Healthcare educational debt in the united states: unequal economic impact within interprofessional team members

Abstract

Background: Advancing healthcare access and quality for underserved populations requires a diverse, culturally competent interprofessional workforce. However, high educational debt may influence career choice of healthcare professionals. In the United States, health professions lack insight into the maximum educational debt that can be supported by current entry-level salaries. The purpose of this interprofessional economic analysis was to examine whether average educational debt for US healthcare graduates is supportable by entry-level salaries. Additionally, the study explored whether trainees from minoritized backgrounds graduate with more educational debt than their peers in physical therapy.

Methods: The study modeled maximum educational debt service ratios for 12 healthcare professions and 6 physician specialties, incorporating profession-specific estimates of entry-level salary, salary growth, national average debt, and 4 loan repayment scenarios offered by the US Department of Education Office of Student Financial Aid. Net present value (NPV) provided an estimate for lifetime "economic power" for the modeled careers. The study used a unique data source available from a single profession (physical therapy, N = 4,954) to examine whether educational debt thresholds based on the repayment model varied between minoritized groups and non-minoritized peers.

Results: High salary physician specialties (e.g. obstetrics/gynecology, surgery) and professions without graduate debt (e.g. registered nurse) met debt ratio targets under any repayment plan. Professions with strong salary growth and moderate debt (e.g. physician assistant) required extended repayment plans but had high career NPV. Careers with low salary growth and high debt relative to salary (e.g. physical therapy) had career NPV at the lowest range of modeled professions. 29% of physical therapy students graduated with more debt than could be supported by entry-level salaries. Physical therapy students from minoritized groups graduated with 10-30% more debt than their non-minoritized peers.

Conclusions: Graduates from most healthcare professions required extended repayment plans (higher interest) to meet debt ratio benchmarks. For several healthcare professions, low debt relative to salary protected career NPV. Students from minoritized groups incurred higher debt than their peers in physical therapy.

Keywords: Allied health occupations; Debt; Economics; Education; Ethnic and racial minorities; Health workforce; Interprofessional; Minority groups; Salary; Sexual and gender minorities.

Fig. 1

Salary change and present value (PV) for healthcare professions. A) Entry-level salary change (2012–2021): the dashed line depicts all professions in all economic sectors ($7,470). B) 10-year compound annual growth rate (CAGR) of entry-level salary: the dashed line depicts all professions in all economic sectors (2.91) and the dotted line represents the compound annual inflation rate (CAIR: 1.41). C and D) Present value (PV) analysis of healthcare professions, modeled with less-conservative (C) and more-conservative (D) discount rates

Fig. 2

Doctor of physical therapy (DPT) degree cost and PT career present value (PV). A) 10-year trends in total cost of the DPT degree, compared to growth in entry-level PT salaries. B) 10-year compound annual growth rate (CAGR) for total cost of the DPT degree versus entry-level PT salaries. The dotted line represents the compound annual inflation rate (1.41). C) Present value (PV) of a career in PT at several tiers of total educational debt, modeled at a 5% discount rate. Horizontal lines indicate when the PV of a career in PT falls below other healthcare professions, culminating with no PV difference from a bachelor’s degree with $230,000 in total educational debt

Fig. 3

Physical therapist student debt for minoritized groups. Racial and ethnic minority (REM), sexual and gender minority (SGM), and socioeconomic disadvantage (SED). All values include individuals with $0 scholarship / debt. * = Significantly different from non-minoritized group; § = significantly different vs. Asian; † = significantly different vs. White