Student debt drives medical graduates overseas

Medical students are being saddled with ever increasing debt and most believe hospital management won't think much of them as employees once they start work.

A new study has found medical graduates rack up debt of about $75,000 each by the end of their training - an increase of more than $10,000 on four years ago.

And the high debt level is the prime motivator for students planning to leave the country either immediately after graduating or by the end of their second or third year after graduating. Australia was most likely to benefit from the Kiwi expertise going offshore.

The study, published today in the latest issue of the New Zealand Medical Journal, was undertaken by William Perry, immediate past president of the New Zealand Medical Students' Association and a doctor at Christchurch Hospital.

Perry, whose own student loan is $110,000, surveyed senior medical students to explore the effects of student debt and to define what was important to them as they made decisions about where to work and live after graduating.

The findings showed an average medical student graduated with a debt of $75,752 with 64 percent of survey respondents saying their debt would influence their choice about where they would work in the world.

Financial incentives were most commonly cited as the reason to work overseas or to locum.

However, debt was not the only factor influencing what medical students choose to do on graduating.

Perry also discovered that just 25 percent of students believed they would be valued as employees by hospital management or the Government.

''This is not only disappointing but has significant implications as those who felt undervalued were more likely to opt for low-commitment high-paid locum jobs,'' he said.

Perry said debt levels needed to be countered and the perceived lack of value of graduates rectified. The Government and hospital management groups needed to explore ways to improve perceptions of being undervalued as the survey results had implications for specialist training and long-term commitment to New Zealand.

Perry acknowledged there had been moves to recognise the importance of debt with an increase in the trainee intern grant, the introduction of interest-free student loans and a voluntary bonding scheme but said there had been little work done on how the changing nature of the training environment had impacted on medical students' perceptions about working and training in New Zealand.

''It is important we focus on medical graduate retention, and the recruitment of New Zealand graduates who have already gone overseas. Our graduates will have a drive to gain wider experience and this is ultimately beneficial to the New Zealand public. They should not be punished for gaining this experience but rather encouraged to return."

Perry said medical graduates knew their debts were not impossible to pay off but people also wanted to do other things such as buy a home or start a family, and therefore explored avenues to pay their loan off faster.

Addressing debt and bigger financial incentives could also reduce the number of locum doctors who "absorb an alarming proportion of this country's medical workforce expenditure".

The survey follows a study by the New Zealand Association of Salaried Medical Specialists that found half of all medical registrars in their final year of training go overseas - often lured to Australia where pay differences can be as much as $70,000 a year.

Health Workforce, a government agency set up to address health workforce needs which was working on several programmes to address the issue of doctors going overseas.

Chairman Professor Des Gorman said while he was sympathetic to the level of debt incurred by medical students, they needed to remember that the taxpayer was funding 80 percent of the cost of their education as well as paying interest on student loans.

''We have a very good idea of the concerns of med students and are addressing them systematically but we've got to look at it so they and the taxpayer benefit. At the moment we spend a fortune on training people and then they're free to go and do whatever they want. I would suggest that's a reckless use of taxpayer money.''

Gorman said New Zealand was losing 35 percent of its doctors permanently and he planned to cut that to 15 percent within two years.

Measures to achieve that included co-ordinating a doctor's overseas experience by managing their placement in appropriate institutions and supporting them while they were away to ensure they returned.

- © Fairfax NZ News