, which is our 401(k) equivalent.

Dr. Schofer: Now under the blended retirement system, you will get a DOD match. If you contribute 5%, they’ll match up to 5%. That way, if people leave, they actually leave with some DOD money in their retirement account that they can take with them. I think it’s much more modern system, but if you do the BRS or you’re under the BRS and you stay till 20, your pension gets cut by 20%, because the multiplier under the old system is they take the average of your top three years of your highest pay, and then they multiply it by two and a half percent times the number of years you’ve stayed in.

Dr. Schofer: If you stay in 20 times two and a half, you basically get 50% the average of your highest three years of pay. Under the BRS, instead of the multiplier being two and a half percent and it’s cut by 20%, so it’s two. You can get 40%. You still get a pension, but all along the way, you got to match of up to 5%.

Dr. Schofer: In the end, you could work out, depending on how your investments do, you could obviously make out even better. You just don’t know. I think it’s a much more modern system. The math, I have physician specific numbers, but it’s among officers, 57% get out before 20 years. Only 43% stay in. The percentage among enlisted is less than 20% stay into 20. The overwhelming majority of people under the old system got nothing toward retirement. It was just whatever they saved.

Jim Dahle: Now, as of 2019, there’s no decision to make anymore. You’re just in this new program, correct?

Dr. Schofer: Correct. Now, from what I understand, anyone that signed … For instance, if you signed an HPSP scholarship under the old system and you’re just not on active duty yet because you haven’t graduated from medical school, what we have been told is that anybody in that situation, once they come on active duty even if it’s on 2019 or 2020, they’re going to have a one-time chance to either go with the old system or come under the new BRS.
Jim Dahle: What do you think? Somebody that plans to make a career out of it, which one should they choose?

Dr. Schofer: I don’t think it’s that simple. Life changes. I think if you plan to make a career out of it, there’s a ton of people that plan to make a career out of it that didn’t. I think if you know you’re just going to do your time and you’re just going to get out, you’ve got to take the blended retirement, because that’s the only way you’re going to leave with any DOD money toward your retirement accounts.

Dr. Schofer: If you’re not sure, like we just talked about, the odds say you’re not going to do it, so you should go BRS. If you’re 100% positive you’re going to stay 20 years, my personal opinion is you should stick with the traditional if you had that choice. Like you said, by the time they’ve listened to this, most people won’t have a choice anymore. They either already made the choice or they came in under the BRS.

Jim Dahle: Yeah. I certainly would have had more money if I had been under the BRS rather than the old system. I imagine if it’s 57% for a typical officer, it’s got to be higher than that for docs. I think most docs probably get out, don’t they? Maybe not so much in the Navy, but certainly in the Air Force. It’s a higher percentage than that.

Dr. Schofer: Yeah, that’s always been my guess. I just don’t have physician’s specific data to back it up, but because of the job market and the money you can make, I would suspect you’re right.

Jim Dahle: Let’s talk a little bit about a reserve pension. A lot of times, a doc decides, “I’m going to get out of active duty, but I’m going to go on reserve so that I can get this different pension.” It’s not the same pension, but it’s a pension that starts at age 60. What’s your take on that? What do you think about that as an option?

Dr. Schofer: I think it’s a great option. Not necessarily because of the pension, but because of … You and I have talked before online, the value of Tricare. That’s the part of it that a lot of this fire community, their biggest worry is what are they going to do about health insurance?

Dr. Schofer: While there are other options out there, a reserve pension while it won’t have the same pension that I would have, it doesn’t start till 60 versus I could retire age 46, and my pension would start immediately. That reserve pension would be probably lower, and it doesn’t start till 60, but it’s still government pension, inflation adjusted, but it gets you that Tricare.

Dr. Schofer: To me, I think if you get out and you can work, earn your normal wage as a civilian physician, it’s probably going to get more money that you’d make in the military unless you’re in a primary care setting, because honestly, they get paid pretty well in the military. Then you combine that with the reserve pension that kicks in when you’re 60 and gets you access to Tricare, that’s pretty … It might be the most financially lucrative way to do it. You just get the benefit of both worlds.

Jim Dahle: Of course, it’s not a free benefit. You got to put in your time as a reservist as well. Those folks are I think earning that pension as well.

Dr. Schofer: Yeah, there’s no doubt about that. Your pension will start before 60 if you’ve deployed or been activated, so it depends on how much time you’ve done that, but it will start. Let’s say you did that for a year, it will start a year earlier than 60.

Jim Dahle: I didn’t realize that. That’s a nice benefit. I think for people that got deployed a lot, that could add up to several years.

Dr. Schofer: Yeah.

Jim Dahle: Let’s talk a little bit about financial independence in the military. You said that you were either becoming financially independent relatively soon or you already are. Do you think it’s easier or harder or about the same for a military doc to become financially independent?

Dr. Schofer: I think it’s easier, because … You know what, I’m definitely financial independent, but just because I can’t get out of the military for another three and a half years, but then when you combine what I have and the pension and what I live off of, yeah, I’m financially independent as long as I stay in another three and a half years.

Dr. Schofer: I think it’s easier because of the healthcare, the access to Tricare. I think it’s easy because people really underestimate the value of the inflation-adjusted pension for the rest of your life. Every year, the Department of Defense has to report to Congress. They say a whole accounting of the retirement system.

Dr. Schofer: The net present value, how much money you do have to have now in order to equal a 20-year O5 commander or lieutenant colonel retirement, which really isn’t hard for most physicians to get, is $1.3 million. For a 21-year O6, which is a pretty common Navy captain or colonel, pretty common decision point to get out, that would be my decision point, it’s 1.6 million.

Dr. Schofer: You can’t spend it. You can’t screw it up. As you experience certainly, there’s just tons of ways that doctors, whether it’s buying the doctor house or the doctor car or getting the doctor divorce, can screw up their finance. You just can’t spend or screw up your military pension, although I will admit that if you’re married long enough and you get divorced, they’re entitled to some of it, but it’s just hard to mess up.

Jim Dahle: Yeah, I think that’s one big advantage of it. Another big advantage, of course, is that you don’t start out in this huge hole. You don’t have that debt in the beginning of your career. I got an email this week from somebody who was a doc, 50 years old, owes $300,000 in student loans and has $300,000 toward retirement at 50 years old. I think starting at zero is, in some ways, a big huge advantage.

Jim Dahle: I think another advantage in the military is that there’s not this expectation of spending that’s quite so high as it is in the civilian world. People know you’re in the military and they know military docs don’t necessarily get paid that much. I think there’s not quite the expectation to have the fancy doctor house and the fancy doctor car and the fancy doctor vacations. I wonder if that doesn’t contribute as well.

Dr. Schofer: Yeah. You get a lot of things to provide it for you. You get a lot of tax benefits. You get your allowances. You get free services on base, reduced costings like commissaries, the daycare is cheaper. It was cheaper when we needed it. There’s a whole host of benefits. I don’t have to think about what I’m going to wear to work every day.

Jim Dahle: Yeah. Certainly, save some money on scrubs there. An emergency doc is going to save a lot, but fire is really one of those things that people talk about a lot and they talk about all the changes they’re going to make when they’re financially independent, how they’re going to work less, how they’re going to quit their job. How they’re going to do an encore career. How they’re going to drop their night shifts or whatever.

Jim Dahle: In the military, you can’t necessarily change your job just because you’re financially independent. What’s the point of financial independence in the military if you really can’t cut back on work or dictate how you work or avoid deployments, etcetera?

Dr. Schofer: Well, I think that you can do some of that. If you stay in and you promote and you become a senior leader, now you don’t want to be some kind of dirt bag that never works, doesn’t deploy and deploys everybody else. You have to keep yourself honest.

Dr. Schofer: I think you do have a lot of say in how things go in your career if it progresses and goes the way you want. You just know that when you hit that 20 or 21 year mark that you have that option just like I do. I could get out and do whatever I want. Yeah, maybe I can’t fire at 10 or 12 years like some of these fire folks can, but I’ll be 46 years old. That’s still retire early. I don’t know that I’ll be retired. You’re right. Like I said, you can’t do a 12-year career in fire because you’re not going to get a pension, but 20, that’s still pretty early.

Jim Dahle: Yeah. I think one of the most underestimated ways to fire is to join the military at 18, have them put you through college. Finish it 38 with an officer’s retirement and collecting Tricare and this pension for the rest of your life. That’s 38 years old that someone who joined at 18 could get out at, and that’s really a pretty quick route to fire. We have a lot of people envious.

Dr. Schofer: I don’t know that your four years in college would count. You’d probably have to do it till 42. Same thing. You’re right. Yeah. Then you’ve got access to Tricare, which takes care of one of the biggest worries for people that are in the fire community.

Jim Dahle: Now, a lot of military docs moonlight. Let’s talk about that. What tips do you have about how moonlighting should be done in the military.

Dr. Schofer: I used to have to approve people’s moonlighting applications. They would come to me requesting permission to moonlight and I think one of them was common mistakes they would make which you certainly are very familiar with is they already sign the contract to moonlight and they’re going to be an employee.

Dr. Schofer: They didn’t understand that if they were an independent contractor getting paid on a 1099 instead of the W2, they’d have the options to open up additional space in tax advantage accounts like in a SEP-IRA preferably as you’re well aware of a solo 401(k) over the SEP. They’ve made that mistake because in the military …

Dr. Schofer: That’s the one thing. Actually, I don’t moonlight. I don’t have very much tax protected space. I’m backdoor Roth. My wife is backdoor Roth, and then the TSP. After that, everything is in taxable accounts. If you’re a 1099 moonlighter in the military, you can open up that solo 401(k). You probably can’t moonlight enough to fill it up, because there’s limitations on how much you can moonlight, but definitely, you could put another $10,000 or $20,000 in there potentially depending on how much you’re working.

Jim Dahle: What are the limitations on moonlighting in the military?

Dr. Schofer: Well, I know that in the Navy, you’re not allowed to do more than 16 hours a week. You could do more than that if you’re on leave, on vacation. I’m not sure how they limited in the Army or the Air Force. You also, in the Navy, at least you have to be on leave if you’re more than two hours away from your home station.

Dr. Schofer: I can’t fly to San Diego to moonlight over a weekend. I got to take leave. They have a two-hour radius around where you are and you can’t do it more than 16 hours a week without requesting special permission.

Jim Dahle: Now, let’s talk a little bit about. You’ve mentioned several times that you have the TSP, the thrift savings plan or the military 401(k) system. I get a lot of questions about whether an attending physician in the military should be using the Roth option there or the traditional tax deferred option. What’s your take on that?

Dr. Schofer: Well, I think the probably the Roth option, because like we’ve already talked about, most people are going to get out. Their income is probably going to go up. While they’re in the military especially with all the tax advantages you have with some of your allowances, you’re probably in a lower tax bracket, so it probably makes more sense to pay the Roth version.

Dr. Schofer: My personal opinion on it is that I can afford the taxes now, so I put every dollar I can in the Roth. I have no idea what the future holds when it comes to tax rates or changes in law. For the first half of my career, we didn’t have a Roth option. I’m shooting for a 50-50 ratio just to have that variability, but I can’t catch my traditional TSP. It’s just because of all the compounding and all the years I had it early in my career where there wasn’t even a Roth option. I’m a huge fan of filling any Roth space you have, but I’d be interested in hearing your thoughts about it.

Jim Dahle: Yeah, I’m totally jealous. I got out in 2010. There was no Roth option available to me. I think a military doc ought to be going all Roth all the time kind of like a resident. For a couple of reasons. One, you’re in a low tax bracket. A quarter, a third of your income is tax free. It’s an allowance. It’s your BAH and your BAS. Plus, you’re probably a resident of a tax-free state if you’re like most people in the military, so you’re not paying any state income taxes.

Jim Dahle: Then when you get out, even if you get out without a retirement, you’re going to be making more and in a higher tax bracket. If you get out with a retirement, you’re going to have a pension that fills up all those lower tax brackets. Either way, I think you’re better off with a Roth. I see very little reason for any military doc to not be doing the Roth TSP. It would really have to be a pretty unique situation to make sense I think.

Dr. Schofer: Right.

Jim Dahle: All right. Let’s talk about tax loss harvesting. You made this comment in an email you sent me this week that you don’t tax loss harvest. Tell the listeners why you don’t.

Dr. Schofer: I don’t because I don’t care anymore. Are you not there yet? Are you only doing it because you have a financial blog? I mean seriously. I’m asking you.

Jim Dahle: There’s no doubt that it’s not going to move the needle for us, for sure. What are we talking about? It’s $3000 a year against your ordinary income. Maybe that knocks $1000 or $1500 off your tax bill in a given year.

Dr. Schofer: Yeah. I don’t have near the income you do because of your blog, but I choose life. I don’t know. I just don’t do it. I just read a lot of people like Physician on Fire and you, they talk about tax loss harvesting. I just sit there and think, “Man, these guys would think I was a total moron.”

Dr. Schofer: I just can’t get myself motivated to do it. It’s like the financial equivalent of online training in the military. I just can’t do it. I don’t know. I just don’t care, but I just always thought you would find that … Maybe you would tell me I was stupid for not doing it.

Jim Dahle: It reminds me of a post that the Physician on Fire did recently where he tried to calculate the actual benefit of doing a backdoor Roth IRA versus just investing in taxable. I think his conclusion was that it was worth a lot less than a lot of people think it is.

Jim Dahle: At a certain point, at a certain level of wealth, it’s true that all these little financial tips that we talk about on blogs and podcasts don’t make a huge difference. The reason why is because you got the big rocks right. You got your income up. You saved a big percentage of it. You invest it in some reasonable way. You kept at it for a couple of decades and now you’re wealthy.

Jim Dahle: It’s really not about the little tricks and tips and a few bucks here and a few bucks there. Sure that might speed the process a little bit, but in reality, getting rich is pretty straight forward. You make a lot of money. You save a big chunk of it. You invest it in some reasonable way and you protect it with some insurance policies, and that’s really all there is to it.

Dr. Schofer: Yeah. My father is pretty wealthy. He owned a couple businesses and he’s retired when he was about 50. I wonder if I’m going to get to his point. He’s at the point where he can’t stand his retirement accounts now. I don’t think I’ll ever get there. You can’t stand them because they limit what he wants to do and he’s going to have to do RMDs. It just drives him crazy. Hopefully, we’ll both get there one day too.

Jim Dahle: Yeah, hopefully. We’re going to wrap up here soon. I think we’re pushing about 50 minutes or so. You’ve got the ear of 20,000 docs and similar high-income professionals. What do you think they should know that we haven’t covered yet today?

Dr. Schofer: I think it’s kind of like you just said. It’s real simple. It’s the big stuff. I’m at where I am today on a military salary because I saved 30% of my gross income for the majority of my career. The other half of that equation was I didn’t drive the doctor car, I don’t live in the doctor house and I haven’t had the doctor divorce. When it comes to the military, people just can’t. They just don’t underestimate the value of that inflation-adjusted government guaranteed pension if you can stay in for 20.

Jim Dahle: Dr. Schofer, thank you for your time and for coming on the podcast and congratulations on your selection for captain.

Dr. Schofer: Hey, thanks. Thanks for having me Jim.

Jim Dahle: That was great having Dr. Schofer on. One of the things I miss about the military is the high quality of the people in it. I just love seeing people that have this desire to serve. It’s wonderful. Thank you to him for being willing to come on. I think we’re about six months trying to get him on the podcast, but what I’m finding is I get further and further away from my own military service now eight and a half years ago is that I’m starting to not know the answers to the military financial questions.

Jim Dahle: People started asking me about this new blended retirement system and I have no idea because it wasn’t in there when I was on active duty. Remembering details like when the reserve pension starts and that sort of stuff. It’s nice to have somebody watching me and correcting me when I make the inevitable errors. Dr. Schofer has been doing that for me over the last year or two. Every time I screw something up with the military, he shoots me an email and I’m able to correct it, so I appreciate that.

Jim Dahle: This episode was sponsored by Bob Bhayani at drdisabilityquotes.com. They’re a truly independent provider of disability insurance planning solutions to the medical community nationwide. Bob specializes in working with residents and fellows early in their careers to set up sound financial and insurance strategies. Contact Bob today by email at [email protected] or by calling 973-771-9100.

Jim Dahle: If you haven’t checked out our Facebook group or our subreddit, be sure to do that. Please leave us a five-star review if you can on iTunes. Also, if you’d like to get your questions on the episode, leave them at speakpipe.com/whitecoatinvestor and we’ll get your voice on the White Coat Investor Podcast.
Jim Dahle: Until then, head up, shoulders back, you got this and we can help. We’ll see you next time in the White Coat Investor Podcast.

Disclaimer: My dad, your host, Dr. Dahle is the practicing emergency physician, blogger, author and podcaster. He is not a licensed accountant, attorney or financial advisor, so this podcast is for your entertainment and information only. It should not be considered official personalized financial advice.

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17 comments

    1 hpyelori |

    I think something to take into account at this juncture is the upcoming significant changes to military medicine. No one (except maybe big brass) really knows yet what training options are going to look like even next year, especially for lower priority fields (OBGYN, peds, etc.) I would personally only recommend joining the military medical field right now if you are planning to do EM or something similar. The uncertainty of our future right now is much higher than the typical military uncertainty we usually tolerate.

    MillennialDoc |

    A link to a story, covering potential upcoming changes to military medicine:

    https://www.stripes.com/more-than-17-000-uniformed-medical-jobs-eyed-for-elimination-1.563807

    hpyelori |

    Oh, yes. I’ve read all the articles I can get my hands on! Specifics are still very vague on how this will affect future training. We are hoping to know soon to plan for fellowship/no fellowship.

    MillennialDoc |

    As an HPSP student, I have also been reading a lot of articles. I have come to the conclusion that while in the military there are many things that are outside the sphere of your influence. I don’t even know which specialty I want to go in, so it remains to be seen how this will affect me.

    The Military Physician |

    100% agree with this. So much we don’t know right now. My hope (blind trust) is that we will be left with something better than what we have right now, but the road to get there will be very rocky. Signing up right now has so much uncertainty.

    I have USUHS time to pay back plus I accepted an FTOS spot. I’m stuck with a big ADSO and will be present through the whole transition, but I am happy to do it. I was planning on a career when I said yes to USUHS and I think that is key to maintaining happiness despite the MilMed headaches.

    Awesome discussion with Dr. Schofer. Thanks WCI and Dr. Schofer.

    Joel Schofer |

    Thanks for reading/listening and being interested.

    2 Bryan J |

    Great article with a lot of good points. As an AD AF Pediatrician at a GME site I cannot emphasize the above uncertainties enough as something to strongly consider for those looking to sign up. Unfortunately, when you’re not even in medical school yet and considering HPSP or USUHS you may not know exactly what you want to do. With vague plans to slash things like peds, OBGYN, IM, folks jumping into the pipeline now may get stuck doing something they don’t want, especially if they get their heart set on things like subspecialties within those cutback fields. Military medicine can be very feast or famine and I’ve seen people get exactly what they dreamed of while others who wanted things like fellowships, inpatient centers, etc get their hopes dashed, some to the point of deciding to change their career path entirely. I’m blessed to have been on the feast side of things and have been a large HPSP proponent most of my career. But with the current uncertainty, I would only recommend HPSP or USUHS to folks who want to go into battlefield/deployment specialties like EM, surgery, critical care, etc, folks who are flexible about their career, and those who are happy to put “the needs of the military” above their own.

    3 LA |

    I’m no longer in the AF but I’ve seen the projected numbers for my specialty and they were calling for about a 70% reduction in staffing. A friend who is the consultant (specialty leader) in a different specialty said his specialty was looking at similar reductions. EM, Surg, Ortho and Anaesthesia were marked for increases. The word is that all three services are looking at similar reductions, though how they approach it is still to be determined. Unless you are interested in those four specialties, I would be very careful about joining the military and I am expecting to see large reductions in new recruits. It will be interesting to see what happens to USUHS and military GME.

    I got a kick from WCI’s story about his assignment. I WAS sent to Keesler in 2006 (probably a year before WCI almost went) which was one year after Hurricane Katrina. I knew that our consultant would consider any thing on my wish list as OK with me (“You got a place on your list didn’t you?”) so I didn’t put Keesler on the list I still got sent there!

    The White Coat Investor |

    That makes me feel a little better. But yes, it was 2006 I came out of residency and on to active duty.

    Bryan |

    What’s ironic about this is the specialties they want to cut are the busiest with more work than they often can handle. Meanwhile, it seems anyway, the surgical, EM etc fields seem to be the most wasted skill set stateside. If they’re serious about increasing the number of those specialties they’re going to to need to let more of them split time in civilian facilities where they can actually build experience

    The White Coat Investor |

    For sure. What they really want is docs who work in knife and gun clubs- UCLA Harbor, USC, U of Maryland etc. Not docs who work in glorified urgent cares when they’re not deployed.

    4 Matthew M |

    So I am one of those rare birds that made the decision to join the military as an attending, in my case joining the Air Force directly out of EM residency in 2017. The finances of joining as an attending are a bit different. There is a different bonus structure, specifically the accession bonus, which can be taken as a lump sum or in equal annual installments. I ended up taking the latter option for tax purposes (as a NY permanent resident I do not pay state tax on military pay if I live outside the state for the whole calendar year). There are some PSLF considerations as well, specifically the ability to get the monthly payments back down to $0 for 12 months while deployed (majority of pay while in a combat zone is not taxable). Taking into consideration all the bonus pays, BAH and BAS, as well as the money I am not paying for student loans and expected forgiveness, I make about 85-90% of what community/academic EM docs make in my area. Based on a rough NPV analysis, admittedly using a lot of assumptions, joining as an attending might actually be the most financially rewarding way to go about military service for an EM physician. However I absolutely agree with the article that it is important to want to serve, not just to do it for the finances.

    The White Coat Investor |

    One nice thing about joining as an attending is you avoid the military match.

    5 Andre |

    I retired from the Army 2 years ago and still work at a military medical center as a contracted civilian. Some potential upside of all of the uncertainty is that some military positions will get converted to civilian positions. A little talked about aspect of the National Defense Authorization Act (NDAA) of 2017 is that for the first time it allows for the conversion of military personnel to civilian.
    Some upsides of joining/remaining in the military:
    1) Civilian fellowships (if the military sponsors you) are much easier to get, as civilian medical centers recognize that your salary is being paid by the military, so yo are free labor while you’re a trainee.
    2) In addition to the typical retirement pension benefit, Tricare Prime coverage for your family as a retiree is currently on $570 a year, with full pharmaceutical coverage, and no copays if seen at a military facility. While you’re active duty military, the medical care for you and your family are free.
    3) You are allowed to moonlight if you so desire, and can do more than the 16hr a week limit if you are on leave.
    4) The current blended retirement system allows you to contribute to the military’s 401K (with a match), so you’ll have some retirement funds if you decide to leave the military prior to full retirement at 20 years.
    5) Some folks are lucky enough to be stationed in Germany or Italy for a time.
    6) During deployments, you can place pretax money into your military Roth account, and is one of the only scenarios on the planet where you pay no tax at all on that specific income, either going in or coming out of the account.
    7) If you have family members with chronic medical conditions that require specialty care, via the Exceptional Family Member program (EFMP), you can only be stationed at bases where that care is reasonably available, so you have a much higher chance of being at a larger tertiary care facility.
    8) There are plenty of chances for leadership training, as well as membership and leadership on various committees and Departments, so there are plenty of opportunities to bolster your CV for your post-military life.

    6 FlossDMD |

    Great podcast. I thought it was really funny when Dr. Schofer mentioned he doesn’t do TLH. I am nowhere near investing in taxable accounts yet, as I am still working on paying off loans and maxing out retirement accounts and Backdoor Roths but TLH is something that always scared me off about taxable accounts. Knowing that it’s okay to not TLH was a big relief and also a motivator to work towards the goal of investing in a taxable account some day.
    Wish there was a little more discussion about being in the Reserves. I am in the Army Reserves and I think it is great. You qualify for benefits like Tricare, Loan repayment, bonus, TSP and a pension if you serve 20 years. All that while serving your country and having a job of your liking on the civilian side! You can consider it as a side hustle when you are in your working years and can stay in the Reserves even if you ‘FIRE’ someday to keep one income stream flowing in.

    Joel Schofer |

    You can DEFINITELY invest in taxable accounts and not worry about tax loss harvesting. Definitely don’t let that stop you! TLH is great if you want to worry about that, but like I said in the podcast, I CHOOSE LIFE INSTEAD!

    The White Coat Investor |

    I’m amazed anyone found TLHing stressful. It’s totally optional, but if I can lower my taxes by $1,000 in 30 seconds, it’s probably worth my time in my opinion. That’s a pretty good hourly rate.

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