[Editor's note: This is a guest post from long-time blog reader and frequent commenter Beau Ellenbecker, DO, a private practice family practitioner who spent a few years in the Army after accepting an HPSP scholarship to pay for medical school. Similar to me, he has mixed feelings about his decision. In 2007, he wrote an HPSP guide for a student doctor website. He sent me his recent revisions which I thought were worth publishing as a guest post. Those considering this scholarship would be wise to read this prior to making a decision. Beau and I have no financial relationship. I've interspersed a few clearly-marked comments, mostly by way of clarification throughout his post.]
In 2003 I accepted a 3 year HPSP scholarship in the Army. I completed the final three years of medical school under scholarship, then moved to Hawaii for a 3 year military residency, and finally finished my obligation with a 3.5 year assignment in Europe that included an 11 month tour of duty in Afghanistan.
My Experience With the HPSP Scholarship
1. The Pay
- Signing bonus of $20,000 (variable based on needs of the miltiary)
- Monthly stipend of $2100 a month for 10 and ½ months per year
- 2nd Lieutenant pay of $2900 a month for 1 and ½ months per year
- Total pre-active duty pay: $126,000
- All books, fees, and tuition to the medical school of your choice in the USA or Puerto Rico
- Adventure, jazz, props from the public, a nifty uniform, and the sense of pride with military service
- Rank of 2nd Lieutenant while in school and promotion to Captain (Lieutenant in the Navy) upon graduation. Most military physicians are promoted to Major (Lt. Commander in the Navy) at 6 years of active duty (counting residency)
2. How Hard is it to Get HPSP Scholarship? What Are the Requirements?
Pass Physical Fitness and weight standards regularly, be eligible to be commissioned as an officer in the military, enroll in an accredited medical school, apply and be selected (automatic acceptance for Army is 3.5 GPA and 29 MCAT)
3. What is the Payback?
Dr. Ellenbecker enjoying his time in Afghanistan
One year of service per year of scholarship received. Military residencies do count as payback, however, you also accrue one year of payback for each year of residency after your FYGME (Internship) year. In other words you can complete one extra year of residency past your level of commitment without incurring more time. (4 year scholarship recipients can do 5 years of post-grad training without accruing more time). Also if you do a civilian residency you payback will not start until you start on active duty. [Editor's Note: As a general rule, you'll have the same payback whether you are chosen to do a military or a civilian residency.]
4. What Will I Make as a Physician in the Military?
These are new figures calculated as of 2014 for a 4 year scholarship. I have factored in the cost of medical school education, stipend, bonus, and interest to attain a scholarship value.
Scholarship Value
Medical School Education Loans Saved * 4 years: $160,000
Interest Saved: $77,000 (Based on 10 years at 6.5%, post residency)
Pre-Residency Pay: $126,000
Total Scholarship Value (4 years): $363,000 (about 91K per year of commitment)
[Editor's Note: I thought this was an interesting calculation. The value of the “scholarship” to me was much closer to $100K given my very cheap medical school, the interest rates available upon my graduation in 2003, and the much lower pre-residency pay provided then. I'm not surprised to see it is more valuable now given rising tuition, higher student loan interest rates, and the difficulty the military has had acquiring physicians given the high deployment ops tempo in the last decade.]
Military Pay (average stateside)
Pay: 46.8K (Captain)
BAH: 16K (housing allowance, varies by location)
BAS: 2.5K (food allowance)
VSP: 5K (specialty pay based on years)
BCP: 2.5K (board certification pay)
MASP: 15K (flat pay given to all doctors)
ISP: 20K (independent specialty pay based on specialty: Family Medicine)
Bennies: 30 days paid vacation and free health/dental/vision
Yearly Pay as a Practitioner: $108,000
Yearly Compensation as a Practitioner for 4 year commitment: $199,000
(Military Pay + Scholarship Value/4 years)
Average Starting salary for a civilian FP: $145,000 [Not sure of source for this, but at least one easily found source suggests the figure was $170K in 2012. If anyone has current MGMA or other survey data for 2014 I'll replace it here. Bear in mind that this figure may be much higher for your specialty, and even for your individual position- which may be far above average.-ed]
If you choose to stay in the military there are bonuses for resigning that significantly improve your pay however they require multi-year commitments. Currently a four year commitment for a family doctor signed AFTER your initial commitment is worth $30,000 annually. [Editor's Note: It should be noted that these bonuses are highest when your initial commitment is up and quite a bit lower as you approach the magical 20 year mark where you become eligible for a military retirement. The military has thought about all these incentives and uses them to “force-shape.”]
Yearly Compensation as a Practitioner after signing a 4 year ADD ON post initial commitment: $165,000
Pay is pretty competitive for primary care, for specialists it is not even close. A cardiologist in the Army can expect to make at most about $200k. In the civilian side its closer to $300K.
5. What Will I Make as a Resident?
Yearly Pay as a Resident: $65-70,000 (No ISP, MASP, or BCP)
Average pay for civilian family medicine resident – $42-60,000
6. Where Will I do Residencies/Rotations?
Really depends on which service [and specialty-ed] you select. However, I strongly suggest that you do a rotation in the specialty you desire at your top location choice. Most Navy and some Airforce candidates will be required to do GMO/Flight Surgeon tours after their internship (2-3 years) and before residency. You can gain valuable experience but personally, I hate this idea. It puts the least capable and least educated physicians in often isolated environments and makes them responsible for a majority of troop health. The army really only does this if you switch specialties and there are no residency spots available in the specialty you want. [Instead, the army fills these slots with fully board-certified doctors, like a pediatrician working as a GMO/Battalion surgeon after finishing a 3-year peds residency.-ed] Of note, if you chose to get out after you serve extended time as a GMO (if your contract is up), it may be harder to get a civilian residency as you are so far removed from your internship and schooling.
Is the four-year obligation really only four years, or can a “stop-loss” order keep you in much longer? When does my commitment really end?
A stop-loss order in a time of war could keep you in, however, it is highly unlikely given previous use.
7. Assuming a Four-Year Obligation After Residency, How Many Times Can They Make You Move (not counting a deployment, of course)?
1-2 times after residency, unless you are really unlucky. A stateside tour is 2-4 years. Overseas tours are 2 years if you don't have family and 3 years if you do.
8. Since HPSP Students Are in the Reserves During Medical School, Can They Be Called up Even Though They Have Not Completed Their Medical Education for Regular Reserve Duty?
No. Under no way can you be pulled out of school or your 1st year of residency.
10. State School, Private School, or Daddy's Pocket?
You should not take the scholarship for the money. You will regret it. You must have a desire to serve in the military. The military is not for everyone. That being said, you will regret taking this scholarship if you are going to a medical school that costs less than 20K a year. The money you will make early in your career would easily offset such a cheap education loan. Had I gotten into a state school I would not have taken the scholarship.
Dr. Ellenbecker enjoying his time as a civilian
11. What About After Graduation?
The military requires that you apply for a military internship year (FYGME). Nearly everyone will do a military internship. Your FYGME will either be in your field of choice (possibly fast-tracked into a residency) or done as a traditional rotating internship year. In most cases, if you don't match in your field of choice you can defer out and do a civilian residency after completing your FYGME year however you must be accepted to a civilian program in that specialty.
[Editor's Note: By way of clarification, all med students with a military commitment must go through the military match. This has two parts- first for specialty, then for program. If you are not selected for your specialty, the military may put you into a military internship you have zero interest in, such as a surgical internship, then assign you as a GMO. Once you are selected for your specialty, you will either be placed into a military program or you will be allowed to go through the civilian match. You can rank these options in the order you prefer, but the process does not necessarily favor the applicant in the same manner as the more objective, computerized civilian match. This process for your specialty is controlled by a handful of people sitting around a table. For the most part, they are good people who try to do what is right and give you what you want, but they are limited by the “needs of the military” and inevitably, some people (usually the least competitive) do not get what they want. It helps a great deal to figure out who these people (your service's specialty leader and the residency program directors for your specialty and service) are and personally meet, and impress, them.]
12. Retirement
Military retirement is 0% vested until 20 years, after which it becomes fully vested at ½ base salary. Most physicians that choose to stay till retirement will be Lt. Colonels (Commanders for Navy). This means a yearly retirement pay of about $40,000 (indexed to inflation) plus lifetime healthcare benefits. There is, however, talk of modifying the retirement pay. Retirement is pretty good if you stay 20 years as you can still get another job however you HAVE to finish 20 years to get anything. That to me is a big drawback. The military also offers the Federal TSP (like a 401(k)). There is no match, but the investment options are the cheapest you will find anywhere.
13. Why the Army?
Why did I select the Army? Several reasons actually. I have family history in the Army which made me lean one way, but the Army has a lot more scholarships and residencies then the other branches as well. I applied later in the year so my best shot was in the Army. The Navy had some drawbacks for me, mainly in the form of the required GMO tour. The Navy and Air Force arguably have better residency and base locations. I think branch of service is more a personal choice than anything else. However, if I had the opportunity to make my selection again I would probably choose the Air Force.
16. What Was My Career Like in Army Family Medicine?
I completed medical school in May of 2006 and 5 days later moved to Hawaii to begin my residency at Tripler Army Medical Center. Hawaii isn't a bad place to do a residency. I enjoyed my non-working time there and work was tolerable. Tripler is a major medical center so as a family resident I was a little bit disadvantaged when it came to procedures and learning in some of the departments as they tend to teach their own residents first. A medical center does usually provide a nicer call schedule in 2nd and 3rd year than a hospital with only family medicine residents would. Overall, my experience was like most residencies. I would say on a whole that we probably had a smaller inpatient population then some civilian residencies yet we still saw quite a bit of pathology. We also completed a lot more inpatient rotations and OB care than most civilian residencies.
Personally, I think military residencies lack a little in breadth given lower patient volumes but make up for it greatly in depth. I can almost immediately tell a military physician from a non-military physician just by reading a few notes. Military docs tend to write much better and more meaningful notes and tend to be much more cost-effective than civilian docs. Most notes I read from civilian internists are so poor in quality that I can’t tell what has been done to the patient or what their plan actually is.
Each specialty and branch treats your first assignment differently. For my specialty, we are interviewed about where we are from, where we would like to go, and what is most important to us (i.e. location, clinic job, hospital job, unit based job). My wife and I were leaning towards leaving the military and felt that we would only get one shot at living overseas so I volunteered for Germany, however, I was insistent on going to clinic as I felt a unit job wouldn't provide the continued learning I felt I needed leaving residency. The interviewer then weeds through all the candidates and tries to match you as best as he can to a future assignment. Not everyone gets their top choice, but the guy actually does a pretty good job. If you are a good candidate (chief resident, high board scores, former military) or know how to work the system you can sometimes help the process along. In my case, contacting the commander where I wanted to go and being chief resident helped me get the particular base in Germany I wanted.
Prior to going to Germany, I had to complete OBLC (basic training) in San Antonio as I wasn't able to do so between my 1st and 2nd year of medical school. They no longer offer waivers for this course. OBLC was a complete waste of time considering I had been in the army for 3 years and most of the information is geared toward medical platoon leaders, not doctors. If you have the opportunity (most do) to take the shorter course during medical school, you should. You will learn the military finds interesting ways to waste your time. Also never, ever believe anything anyone tells you about your career. Get EVERYTHING in writing. I have had several disappointments because I was misled by others along the way.
In Germany, I took over doing primary care and procedures. Military medicine takes some getting used to but once you get it down it can be pretty enjoyable. About 6 months after I arrived in Germany I got orders to deploy with a unit in Germany (2/2 SCR) to Afghanistan. If possible they will have you attend their 3-4 week train-up held in Germany, Louisiana, or California about 3 months prior to your deployment. As a physician, you are required to report to your unit (usually not located at the same base as you) about a month prior to your deployment and they can keep you for up to 3 months after. Most units, however, release you within two weeks. Which means that your deployment is actually longer than the rest of your unit’s is. Also, numerous physicians failed to receive payment for housing during the pre/post deployment periods which can be financially quite taxing. If you are joining the Army you can count on deploying for 9 months within one year of graduation from residency. [Everything in this paragraph is Army-specific and your experience will vary in the other services. One nice thing about deployment is pay. Most of your pay (except bonuses) is tax-free while deployed and you receive several other pays like family separation pay ($250/mo), hazardous location pay ($100/mo), combat pay ($225/mo) and per diem ($3.50/day). In all it means that while deployed you make about $1600 more a month after taxes. [Of course, if you were moonlighting prior to deployment, your pay may actually go down while deployed.-ed]
17. Would I Do it Again?
That's a really hard decision to make. There are a lot of variables.
First, there is the money. The scholarship is worth twice what it was when I joined (we had no bonus and were paid $1000 less a month). The military will pay you at least $20,000 more a year in residency than the civilian side which is a really nice feature [While the military still pays more, the difference is decreasing as residency pay has been climbing the last few years.-ed] However, they will pay you at least $35,000 less (as a family doctor) per year then you would make as a civilian. That's over $120,000 in lost pay. However, you add in the scholarship value and the extra pay in residency and you do come out significantly ahead IF YOU DO PRIMARY CARE.
Second is lifestyle. I would likely have never had the opportunity to live in Hawaii or Germany had I not joined. I have visited a lot of Europe for very cheap due to living there. The Army has great free healthcare and provides a lot of discounts on many things. That being said, if you were unhappy with your job, your co-workers, or your lifestyle in the civilian side, you could pack up and move. That is not an option in the military. I likely would not be happy with the lifestyle the army has provided me if I had done my residency in Georgia (my last choice) and had my first assignment in Fort Polk (middle of nowhere Louisiana). You don't always have a lot of control over this.
Dr. Ellenbecker enjoying his time NOT in Afghanistan
Third, you should consider family. For the most part, the Army provides fairly well for families but that doesn't make it easy. It is very hard for spouses to find jobs overseas or to uproot their job or educational objectives every few years. For me, family is the most important thing. My wife and I had our first child shortly after we arrived in Germany and I had to leave him for a year when he was 8 months old. That was really hard. We added a little girl to the family after I left the Army and it just cemented in what I missed out on. I have no desire to leave my wife and child again for this length of time. Deployments are long and difficult. We weathered the storm but not everyone does. Civilians get paid A LOT more to do the same job active duty does down range. I was once asked what it would take to do another year in Afghanistan and I said $500,000. The Army isn’t going to pay that.
Finally, think about what you want in a career. Army medicine was for the most part enjoyable for me, but it isn’t for everyone. Army politics and posturing is a constant battle. I have no doubt that I will enjoy my medical career more outside the military then I have inside the military simply due to not having to deal with Army BS. In addition and possibly most importantly, one needs to realize that you have ZERO control over your career until you make Lt. Col. I had a very good friend who upon graduation was stationed at Fort Drum (a horrid location). For 4 months he worked 5 days a week in a clinic setting and a 12 hour (day or night) every other weekend in urgent care. He was not paid more for the extra hours and he was not compensated with off time. He was then promptly deployed to a forward outpost where he essentially provided sick call to about 60 soldiers for a year. Not exactly a good way to start one's career (skill erosion). Upon return from deployment, he was assigned to an admin position and did patient care about 1 day a week for the next 18 months despite asking to move repeatedly. The army had no interest in him maintaining his skills. It’s sad too, as had he had a better early career he probably would have stayed in the military.
Would I do it all again? I don't know. For today's offer probably. Given the offer I had, probably not. The bonus would have helped a lot and my stipend was so low I had to take additional loans just to make rent which I wouldn’t have had to do now. I enjoyed my time, but I am happy to be out as well.
What do you think? Did you take the HPSP Scholarship? Were you glad or were you disappointed? Would you do it again? Did you consider it and turn it down? Why or why not? Comment below!
Updates:
– Average starting pay was pulled from a medical site that unfortunately I can’t remember, it however is PAY, not COMPENSATION (401K, profit sharing, etc). For what its worth, in the DFW area where I live the average starting pay out of residency this year is about 155-160K so my numbers may be off on that.
Great article, thanks for sharing. I started college on an ROTC scholarship. As an army brat, this was like coming back to the womb. I did well, got my jump wings, etc. But I knew that I was going into medicine, so I started talking to a lot of military docs (had good access given my dependent status). I had a hard time finding any that liked their job, and all spoke about the magic 20 year number. One ENT down at Pensacola NAS talked about the unique skill set that he brought, coming to the Navy after all of his training–this allowed him to negotiate a contract that worked for him; basically he could walk away if they tried to mess with him. So, I quit ROTC, picked my medical school, picked my specialty, basically picked my residency, picked my job, paid off my student loans and first house less than 10 years out, saw my baby being born, present for birthdays, etc etc. If I wasn’t fat, happy, and very comfortable, I could always visit the recruiter.
Seams like financially a decent idea for primary care. Does not seam like as good an idea for those that specialize. I almost went that route many years ago. Prior to signing I did the math and realized it was not the right decision for me. I am an emergency physician living in Texas. During my third year residency, I was able to moonlight and raked in another $40K. We were even allowed to do a moonlighting rotation as an elective for 4 weeks.
I’m not sure how relevant my comments will be given that I did my HPSP payback from 1986-1989. At that time, I was already in debt from undergrad and interest rates for student loans were 15+% if I recall correctly. I am in primary care and entered active duty in the Air Force as a Flight Surgeon. We also had to work in the ED 8-12 hours per week, nights and weekends. Overall, I had a very positive experience. I had a good assignment, traveled extensively and learned a lot, not only about medicine, but leadership, how to have a boss etc. There was a fair amount of Mickey Mouse stuff but I was young and pretty flexible. I was also single which made things easier than for my married colleagues. I took as many TDY (travel to other places)opportunities as I could get which made my partners happy. It was peacetime which obviously makes a big difference. When I left active duty in 1989 to start my residency, I thought I was home free. In 1991 I was called to active duty for Desert Storm, but only for a month (in the middle of my residency). After that I was done forever. I agree that students should not do HPSP just for the money but be interested in the military life, as least for a small while. My GMO buddies were pretty miserable, slogging in an outpatient clinic 10-12 hours/day while I was traveling to Europe, Africa and Central America and flying in fighter jets. I guess my assignment, mostly luck, had a lot to do with my positive experience.
It was not until I discovered this website (15 years after finishing my Army commitment) that I did the quick calculation in my head and figured out that for me HPSP did not make financial sense. I’m a private practice anesthesiologist, and could have easily paid off my loans. I was not financially savvy at age 21, so I can’t fault myself for making the decision to go the HPSP route.
While from a financial standpoint it did not make sense, the Army gave me several intangibles that made my military career worthwhile. First, it got me beyond the idea that Chicago and the Midwest were the center of the universe by sending me to Tacoma, Alaska, and Washington, DC. My GMO year in Alaska was excellent from both a personal and professional standpoint. My internship and residency experiences were superb. And there is a certain amount of pride associated with having served in the military. Having served in the military clearly shaped who I have become as a physician and as a person, and in good ways.
Now, I was pretty lucky, and received my first choice for internship, GMO assignment, residency, and post fellowship assignment. The Army even let me defer payback for a year and do a civilian fellowship of my choice. Had I received less favorable assignments I might feel very different about my time in the Army.
Would I do it again? Maybe. That is a tough question to answer when you really don’t need to make a decision. Did I tell my daughter who starts med school next summer to go HPSP? I told her it was an option, and we went over the financial calculation. But it is her decision, and I suspect she will not go the HPSP route.
This seems like a reasonable option for primary care doctors depending on circumstances, but an even better deal for dentists. Dental school, vet school, and in the near future perhaps medical school just don’t make financial sense any more especially with the private schools that traditionally don’t offer very good financial aid packages.
Take USC Dental school for example… http://dentistry.usc.edu/programs/dds/cost-of-attendance/ $426,523 total cost of attendence for 4 years. Add in a bit of undergrad debt and you have some pretty ridiculous numbers for a profession that is going to often force you into pseudo-resident pay at 40-80k/yr for a few years and finally get up into the 150-180k range. For good reason, people in these kind of programs are joining the military in larger numbers than say, ortho surgery MD programs. Another consideration is how likely your chosen specialty is likely to get you deployed. General/trauma surgery and Emergency Medicine seem like high risk fields that could get you sent abroad quickly and spending a lot of time away from family.
Actually in the army the highest deployed fields are in order: Family Medicine, Pediatrics, Emergency Medicine, Surgery/Ortho, and OB-GYN. Your specialty only plays a small factor. I saw a neonatologist get deployed for 10 months as a battalion surgeon. What a waste for both him and his soldiers.
OB/GYN are usually deployed as general surgeons.
Surgeons often get deployed more often but for shorter lengths of time. (3-5 months)
You’re right, I did deploy with a general surgeon…but also with a dentist. Guess who was busier? 🙂
The dentist with whom I deployed was an O-6, while I was an O-3. Guess who had all Sundays and half of the Saturdays off down range, and guess who saw the dental patients on those days? 😉
My wife and I are both dentists and got out of school in ’09 and ’10 respectively. She took the HPSP route, and I took out a bunch of student loans and went into private practice. One thing he touched on but didn’t really get into is as a military doctor, it is next to impossible for your spouse to have a career outside of the military (preferably in the same branch) if you want to live together. I lost count of how many times people told me to “just get a GS or contractor job” where my wife would be stationed, but that is much easier said than done for a dentist/physician. Out of our military physician/dentist friends, the vast majority are getting out when their commitment is done. The few who plan to stay in for 20 years have accepted the fact that as you increase in rank, so do your administrative duties, while the time you spend in patient care decreases. Overall, she pretty much agrees with Dr. Ellenbecker’s sentiment: there’s definitely pros and cons, but you can’t just do it for the money. Despite the many frustrations that led to her getting out of the Navy, my wife is still proud to have served her country and we’ve both made some good friends.
Do you know if there Are there any options to take a commission during residency or as an attending?
There are. You’ll get a much bigger signing bonus (six figures for a dentist last I checked) if they’re not paying for school, but they won’t pay for school after the fact. ie: you can join and get a scholarship before the 3rd year of school, but they won’t pay for the first two years.
Yep, FAP program.
I did take the HPSP scholarship, and as a result was on active duty in the Army from 2000-2008. As alluded to in the article, the financial benefits of the scholarship are now greater than they were when I took it, but the pay gap between military and civilian residencies has narrowed somewhat. The monthly living allowance when I was on the scholarship was ~$900/mo. I went to an expensive, private medical school (cost was ~$180K for 4 years back then.) I wound up specializing in EM. I was selected for residency straight out of medical school- no GMO time. I think without a doubt I wound up financially ahead of the vast majority of my peers who started med school in similar financial situations, and went into the same specialty. This is despite making roughly 50% of what my peers were making as new EM attendings during my payback years (the army paid me on the order of $140K/year then.) The main factors affecting this were- 1. being debt free on graduation, 2. maxing the TSP contributions every year when I was in the Army, 3. moonlighting in civilian ED’s when I was allowed to, toward the end of my time in the Army, 4. tax benefits of military service, such as tax free allowances and tax free pay while deployed, and 5. absolute, steadfast commitment not to spend money i didn’t have at any point, which meant living on $200/mo in med school after housing cost.
Though financially, I think HPSP is still a great deal if you are not from a wealthy family and plan on attending an expensive medical school, clearly finances are not the only consideration, as Beau has mentioned. I wound up spending about 5 of the first 6 years of my marriage away from my wife (who is also a physician, and was doing her civilian residency training at the time.) It is amazing that our marriage survived it, but it did. If you have a spouse or serious SO, I would strongly consider whether they would be able to follow you to your assignments (as mine was not.)
Also, as mentioned in the article, there are different pros and cons of each branch of service. Although the AF and Navy have by-and-large better places to be stationed, and more pleasant deployments, the Army is clearly the leader when it comes to reliably getting you into GME in your field of choice with little or no GMO time. If you have to GMO, and then go back for residency, it could really put a damper on your professional and financial plans. These may hinge on minimizing your time in service, especially if you are in a specialty with a wide military-civilian pay gap, such as EM.
WCI as well as several posters have eluded to moonlighting and how it could affect your finances in the military. I really didn’t get into this as it was never an option for me.
The Army severely restricts moonlighting during residency (in fact at Tripler it was forbidden). After residency I went to Germany so it wasn’t really an option for me but could have been for those in the states.
My husband applied for the HPSP scholarship TWICE and was told no both times and there are moments when I am so thankful for that. His private school loans are INSANE (tuition about $42k and living expenses around $26-28k annually) and the interest rate is somewhere upward of 8% BUT we’ve continued to look in to programs like NHSC and the state of Virginia’s repayment program so there are options. I think any way you roll the dice, unless you’re fortunate enough to have someone pay your tuition/living expenses out of pocket, it’s stressful and daunting.
I’m curious to see how we’ll be able to manage loan repayment once he starts residency next July.
Dr. E, Thanks for the picture of Army life.
I’m in my 6th of 6 years of active Navy duty, which is one more than originally obligated after accepting HPSP for, at the time, the most expensive MD school. Although I will be leaving earlier than many of the Army and Air Force counterparts, I am not yet residency trained (though, nor did I deploy in a role outside of my specialty). I think Dr. D has provided a good review of financial advantages in an old post, but I’ll provide some examples of how I have been able to utilize the financial opportunities to my advantage.
1) Max out Roth IRA for all four years of medical school and six years of active duty. (W-2 Income from the “Stipend” during school, and below the phase outs during payback).
2) Spousal Roth IRA for the same amount of years other than the first year of medical school.
3) Maxed out Roth TSP for last three years and half of the first available year for Roth TSP while still only paying %15 marginal federal rate.
4) State Tax Free Spousal Income (Due to Military Spouse’s Residency Relief Act)
5) State Tax Free Income (Many, if not most, states do not tax military income)
6) VA Home Loan (No $ Down Payment Required)
7) Will Use Montgomery GI Bill for Residency (~$20,000/yr tax free for 3 years of education (residency qualifies) after $1200 initial payroll deduction +$600 subsequent deduction).
Despite all of this, I still agree that the “scholarship” (a misnomer) should not be pursued or accepted merely for the financial aspects. Cheers.
How do you use the GI Bill for residency? Most residencies are not run by schools but by hospitals…
I assume you can only use it toward housing as their isn’t any tuition/fees/book “required” for residency.
Just curious.
I wish I would have had any financial knowledge in school as I probably would have started a Roth in college and continued through med school. I didn’t start until my year of residency. Probably have 70-80K more by now…..
Beau,
Dr. D had another guest post about this here: https://www.whitecoatinvestor.com/using-the-gi-bill-to-boost-residency-pay-guest-post-military-physician-series/
and another website that provides good guidance is here: http://militarymoneymanual.com/quick-guide-to-the-montgomery-post-911-gi-bill/
Essentially, residency programs are classified/certified as educational institutions by the VA. The housing portion would apply to someone using the Post-9/11 GIB. The MGIB is directly paid to the student, i.e. resident.
For those students/residents out there considering the invest or pay down debt decision, I can’t tell you what to do, but I can say I have benefitted greatly by investing, especially since graduating medical school in 2009 market bottom.
Beau,
My earlier response was filtered out because I tried to include some links, but, essentially, the VA classifies residency programs as ‘academic institutions’ even though they are not schools, strictly speaking. The GME offices have the VA certifying official, who assists with the paperwork. The main benefit of post 9/11 bill is tuition payments directly (less applicable for residency) and of Montgomery GI bill is direct payments. This comparison is the topic of another guest post from 2012.
Hope this answers the mail!
They just cut you a check as I understand it. Toward living expenses.
How many physicians do you think will get called up with the 3000 troops to fight Ebola?
Probably none. It doesn’t take very many docs to take care of 3000 troops. The military certainly doesn’t have to pull docs from residency or from inactive ready reserve status for something like that. I do believe they pulled some for Desert Storm though.
I am pretty sure they have never pulled someone from residency (except the Navy). I am also fairly sure they never pulled from the IRR since Vietnam either, however I know they did stop-loss people from leaving the service at the end of the commitment, often adding 6 months to 1 year to their service time.
Funny thing about military contracts, they will definitely hold you to yours but their side really means nothing. Its all subject to change.
I don’t have a good source, but I’ve been told quite clearly that IRR was used in Desert Storm. I’m not as sure about the residents, but someone also told me that. At any rate, it’s certainly a risk, even if it is a low one.
Thanks for the article. I am just starting my dermatology residency this next year so I wanted to create a budget of what the next several years would look like. I attach the link in case you want to share it with your viewers. I think sometimes it helps to see it in front of you in order for it to make sense. Here’s the link – Hey Bart,
I’m sending this to all the new derm residents but you might find this helpful. I made a spreadsheet that breaks down everything we will make during our residency and payback time. I put in some cool features that makes it easy to edit and keep the monthly totals. I also used the projected 2015 pay-scale and incorporated the 1% average pay increase each year. Check it out and feel free to download it and change it according to where you live and your prior experience. https://docs.google.com/spreadsheets/d/1mcHBDO46YaDBCCo3KlotiG_LYp9TFrPfWKkLGM3W574/edit?usp=sharing
I give talks to entering medical students about scholarships, and the HPSP always comes up. It’s great to have a post and site like this where I can refer students. Giving students the opportunity to read the perspectives of people who have “lived it” is fantastic. Thanks for sharing your story. Here’s a link to an article about the HPSP which compared medical school debt and salaries of military, academic, and private practice neurosurgeons:
http://www.ncbi.nlm.nih.gov/pubmed/21441836
Interesting paper, thanks for sharing. The military scholarship makes little sense (financially) for someone who may be able to make $721K in private practice. What I found surprising was that many of those docs still had debt. One nice thing about the military scholarship is you don’t have the opportunity to make stupid decisions about your student loans, because you don’t have any!
is there a similar blog post about the military medical school USUHS?
Not yet, want to contribute one?
Another program to discuss is the Health Scholarship Collegiate Program (HSCP).
Originally only offered to dental students, as of 2007, it is now offered to prospective physicians. The program pays the student a E6/E7 salary (including BAH), offers all other military benefits (Tricare for the entire family, etc), and includes years toward retirement and pay. So essentially a 4yr recipient could come in as an O3E w/ 4 years toward pay and retirement and then retire at “20yrs” having only served 16 post-medical school. The catch is the money is capped at E6/E7 salary. If you go to 40K/yr school the deal my not be good, but if you go to an inexpensive state school w/ tuition less than 20K it may be something to look in to especially for anyone with prior military service.
I can try to but you’d probably want to edit it since I sm a bit of a financial dummy
No one mentioned the option of finishing up ones career at the VA. Now they have competitive salaries and you can buy your military time towards retirement. This made my HPSP time and payback time a valuable investment towards a VA pension.
Do you know if you can switch to a DPT Doctorate of Physical Therapy Degree program from medical school and cont8nue to use your HPSP scholarship ?
I suspect not. I bet if you leave medical school it all becomes due and starts earning interest. They’re buying a physician, not a PT. But you can call the military and ask. Post their response here, I’d be interested.
Thank you for this post!! I accepted the HPSP scholarship and am starting school in a few days, and even today I am still very confused about what I just signed up for (in spite of my personal desire to serve), mostly from a financial perspective. I am trying to understand how the Roth IRA/TSP works, with the contributions. I currently have 2 very small 403-bs from my previous jobs, and wanted to continue contributing into a retirement plan somehow, but I am trying to find out how folks were able to do that with their monthly expenses.
Also, in terms of specialties and assignment/deployment, I had a question. My worries post med-school are that I will end up either getting deployed over and over (if I went, say the route of one of the specialties named in the comments above), or I will end up not being able to use my training (if I end up in a place where my skills are not useful). I know some people mention reassignment, but how often does that get approved? Or is it usually a “make do” kind of thing?
Finally, in our application we had to write down 3 locations we wished to be assigned to (I am assuming after residency). Are these set in stone? I currently have no anchoring obligations or anything, but one never knows what will happen down the road. Is that something we will get asked again after school or something we can call up and ask to change? Or was that just a formality for the initial application (I know these are questions for my recruiter but given the ‘Rona responses are not quite forthcoming).
Thanks again for helping newbies like us navigate this thing!!
They’re able to do it by living very frugally.
Deployment ops tempo depends on what is going on in the world. No way to predict it 7+ years in advance.
The military will find a way to use your training, whether you’re a trauma surgeon or a dermatologist. You usually only have to “make do” during a deployment.
Not sure what to make of those three locations in an HPSP application. They probably have NOTHING to do with future locations. I doubt anyone will look at that application in 7+ years when it is time to make your first attending assignment. You will fill out a wish list then that they will look at but don’t hold your breath. I was offered a choice between my # 15 (last) and a place that wasn’t even on the list. So I guess a formality because whoever made the application didn’t bother making a doctor specific one.
Thanks for serving.
Do you receive MASP and ISP while serving your initial ADSO after residency? The verbiage here (https://militarypay.defense.gov/Pay/Special-and-Incentive-Pays/Index/#302a4) makes it seem like the MASP and ISP are only granted if you sign additional years of service in addition to your HPSP-ADSO, is that right?
You get VSP and ISP while paying back your commitment. If you stay longer, you get MSP too.
Bear in mind my info is 10 years old, but I don’t think it has changed.