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New York medical school eliminates tuition after $1B gift

chenxi9649
61 replies
19h52m

This entire story is just so heart warming and I don't know if the title/discussions right now are doing it justice.

1. The fact that this donation is 100% going towards tuition. My university has a few B's in endowment, but those money are most definitely not going towards making the tuition fees lower lol. Hopefully this will allow them to select some candidate that are struggling the most financially...

2. The donor being a 93 year old doctor/alumni of that school that studied "learning disabilities and developed screening protocols".

3. The money was from her late husband's "whole portfolio of Berkshire Hathaway stock". And before he passed, he told her to "do whatever you think is right with it" and the article ends with her saying "I hope he's smiling and not frowning". Makes me cry a little.

madsbuch
50 replies
10h54m

... I don't know if the title/discussions right now are doing it justice.

I grew up and did my education in Denmark. Here we have another sentiment on philanthropy than the anglo world has. Generally I don't like when a single person decide the destiny for many people, as in this case. It as anti democratic and concentrates power.

Stories like these are heartwarming indeed, but they also help keep status quo. In a more fair world a person should probably not be able to amass more than USD 1B by making the right bet on the stock market. That wealth is build in this way is anti-meritocratic.

Stories like this highlight an interesting paradox of the anglo world: The relationsship between democracy and large scale individual impact and the relationsship between allowing people to make their own wealth while the really rich people are merely early, passive, investors.

(It is hard to write critical comments like this when "The donor being a 93 year old doctor/alumni of that school that studied "learning disabilities and developed screening protocols"." - I hope you can forgive me.)

4wsn
32 replies
10h26m

In a more fair world a person should probably not be able to amass more than USD 1B by making the right bet on the stock market. That wealth is build in this way is anti-meritocratic.

It's anti-meritocratic for someone to invest their money intelligently in the stock market?

How do you determine the threshold where on one side they're entitled to the wealth they earned, and on the other side their wealth is unfairly earned?

mateo1
14 replies
9h52m

How do you determine the threshold

I think most people will agree the threshold to be in the few millions. Some will argue for 5 and few for 50, but nobody can produce $1B of value. Take control of it, sure, but produce, no.

6510
11 replies
9h24m

Apparently they can by giving it to the right entity at the right time.

What we could do (besides taxing it away) is configure a limit to what they are allowed to do with it.

I also see room for special titles with cosmetic privileges if someone accomplishes to pay the enormous tax.

It will be hard to find the right privileges. Something like a medal or an outfit is obviously doable. An annual fancy dinner for the group doesn't seem over the top. A daily 30 min slot on the TV for them to bid on exclusively, or each their own slot annually. Can grant 3 lectures in any university. It gets slightly dubious if we add special construction permits for locations no one else may build in.

The funniest I could think of, at 10 bl+ we seize all of your money and assets, you are forbidden to participate in the financial system. You get a robe and a cloak and a card with which you can eat any place, stay at any hotel, buy cloths, do shopping, take a taxi and take any flight with a maximum of 3 guests + partner and kids.

madsbuch
8 replies
8h16m

Apparently they can by giving it to the right entity at the right time.

I want to understand this. If I buy a Novo Nordisk share on the market I never gave novo nordisk a single krone. My counter part is the seller (who rarely would be the company itself).

Generally I would say that investors provide liquidity to the market. Ie. the action of buying and selling are the ones that provide the value. Not holding.

You can conclude that a person holding onto a share for 30 years did not provide any value. That person was merely a rent seeker based on other people providing value by doing the asset allocation – In Denmark these people would be punished by the progressive capital gains tax, while the people trading ones in a while would benefit from a lower tax bill.

Or am I wrong?

sokoloff
6 replies
6h24m

If I give Novo directly $125 for a share of their stock, sell it 30 seconds later to you, who gives me $125.01, and you hold those shares for 30 years, which one of us really invested in Novo? Does your opinion change if we've agreed the night before that you'll buy the share from me?

I believe the long-term holders of equity investment are the true investors, regardless of whether they bought the shares in an initial offering or a secondary offering.

The initial offering market doesn't exist without the secondary market.

madsbuch
5 replies
5h58m

I am talking about the value you provide as an investor - regardless of where you got the share. I agree that it is indifferent whether you buy it from the company (in an IPO or in later emissions) or on the secondary market.

My point is that the value provide is liquidity. Ie. the property that owners of a stock con transfer that stock into money to use on other ventures. People that merely hold a stock does not provide liquidity. You need to have an open order on your stock to do that.

Now, please oppose me! My question is: What value to does term holder provide in virtue of them being long term holders?

sokoloff
2 replies
5h54m

They have (transitively) provided the company the original $125 to use in their operations.

In that example, you provided the money; I was just a middle-man.

Except as it pertains to employee/executive comp and future fund-raising, the company doesn't care about the secondary market liquidity. They care about the money they used over that 30 years to grow.

madsbuch
1 replies
5h27m

They have (transitively) provided the company the original $125 to use in their operations.

But that value already existed as an intrinsic property of the company (eg. NAV). What the market did was to unlock these money for the company to use - Ie. they provided liquidity.

Example: I have a company that is worth $1000, but I need to spend $200 in R&D. I sell 20% of the company in the market for 200$. No value way produced, but the market transformed my 200$ from company to money - ie. liquidity.

Value that only happens when people trade, and not when people hold. So back to my initial point: Long term investors does not provide value.

sokoloff
0 replies
5h11m

I have a company that is worth $1000 / that value already existed as an intrinsic property of the company (eg. NAV)

Upon what is this based in a world where no long-term investors exist?

Even in the "DCF of dividends plus NPV of terminal enterprise value" model, the last is dependent on long-term investors. (For the high number of tech and high-growth companies who pay no dividends, the first term in the valuation is $0.)

mlrtime
1 replies
5h13m

All of your questions can easily be understood by a few minutes of investopedia. Start by reading about "Capital Markets" and then risk transfer.

You start the thread saying what people ought to do with their money and presumably having it forcefully taken with little understanding of financial markets. This is [one reason] why nobody takes these suggestions seriously about personally wealth.

madsbuch
0 replies
4h41m

All of your questions can easily be understood ...

Then you should be able to make a well informed comment on the matter, as you clearly understand it.

This is [one reason] why nobody takes these suggestions seriously about personally wealth.

What suggestions? Capital gains tax? I only know of very few industrialised countries not enforcing capital gains tax. So that idea is most certainly taken serious.

You start the thread saying what people ought to do with their money and presumably having it forcefully taken with little understanding of financial markets.

Can you expand on this? Having money "forcefully taken" is a core feature of modern efficient markets whether you like it or not.

6510
0 replies
1h12m

I want to understand this.

I certainly don't understand but there is no need. The mechanism (provided it is legal) isn't really important.

We need work, to earn enough to survive and have some quality of life. It must feel like you've contributed something useful and society rewarded you reasonably for it. Others will have to do work for you or it wont work. If there is no money for that it cant work.

I think 100 years before things get truly silly.

vineyardmike
1 replies
8h16m

This reminds me of ancient Athens. The rich would all compete to pay taxes, because your social status was based on your taxes, and you had special perks if you paid enough. It became a bragging opportunity to showcase your wealthy.

If you funded something with your taxes, you could hire the artist that made the sculptures. Say you build a new civic center with a theater. You have an incentive to hire a good artist to make the place in your preference, with your image, which means the city has more art. If it was an ugly building, it’d be an ugly building with your name on it. The rich during times of war would be separated into those that could fund a whole battleship and those that didn’t. If you shirked your responsibilities during war, you were viewed as a traitor who was so greedy they’d let the city fall.

Maybe we need to stop chastising the rich for building things in their names, but instead give them more opportunities to do so. Additionally maybe we should make all tax payments public, so you can see if your friends and family avoid taxes. Maybe people would become embarrassed to pay less taxes than their employees if everyone could look it up.

rblatz
0 replies
3h21m

”... he didn't pay any federal income tax.”

“That makes me smart.” - Donald Trump

edanm
0 replies
5h12m

I think most people will agree the threshold to be in the few millions. Some will argue for 5 and few for 50, but nobody can produce $1B of value. Take control of it, sure, but produce, no.

That is just, on the face of it, false. Did Stephen King not produce millions and almost a billion in value? Despite writing books that have been read by millions of people, have turned into super successful movies, including some movies considered some of our best art?

RestlessMind
0 replies
41m

JK Rowling surely produced $1B of value. Much more in fact.

JohnKemeny
6 replies
9h50m

It's about putting an upper limit to the amount of resources a single person is allowed to amass and thus control.

We agree that we don't want a dictator. A single person with too much wealth can be almost as powerful, hence there are good arguments in favor of setting such limits.

edanm
4 replies
5h14m

And yet many people have far more actual power over people's lives, for example many elected and/or appointed officials.

If a cop in my city wants to ruin your life, there's a chance it'll be easier for them to do so than it is for a rich individual, not to mention the mayor of the city.

And unlike a billionaire, who'd have to spend money to actually "control people's lives" and is therefore limited by some constraint , an elected official gets to control people's lives with no constraint at all.

tijtij
1 replies
1h59m

What if the cop wants to ruin the lives of a large group of people? How about if it's a group people living in the next town over, can he get away with it? If he does manage to ruin the lives of people, will he get voted out or dismissed?

Bill Gates improved the lives of countless people around the world. He could as easily made the lives of countless worse if he wanted to or as an unintended consequence of his projects.

edanm
0 replies
1h4m

He could as easily made the lives of countless worse if he wanted to or as an unintended consequence of his projects.

As an unintended consequence, sure, but that's more true of scientific/technological progress specifically than what Bill Gates did, which was closer to business and tech popularization. If a scientist invents a super-virus that kills everyone, then yes, obviously, they've made the world worse, but that's not really tied to money.

As for "as easily" making countless lives worse in other ways - I kind of disagree there. He made countless lives better because people voluntarily bought his products. He didn't coerce people, they chose to do it. There's no analagously easy way to spend money to ruin people's lives, and especially not if you consider the kind of scrutiny and backlash he'd receive.

madsbuch
1 replies
2h26m

This is a straw man: A police man can only ruin so many lives. He would have to be Santa Claus in order to harres the entire population of the US.

A policeman does not have the same impact over peoples lives as, eg., Jeff Bezos.

edanm
0 replies
1h3m

A policeman in my city could arguably have more impact on my life than Jeff Bezos does. What kind of impact do you think Jeff Bezos has exactly?

And obviously, a policeman is the lowest-power individual in this scenario - my city councilman probably has more impact than that.

nec4b
0 replies
2h24m

Michel Jordan or Bill Gates are almost as powerful as Putin?

madsbuch
5 replies
9h28m

It's anti-meritocratic for someone to invest their money intelligently in the stock market?

I like how you threw in the word "intelligently" like this investments was planned and thought out from the beginning ;)

Thresholds are are not that hard to decide: It is about taxation that takes macro-economic behaviour and targets into account.

We have a political party that wants to reduce capital gains tax in Denmark (currently 27%/42%). However, analysis shows that this would benefit only the wealthiest 2% so the consensus is that this is a bad idea from a macro economic perspective.

The value of money is relative. Your 1 million dollars are worthless if everyone else has 10 million dollars. The second people act upon and realise that, we can start to build good economic systems.

lobocinza
4 replies
5h18m

Macro-economy shows that EU is doing wrong as US companies outperform EU companies. Wealth/power concentration isn't due to capitalism but due to human nature and society scale.

Even if success greatest factor is luck it still requires merit. By punishing success you're punishing people that put money into savings, that attempt to innovate and improve human society, that invest in promising areas. In the long term society will be stagnant. And I doubt that in the short term society will be more equal because forced distribution of wealth historically increases inequality.

wokkel
3 replies
4h14m

Maybe companies, but they are not what should matter. As far as know the amount of poor people in the usa is also way higher than in Europe. If we take that into account i'd say that Europe is doing just fine.

lobocinza
0 replies
42m

If we take that into account i'd say that Europe is doing just fine.

If things are so good why Europe is being dominated by authoritarian populists?

jganetsk
0 replies
3h41m

As far as know the amount of poor people in the usa is also way higher than in Europe. If we take that into account i'd say that Europe is doing just fine.

Citation needed. No, Europe is not doing just fine. https://www.noahpinion.blog/p/americans-are-generally-richer...

RestlessMind
0 replies
39m

Wasn't it just last year that the richest man and the richest woman in the world were both French? A statement at "Europe" level is far too generic, especially when it comes to economic policies or quality of life. Europe includes both Norway and Moldova and the variance in the quality of life is much higher than Massachusetts vs Mississippi.

scotty79
2 replies
6h24m

It's anti-meritocratic for someone to invest their money intelligently in the stock market?

Absolutely. To achieve such results you need so much luck and such a headstart that any merits you might additionally have are drowned in everything else that contributes to "your" "success".

How do you determine the threshold where on one side they're entitled to the wealth they earned, and on the other side their wealth is unfairly earned?

Rule of thumb. About $10 million.

But it's not about who deserves what. It's about how much influence can society safely let a single random primate have.

The actual number will be determined by the political process. It's a number that seems sufficiently unachievable for 51% of people so that they feel safe to vote to heavily tax those who hace that much.

Current barriers to that is that the very wealthy own the culture and they are selling poor people the illusion that everybody can be the rich and what they are doing is actually building value not extracting it despite the fact that trillions of dollars have been extracted from the control of democracy and market and placed exclusively in their hands.

lobocinza
0 replies
5h43m

Rule of thumb. About $10 million.

It's difficult to quantify but many government bureaucrats hold much more power than that.

Your "solution" replaces one problem with a worse problem while punishing sucess.

edanm
0 replies
5h10m

But it's not about who deserves what. It's about how much influence can society safely let a single random primate have.

You are severely overrating how much influence $10m buys you, and very severely underrating how much influence you can have without personally having $10m dollars.

Brian_K_White
0 replies
1h1m

"It's anti-meritocratic?" Yes.

"How do you determine the threshold?" Somehow.

It doesn't matter how you determine it or what you end up determing nearly as much as doing it at all by any means, and working out good procedures and results over time.

Currently, we have nothing at all. A sub-optimal limit, a downright wrong limit, derived from sub-optimal, downright wrong methods is better than none at all.

The Bezoss and the Musks of the world are not doing anything we need done badly enough to be worth what we give them.

Those people who like to run big projects will still be full of themselves and still seek to be in charge of everyone else and will still command the same resources even in a world where that isn't expressed as personal private ownership of the resources.

If the change in incentives changes anything, if there are people who currently became billionairs and produced Amazon and Facebook, who would not have bothered if they couldn't own it all, I am prepared to call that only a win.

We'd still get anything that was actually valuable to us rather than just valuable to the owner.

The only problem is needing to incorporate enough ownership and capitalism so that there is any motivation for excellence. If everything is purely communist and no one owns anything, then all products and services suck. There does need to be some sort of reward for making the electric car and the charging network actually good, and some anti-reward for not making it available to everyone. Patents and copyright need to be somehow quite different. Maybe they still exist and confer some sort of benefit, but nothing like now. Rewarding people for inventing or improving things only to let them keep it for themselves, and even retain ownership control through drm and software over products that were sold more than nullifies the value of getting them to invent the thing in the first place. More than merely negates. Their existence suppresses everyone else who might have done it differently.

Where is the line and how do you determine it is no conundrum at all. It's nothing but some boring policy grunt work to hash that out.

okr
5 replies
8h41m

In a fair world i can keep what is mine and can do with it, what i want. If its well earned, so be it.

In an unfair world it is taken away from me.

It is just numbers.

kungito
2 replies
8h23m

"Fair" has many meanings. If there are 2 brothers, one super intelligent and the other retarded, should the smart one keep all his money for himself and the dumb one die from starvation since he is not capable of sustaining himself? The smart one got his gift for free and although maybe he didn't waste it while he could have, the retarded one didn't have equal starting ground.

The difference I see between US/EU worldview is that in US the biggest emphasis is in what "YOU" did, disregarding luck, chance, environment factors etc. "Bill Gates created the wealth himself". People like feeling like there is a chance for them to become super powerful and important and that there is no system holding you back, even though they never actually do it but the hope/idea is very important for you. I can see this in Eastern Europe where large percentage of people dream of winning the lottery; I guess that is something from which people here draw hope of power and influence, while the same people are ok with strong social measures, high taxes, free healthcare etc. while I feel in US all these social benefits are perceived to prevent people from achieving astronomical results and hence shouldn't be.

okr
1 replies
4h14m

Good is, if brothers help each other. In general, if humans help each other. But it is the brother's decision to help. Fair.

Unfair is, if someone else grabs the stuff of the one brother and gives it to the other.

kungito
0 replies
2h42m

Well some of us think the smart brother got lucky and so he HAS to give

madsbuch
1 replies
8h24m

This is unfortunately an uninformed opinion that pollutes the debate.

An example you probably should should think about: Who owns money and their value? What happens when the central banks decide to raise the interest rates to 20% and you loose everything? Just a shame? On the contrary, what happens when the central banks employ quantitative easing and that makes you rich? How does this interact with large-scale projects the government starts to create employment.

Not always are fiscal and monetary policies aligned. This creates either severe depressions or economic bubbles.

When an opinion is funded an understanding of to what extend the greater society defines the value of things it will have gravity. Until then, it is just noise.

okr
0 replies
3h59m

So, if someone says, billionaire is bad, that is an informed opinion, but when someone else says, billionaire is good, it is uninformed? Thanks for the fish.

You pay for stuff in the supermarket, you get a product. No strings attached. I would be surprised, if people like the idea, that if one buys a piano, that for each song being played, one has to give a dividend to the piano manufacturer. Usually the transaction is closed. Though, such deals can be made. Maybe you get the piano for free.

You pay a worker that what you think is needed to make a piano. If one worker makes a billion pianos, you pay him a lot. And if you sell pianos a billion times, you become a billionaire. And if your worker can buy stocks, he will also get dividends.

The idea that billionaires have to give a share is nice and good, definitly good for hackernews stories and their socialistic readers, but that the billionaire has already given societies wealth manyfolds, well, afterall people bought their stuff to improve their lives, that made him a billionaire, that is silently forgotten.

As usual, it is play with envy and greed, how dare someone has more than me!

nroets
3 replies
10h0m

Isn't it inevitable that one person will decide the fate of many ? If we get rid of billionaires through wealth tax, then politicians will have more power to decide the fate of many.

The US seem to choose their presidents not based on policies or track record but rhetoric. That doesn't seems better than capitalism.

scotty79
1 replies
6h8m

Politicians go through a voting process. People needs to agree to be ruled by them.

To become a billionaire you just need to be lucky enough to purely mechanistically attach yourself to a market phenomenon and drain it. Noone needs to agree to that.

lobocinza
0 replies
5h38m

This market phenomenon is people voting with their wallets. It is also democratic.

madsbuch
0 replies
9h24m

The US political system is another discussion.

Again, as an EU citizen, the two party system seems to be wildly un-democratic. In Denmark we have 10 parties represented in the parliament (in a country of 5.5million people). This forces decision making to be compromise seeking and represent more real opinions.

pera
2 replies
9h54m

I do agree that in a more fair world there shouldn't be billionaires, but at the same time it is curious that from all the stories posted on this website - where billionaires are making uncountable decisions that have a massive impact in our society - this is the only one where commenters would come to express their discomfort towards this fact of capitalism.

madsbuch
1 replies
9h33m

this is the only one where commenters would come to express their discomfort towards this fact of capitalism

Don't conflate an in-equal system with capitalism. That would be untrue and un-wise.

Most people agree that a free market needs to exists in order to uphold a capitalistic system (what is ownership if you can not transfer it?).

You can make free markets that are regulated in a way that ensures that participants are, roughly, equal - in fact there is an argument that a market is not free unless this is the case.

When participants of a market can increase their profit margins it is usually a sign of an ineffcient market - a participant has an advantage that other participants can not compete with.

mlrtime
0 replies
5h8m

Equal opportunity, not equal outcome, right?

shafyy
0 replies
10h30m

I'm from Switzerland / Germany, and thought exactly the same. It's like, great in this specific case that she did this, but boy, are you fucked as a country if you rely on the good will of multi-billionaires to fix your problems.

nec4b
0 replies
2h21m

What would be your plan to limit Taylor Swift's power? Limit the number songs she can write per year?

Brian_K_White
0 replies
1h55m

Yes, both good and bad at the same time, neither overriding or negating the other.

Individual doing a great thing is great.

A system that depends on hoping and begging for miracles is not great.

2OEH8eoCRo0
0 replies
6h23m

I might agree when they donate to push their own agenda but this just eliminates tuition for medical students.

dilawar
4 replies
15h12m

"if you decide to die poor, a great many things can be done with your life". Heard it from a friend whose thesis advisor loved to say it occassionally.

nine_k
3 replies
12h27m

It only works when first you accumulate some resources (knowledge, money, wisdom, strength, whatever) which you can then spend on others.

Just staying poor and spending your whole days on searching for food (or a drink, or a dose) does not provide one with many opportunities to do interesting things with their life.

Giving is what makes a life great. But you have to have something to give first.

actionfromafar
2 replies
5h37m

True.

I think it can also mean that you are free to do things which are not possible if you chain your actions to the goal of financial success.

ponector
0 replies
4h21m

But if you are poor and live in poverty - there is almost nothing you can do, only to struggle to get by another day.

nine_k
0 replies
3h37m

Yes, not necessarily a financial success. Success or resource of any kind, taken widely. Prince Gautama did not share his inherited riches, instead he shared the information about the path to enlightenment. William Shakespeare was apparently tight with money, what he shared was his mastery of English language. Etc.

deadghost
3 replies
16h45m

I've currently reading Warren Buffett's biography, The Snowball by Alice Shroeder and "Sandy" Gottesman frequently appears. When I saw 2, I thought that sounds awfully like someone I read about in Buffett's Graham group. After 3, it was definitely someone in the Graham group I've read about.

The Graham gatherings that included Buffett and Gottesman had fine gentlemen, at least one of which has championed a similar cause in the past, whether that was Gottesman or another one of his peers, my memory fails me. While it's sad to see someone I am still reading about pass away, it's heartening to know that he ended on a high note and that he continues to leave a positive impact from beyond the grave.

boppo1
1 replies
13h48m

As someone who studied/follows finance, but doesn't work in it, BH is about as 'The Good Guys' as it gets in the investing business. Pick stuff that matters & works, fund it, don't sell it.

Nullabillity
0 replies
10h13m

BH is perfectly happy to run predatory loan businesses. It's also worth remembering Munger's nightmarish forays into architecture.

chenxi9649
0 replies
16h25m

Oh that's super cool to know!

rldjbpin
0 replies
9h24m

My university has a few B's in endowment

weird flex but ok

VincentEvans
52 replies
19h38m

- 1B in donations at 5% APR conservatively invested will yield 50M every year.

- At yearly tuition rate of 59K the earned interest is enough to pay for 850 students without drawing down the invested principal.

- Albert Einstein college of medicine admits about 150 freshmen every year and medical school is 4 years long. So at any given time there are 600 students studying medicine at this school.

It seems to me that simply earned interest on this donation should be enough to allow students to attend this school free of tuition indefinitely.

anonym29
25 replies
19h35m

It's enough not only for that, but to gradually expand the number of students they can afford to admit tuition-free into the future (strictly on interest), as well, should the desire to do so ever arise.

delfinom
24 replies
19h4m

Given that the AMA cartel sets artificial quotas on med school admissions per school, it's not that simple lol

verteu
23 replies
18h3m

I don't think that's accurate. From my research, the bottleneck is residencies, whose funding is determined by Congress [1]. The AMA has supported laws to increase residencies, such as "H.R. 2389/S. 1302, the Resident Physician Shortage Reduction Act" [2].

The paper "Physician workforce in the United States of America: forecasting nationwide shortages" [3] mainly blames an aging population and too-slow growth in the number of "residents and fellows".

edit: Found a dissenting view here [4], its main reference seems to be [5].

[1] https://www.washingtonian.com/2020/04/13/were-short-on-healt... [2] https://www.ama-assn.org/system/files/2024-nac-action-kit-gm... [3] https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7006215/ [4] https://www.motherjones.com/kevin-drum/2013/11/its-doctors-w... [5] https://washingtonmonthly.com/2013/06/19/first-teach-no-harm...

bradleyjg
22 replies
17h19m

whose funding is determined by Congress

There’s no law forbidding you, a state government, a local government, an insurance company, the AARP, or anyone else from funding a residency.

verteu
21 replies
16h11m

Good point - I don't see why they're subsidized by the federal gvt at all, rather than the resident, the hospital, the AMA, etc.

whatshisface
20 replies
15h48m

Med students don't have a lot of money, and hospitals are actually there (from their perspective, at least) to make money. The AMA doesn't have a lot of extra money either.

bradleyjg
17 replies
15h46m

They don’t have a lot of money yet. They have a very high amount of lifetime earning potential compared to their peers in other countries (yes, even after debt service and malpractice insurance.)

esoleyman
16 replies
14h32m

Are you seriously asking residents to subsidize their own training working 60-80 hours a week [1] and being paid maybe $20-25/hr for 3-7 years while the hospitals make money from their services?

If that were the case, then the only ones who would put up with such a system would be those who have rich families to back them up.

I came from a blue collar background and my family could not help subsidize my training and I could not afford to live, make rent, or afford food if I had to pay for my training as well.

There are so many other things that you are completely glossing over including annual income between generalists vs specialists, pediatricians vs non-pediatricians, reimbursement inequality from Medicare (has not kept up with inflation and is ~40% below inflation), Medicaid pays at best 10-15% on the dollar, and so on.

American physicians also work almost teice as many hours as their European counterparts which would increase their incomes.

[1] it’s considerably more because if you report it then the program can be in danger and lose its credentialing

ElFitz
7 replies
12h34m
bradleyjg
5 replies
5h39m

US doctors are among the richest people in the entire world, have an involuntary unemployment rate that rounds to zero, can live wherever they like without serious impact on pay and yet somehow are also the most oppressed and put upon if you ask them. Go figure it out.

esoleyman
4 replies
5h25m

It’s inappropriate to link once dissatisfaction with one’s income.

There are multiple reasons why US doctors are unhappy about their profession. I’m not sure where you get being oppressed as being the titular complaint.

I was an engineer before going to medical school and have an outside perspective as well.

I have complaints with medicine as to how it has changed over the last 10 years and not for the best. I have the right to complain to make things better for my patients and my work-life balance. That doesn’t mean that I am oppressed.

bradleyjg
3 replies
5h20m

You have the right to complain and I have the right to point out that your industry, along with the housing and education industries, has stolen the entire productivity gains of a generation of Americans. I’m not concerned with your work life balance.

esoleyman
1 replies
3h1m

Your complaint should be directed towards the hospitals, for-profit insurance companies, and others who profit massively on the backs of patients.

My "industry" is only myself as I am beholden to my patients. I work and am paid by each patient who I treat and receive reimbursement by 50% of them at best.

If you don’t care about my work-life balance and lump me in with the rest of the healthcare system, then there’s nothing much to discuss.

HDThoreaun
0 replies
2h23m

Doctors also massively profit off the back of patients. They make far more and live a far more lavish lifestyle than doctors in other countries. I have multiple doctors in my family, they all work less than 30 hours a week and make more than 300k. And theyre not even in the lucrative specialties. Most are family physicians which Im sure you know is the worst paid doctor.

Amezarak
0 replies
3h12m

Health care cost disease in the US has little to do with doctor salaries or demand for doctors. Unfortunately, as that would be a relatively easy problem to solve. The data I've seen indicates physician salaries adjusted for inflation are relatively flat or have even declined since the 1970s.

esoleyman
0 replies
5h24m

You may be right about the work hours. I possibly mis-remembered an article from several years ago when they compared income and work hours.

tastyfreeze
4 replies
13h58m

subsidize their own training working 60-80 hours a week [1] and being paid maybe $20-25/hr for 3-7 years while the hospitals make money from their services

That sounds like an apprenticeship. Many other industries do exactly that. Why should doctors be different?

LunaSea
3 replies
11h30m

Because you don't work 60 to 80 hours a week during an apprenticeship.

verteu
2 replies
5h21m

But why must medical residency require 60 to 80 hours per week of work? AFAICT, it's because residencies are competitive, because there aren't enough of them, because nobody wants to pay for them. (But you can't make them unpaid, because, by circular logic, they require 60 to 80 hours per week.)

As an outsider, the whole system seems completely bizarre to me.

[AMA president] Dr. Richard Corlin has called for re-evaluation of the training process, declaring "We need to take a look again at the issue of why the resident is there."
bradleyjg
0 replies
5h6m

It’s at the intersection of the medical cartel and the credential cartel. A giant pile of suck.

LunaSea
0 replies
5h19m

They don't but it's the current situation nonetheless because medical students are at the mercy of their resident doctors.

If you don't do it, they will sack you, fail you or you won't find a job there.

Emma_Goldman
2 replies
10h29m

I agree you should be paid properly. But I don't understand why, if the US has a privatised healthcare system, hospitals are not paying to train their own labour?

esoleyman
0 replies
5h32m

They do to a degree but most of the money comes from the government to subsidize costs. I’m not privy to the amount or percentage but they do cry about it when the residency union (CIR) asks for inflation adjusted salary increases.

bradleyjg
0 replies
5h28m

US hospitals are almost all nominally non-profit. In practice, they are partnerships run for the economic benefit of controlling employees but the scam the tax code by pretending otherwise.

verteu
1 replies
5h10m

So hospitals won't pay to train their workforce because... they can save money by forcing Congress pay for it?

hospitals are actually there (from their perspective, at least) to make money

Aren't most hospitals non-profit?

(Disclaimer: These are genuine questions; I have very little knowledge of the medical system.)

HDThoreaun
0 replies
2h26m

So hospitals won't pay to train their workforce because... they can save money by forcing Congress pay for it?

They wont train their workforce because they would lose money doing it and can always hire people already trained. It's a tragedy of the commons which is why congress had to step in to subsidize.

Aren't most hospitals non-profit?

Technically yes, but most are part of massive systems that are run by MBAs like traditional corporations.

farseer
7 replies
14h37m

There is no risk free 5% yearly return. The current interest rates may be temporary and there is inflation that erodes the 50M and the Principal amount.

mgiampapa
6 replies
14h26m

On a large scale a 5% average return is very conservative. No interest rates won't stay where they are, but no one would invest an endowment just by putting it a HYSA.

JumpCrisscross
5 replies
11h35m

On a large scale a 5% average return is very conservative

Any return above GDP growth is not conservative. On average, real world GDP has grown at 3 to 5% per year since 1964 [1]. (We use real GDP because university costs will increase with inflation.)

600 students would have paid $35.4mm in tuition a year at $59,000 per year. That's a 3.54% drawdown per annum, right in line with real GDP growth. A 4 to 5% real return target is doable, but not conservative and certainly not a figure with a lot of margin for error.

[1] https://www.macrotrends.net/countries/WLD/world/gdp-growth-r...

Emma_Goldman
3 replies
10h40m

Growth is a useless indicator. The whole point of Piketty's argument is that the return on capital tendentially outstrips the rate of growth, and that large investors have access to especially high return assets. The OP is right that a 5% average annual return is conservative.

JumpCrisscross
2 replies
10h14m

Growth is a useless indicator. The whole point of Piketty's argument is that the return on capital tendentially outstrips the rate of growth

I'll sidestep that Piketty measures wealth and calls it capital. Because that observation says nothing about how risk is distributed across those returns.

large investors have access to especially high return assets

$1bn doesn't make for a "large investor" in institutional terms.

OP is right that a 5% average annual return is conservative

No, they are not.

There are objective measures for this. I've worked closely with endowments the world over. A manager pitching a 5% target return on a fund with a 3.5% annual drawdown as conservative would be fired. A banker pitching the same would be subject to professional sanctions.

Emma_Goldman
1 replies
10h4m

Cute

Sorry, this is childish and you don't substantively respond to the core point. I am not going to waste my time.

JumpCrisscross
0 replies
9h54m

Fair enough. Edited.

you don't substantively respond to the core point

Yes, I do. Even if capital returns well in excess of growth on average, that doesn't change that the returns on assets in that excess regime are riskier than those below it. (This actually being formally provable by way of seniority.) Excess returns are never achived conservatively, let alone very conservatively.

Piketty's work has been seriously challenged. It makes good points. But it also contains bad ones, including a couple really sloppy and unsubstantiated assertions. His conflation of wealth and capital being germane to your argument.

scotty79
0 replies
5h42m

Any return above GDP growth is not conservative.

That would be true if additional GDP was distributed equally. But the rich capture majority of it in their investment vessels. So for a person with capital I think double of GDP is still conservative as long as inequality grows.

laweijfmvo
6 replies
19h13m

Let's hope the tuition (and all other costs at the university) don't magically start going up now that they have all that money flowing around...

et-al
1 replies
19h1m

Cynically, I'm concerned administrative bloat will catch up in 5-10 years and they'll have no choice but to charge students again.

hx8
0 replies
15h37m

I give it closer to 20 years, but I agree.

thret
0 replies
11h57m

Hopefully the donation was made with sufficient fine print to avoid this eventuality.

mixdup
0 replies
15h59m

Well, given the numbers in the parent comment they should have a surplus of $14.7 million yearly, so they could just let the surplus go back into the endowment and that would help keep up with inflation

gonzo41
0 replies
18h30m

This will happen. Count on it.

earthwalker99
0 replies
18h59m

Don't worry about that! It turns out capitalists are wonderful people so they deserve it!

bombcar
2 replies
19h29m

Or another way to look at it, you only need $50m a year to be the "equivalent" of a billion dollar endowment, and $50m a year is the budget of a smallish county.

ksherlock
1 replies
14h41m

There would seem to be about 10 countries with a budget of $50 million or less and most of those are islands you've never heard of with a population under 2,000.

https://en.wikipedia.org/wiki/List_of_countries_by_governmen...

In the US, $50 million would be closer to the budget of a small city (~50,000 people.)

bombcar
0 replies
14h37m

Which is why I said “small county”. A county in the US is a division made up of the land around some cities.

amirhirsch
2 replies
13h42m

Michael Saylor can sell enough Bitcoin to make MIT tuition-free. We should pressure him.

stephen_g
0 replies
12h19m

Sure, but surely you'd have to dispose that much bitcoin over a really, really long time to not seriously move the price down... People might be disappointed at the amount of real money actually flowing around the cryptocurrency markets...

lowkey
0 replies
13h16m

MIT's existing endowment is nearly $30 Billion.

Why single out a particular private individual or his publicly traded company when you could simply pressure the institution itself to make tuition free?

sergiotapia
0 replies
15h20m

Beautiful, I hope admin bloat doesn't eat the whole enchilada.

nshelly
0 replies
15h26m

Yes, great win all round, and also can help save on administrative costs. Poetically it was Einstein who said:

Compound interest is the eighth wonder of the world. He who understands it, earns it … he who doesn't … pays it.

happytiger
0 replies
17h20m

As long as they can reinvest the extra to keep up with inflation.

It’s a reminder of what can be done when billionaires give back and pass it through to society instead of passing it along to their heirs.

This kindness is going to change the world and provide doctors that will treat and help hundreds of thousands.

fisherjeff
0 replies
19h1m

Well they won’t touch the principal so long as tuition inflation stays below about 1.5%

IG_Semmelweiss
0 replies
13h38m

opportunity missed.

She should have made the gift contingent on keeping tuition costs indexed at 2023 level plus a tiny fraction of inflation say 0.5%

Then the real challenge would be very interesting - what they could cut every year to keep the program going.

aantix
42 replies
20h23m

If we were to get to a single-payer healthcare system, it seems like we would have to tackle the issue of medical school debt.

$360K of debt would be a massive burden if the system had fixed costs.

echelon
19 replies
19h58m

It's not just tuition. There are so many issues with the workforce and their education:

- We cap the number of residency students per year, creating an artificial limited supply.

- We don't allow immigrant doctors to transfer their credentials, creating an artificial limited supply.

- Med school is expensive, limiting the pool of applicants.

- Nurses and nurse practitioners are extremely close to the action on a daily basis. There should be a path for them to graduate into doctors, perhaps by attending night school and then some form of on-the-job residency.

ejb999
10 replies
19h45m

I for one am glad we don't just let foreign doctors transfer their credentials - the education and standards are not always the same, and not really sure I want to go see a doctor that moved here after taking a accelerated/minimal set of courses at whatever country happens to have the easiest/cheapest graduation requirements. Certainly there are some countries that probably have similar course of study and requirements as the USA, but I think you would need to approve transfer's very carefully after serious review of the sending countries education and training requirements.

NP vs MD education is not even close to being similar - that is why their is no easy path from one to the other - a typical NP will graduate having done ~600 to 700 hours of patient care hours. A typical MD will have had 12,000 to 16,000 hours of patient care experience before they start practicing - there are plenty of things were seeing an NP is more than enough - but you can't just give a few months of extra training to bump an NP to an MD - their education and knowledge is not even close to comparable.

There is a place for both in our health care system - but they are not the same job.

ilc
8 replies
19h14m

Personally, I'll take the 60 year old NP over the 30 year old doctor 95%+ of the time.

The NP has seen more and been around the block. The doctor still is a baby in medicine.

devilbunny
5 replies
15h28m

Do what you like, it's your life, but as a physician I've been stunned on occasion by some of the misunderstandings of very experienced nurses.

They don't have a medical education. They have a nursing education. They are different things. A good doctor relies on experienced nurses for what they are good at - which is recognizing someone who's in trouble, because they have spent a lot more hours at the bedside than we have and have superb spidey senses. If a nurse asks me to look at a patient, I will. If it's an experienced nurse, I'll come running.

ilc
3 replies
15h16m

A good doctor. That is a huge proviso alas. I wish it wasn't.

devilbunny
2 replies
13h51m

"Good" from our perspective is not always the same as "good" from a patient perspective. Some of the best doctors I know have the bedside manner of a chunk of midsummer roadkill. And some of the worst could charm anyone.

IG_Semmelweiss
1 replies
13h9m

and nurses could tell you exactly who's who.

The best friend to have is an OR nurse. She knows which doctor is on cocaine, who cannot stop shaking when handling the scalpel, who cannot bother with a prep checklist before a surgery.

If you are doing surgery for a loved one, consult an OR nurse. They will tell you what's up.

Best of all, nurses all talk to each other, so chances are someone in their group will know that Dr. Charming over at hospital X is nicknamed The Undertaker by in-the-know staff...

devilbunny
0 replies
13h1m

Definitely true.

classichasclass
0 replies
15h9m

(also an MD) I've always conceived of it as a good NP will have been around long enough to know you usually do X when Y, but they don't know the reasoning for X or the pathophysiology underlying Y, and they don't always know when you shouldn't do X.

That said, especially in primary care, give me an NP over a PA anytime. Primary care is a numbers game and NPs roll the dice better. Specialty PAs are great; I learned some of my best ortho from ortho PAs. But generalist PAs scare me and have been the source of some horrific consults in the past.

FireBeyond
1 replies
18h13m

The problem is the Zero-to-NP programs that have an "Accelerated RN" component.

One (not all) aspects of the NP program was similar to your comment, building off career and professional experience, and using that as one basis for knowledge.

These programs are not even giving you the RN -student- nursing experience (let alone post graduation), they're skipping that entirely.

Looking online:

"Become an NP in 20 months". "NP in 27 months".

From HIGH SCHOOL.

In EMS, there is a push to make paramedicine at least an associates, if not a bachelors degree (there are programs with all three, certificate, associate, bachelors).

Paramedics are the advanced version of when you call 911. The invasive side (versus EMT which is - largely - non-invasive). Cardiac arrest and dysrhythmia management (ECG interpretation, manual defib and pacing, approximately a dozen cardiac drugs), airway management and intubation (including sedatives, paralytics and analgesia), childbirth, trauma, burns. In my area we can give approximately 60 different meds IM, IV, IN, IO from fairly benign to quite acute (adenosine, atropine, etomidate, rocuronium, etc.)

The push for this is for at least two years of school, if not four.

But yet you have schools pumping out NPs in as little as a year and eight months? With zero field supervision (for better or worse, and with varying degrees of intensity, PAs ostensibly operate under physician supervision/direction).

This is going to cause a huge problem, I expect. Not the concept as a whole, but our YOLO attitude to these things, and schools seeing dollar signs.

ilc
0 replies
15h27m

You will get no disagreement here.

I specifically pointed at older NPs for a reason.

Heck even old RNs will know what they are doing.

For us programmers it is a bit like why you don't let the new kid push straight to prod. But an older engineer may have a key to do it. ;) There is some wisdom that comes with the grey hair.

IG_Semmelweiss
0 replies
13h13m

I don't disagree, but its a good thing that we can buy Ferraris and Kias and let everyone decide what's best for them.

I think foreign doctors could fill a niche there too. I don't know why we have people going bankrupt due to medical bills when we have foreign doctors that could drive prices down significantly so that the poorest or underinsured could benefit.

HEmanZ
5 replies
19h47m

Yes, it is similar skill and effort for an np who got a one year online degree that took 15th/wk of studying and a doctor who spent 80hrs per week of studying for 4 years to complete med school, then did 4-7 years of 80-100hrs per week of intense residency.

Do you really believe this when a loved one’s life is on the line?

echelon
4 replies
19h26m

There's no path they could take to become a doctor? Even if they spend a decade in the field, fully hands on?

HEmanZ
2 replies
19h13m

I actually do like the idea there should be more ladder and less silo. Im not sure how it could be implemented tho. I’m just reacting to the idea that mid levels are anywhere near as skilled (meaning training) as most physicians.

The hurdles I see are: There’s a reason doctors have really intense study time before residency, and you’d have to replicate that. There’s also a reason residency is so intense, you’re not going to get anything like resident experience doing ordinary mid level work.

You’d need to hybrid model, but who is going to agree to something like: instead of working as a nurse 40 hours per week, you’re going to work 40hrs/wk and study 40hrs/wk, for 8 years, and if you pass the tests you’ll move on to the next level. This could work but basically sounds like part-time med school.

Part time residency would be even less appealing, it would take you like 10+ years to get the amount of cases a resident has if you were only doing it part time

echelon
1 replies
18h29m

These are fair points. It does sound like a difficult bridge to build. I don't think it would be impossible, but there's clearly a big gap.

devilbunny
0 replies
15h22m

The bridge is "apply to, be accepted at, and graduate from medical school". Offhand, I personally know at least four physicians who were nurses first, and they certainly worked occasional shifts as nurses during med school for extra money, but it's hard to describe just how big of a torrent of information medical students are expected to absorb. There's very little overlap in the education, although former nurses usually have better simple-procedure skills (IV's, catheters, etc.) and superior skills at dealing with difficult patients early on in clinical education.

ejb999
0 replies
6h35m

The problem I see with that is, a typical medical student is going to have to do study and clinical rotations across all disciplines - even ones they don't end up practicing - i.e. pysch, derm, emergency medicine, surgery, ortho etc - i.e., they will get training in all those areas.

Compare that to an NP that went from their 18 month NP class, to work in primary medicine/family practice office - and lets say they work there for 10 years, so great, now they are an experienced NP in family medicine (and someone I for one would be perfectly happy to see as a patient for most routine things) - but what they don't have is the experience in all those other areas that matter - even if they are not practicing it.

There is just no shortcut without putting in the time - thousands and thousands of hours of study and patient facing experience under the supervision of an experienced MD.

There is nothing wrong with being an experienced NP seeing patients (and that is mostly who I end up seeing) - but there is simply no reason to somehow 'promote' those people to doctors - they don't have the same skills or the same experience, and doing so doesn't solve any problem.

fasthands9
0 replies
18h54m

I agree. The donation is a pretty great thing - but without increasing the number of residency slots per year it seems like it may just shift people that would go to another school to go to this one.

dmoy
0 replies
19h53m

plus the other 85% of medical expenses (since what only 15% is doctor & nurse & tech pay?)

Even if doctors and nurses worked for $0, we'd still have the most expensive healthcare system due to admin, drug, etc costs.

HEmanZ
18 replies
19h55m

Medical school debt and physician insurance. Some specialties have just wildly high insurance.

My wife is an OB and has to pay $140,000/yr per year for tail insurance in my state. So she literally needs to make, after all other costs of the practice, $140k just to break an even $0/yr.

And people wonder why it costs so much to have a baby.

MisterBastahrd
4 replies
18h7m

It's also why OBGYNs are fleeing red states and some labor and delivery departments at hospitals (see Bonner General Health in Idaho) are shutting down. Not only is it insanely expensive from an insurance stance to begin with, but when you add the possible malpractice lawsuits from doctors being unsure what their legal standing is on a potentially life threatening issue, many would rather just move to a place where that isn't an overriding concern.

hn_throwaway_99
2 replies
16h35m

It's also why OBGYNs are fleeing red states and some labor and delivery departments at hospitals

I feel like you're conflating 2 separate issues:

1. You are correct, one of the biggest concerns for physicians is malpractice risk, and thus a big draw for physicians (especially in high risk specialties) is states that have low caps on max malpractice damage awards. I'd say there is a tendency of red states to have lower caps, but it's really a mix. E.g. Texas has some of the lowest malpractice caps, while Wyoming has a constitutional provision prohibiting caps.

2. When it comes to the risk of obgyns, the main fear is not really the cost of malpractice, but it's simply that extremely restrictive abortion laws make it impossible to give proper care. Lots of people, and politicians especially, like to see the world in absolute black and white, but obgyns know more than anyone else that there are a whole host of issues that can cause a fetus to be nonviable, or dangerous to the mother, and laws that protect the fetus above all else are not rationale. Obgyns can fall anywhere on the political spectrum just like the populace at large, and there are plenty of conservative obgyns who are against abortion for moral or religious reasons, but they also know the realities of pregnancy and that many of these laws are simply unworkable.

MisterBastahrd
1 replies
14h57m

You're missing the forest for the trees.

It doesn't matter that some states have caps on malpractice payouts. That's only half the matter. It's the number of times that a doctor has to be sued FOR malpractice, because a lot of those costs are going to be attorney fees. If I were a lawyer in Texas, I'd be posting billboards about specializing in suing doctors for not providing care. When women realize they can win a windfall in court for being denied care with life threatening conditions, they're going to start suing. And winning. Juries love giving away insurance company money.

More suits, higher premiums. Since that risk is spread across the state, so is the insurance rate. Most conservative OBs still understand, know, and respect the science. If Texas or Idaho or Alabama gets too expensive, especially given how absolutely garbage the standard of living is in those states, they're gonna haul ass political affiliation be damned.

hn_throwaway_99
0 replies
14h43m

If I were a lawyer in Texas, I'd be posting billboards about specializing in suing doctors for not providing care.

This is a fantasy, it has never happened, and it's fundamentally not how the law works. Show a single instance where a doctor has been sued for refusing to give care due to risk of running afoul of restrictive abortion laws.

IG_Semmelweiss
0 replies
13h17m

big claims require big evidence.

Where's all this noise about a regulatory stance causing malpractice lawsuits to skyrocket ?

testfoobar
3 replies
15h12m

The cost of insurance is outrageous because settlements in medical malpractice lawsuits are outrageous. Tort reform is necessary to control medical costs - it is opposed by Democrats in the US. Trial lawyers are an important and generous lobby.

IG_Semmelweiss
1 replies
13h21m

Paretto rears its ugly head as well. 20% of the bad actors are 80% of the lawsuits.

There are patients that make a living going around doctor offices and suing them. I know 1 patient in particular that went around suing doctor offices because they would not cater to his blindness. He would threaten a lawsuit without setting a foot in the doctor's office.

He would browse the doctor's website and complain it was not blind-compliant. And start from there.

erik_seaberg
0 replies
12h47m

I once worked on a legal case management database. One of the clients was getting sued over breast implants, and they used the database to catch scammers who sued fifty times (once in each state) over implants they never actually had.

wolverine876
0 replies
10h43m

The cost of insurance is outrageous because settlements in medical malpractice lawsuits are outrageous. Tort reform is necessary to control medical costs - it is opposed by Democrats in the US. Trial lawyers are an important and generous lobby.

Why assume the problem is the legal system and not the doctors? Maybe their performance is the problem.

For example, last I saw, hospital error was a leading cause of death in the US. Until recently it was hard to get doctors to wash their hands between patients, or follow checklists to ensure quality. There are stories of an omerta-like rule of silence about surgical errors.

Scoundreller
2 replies
19h51m

Why is insurance just a flat rate? Shouldn’t it be per procedure or something else better correlated to risk?

(Sure, charging precisely for risk would just result in some patients/scenarios being avoided, but per case or a percentage of billing would make much more sense).

devilbunny
0 replies
15h38m

Doing more procedures exposes a physician to more risk, but those who do a lot of procedures generally are better at them. I'm an anesthesiologist, but I don't do infants or cardiac cases, and I haven't done them in long enough that I wouldn't want to do them without someone around to get me back in the groove.

Someone who does one vaginal delivery a month is not going to be as good at doing them as someone who does two or three a day. And they certainly won't be as good at cesarean sections. Delivering just one baby costs a hell of a lot of money in insurance, which is a major part of why family doctors in rural areas don't do that anymore.

By contrast, people who drive more miles - even if they are excellent drivers - are at higher risk of being in a collision because they have to deal with other people on the road, who may be terrible drivers.

HEmanZ
0 replies
19h45m

It isn’t flat, that’s the average of the last two years. It does adjust for a lot of things, like any insurance. It is higher than avg in the state for my wife right now because she is only a few years out of residency.

Mid career, she should only expect to pay about $120k/yr…

_fizz_buzz_
1 replies
11h30m

But how much does she make? 140k per year if you make 150k is of course not a lot but if she makes 900k or something like that. It's worthwhile. Although I do agree that sounds awfully much for just insurance.

HEmanZ
0 replies
4h33m

About $270k last year. So literally just over half her income.

IG_Semmelweiss
1 replies
13h28m

that seems unusually high. I've seen 20+ quotes for doctors in very litigious states, and its not even 1/2 of that cost. Full time doctors.

Try shopping around insurance or go with a mutual, or perhaps go with a IPA ?

NOTE: This rate is CERTAINLY valid if the OB has a long track record of attracting litigation. All insurers will ask for your "run rate" of claims. So, you can't escape a bad record. If you have a history, insurers will charge accordingly. You can't escape a poor record.

HEmanZ
0 replies
4h9m

Were the quotes from dermatologists, radiologists, and psychiatrists? Or from gen-surge and OB? What state?

This is OB in the state of Illinois, it’s roughly the same cost ans all of the other OBs we’ve talked to here. She doesn’t have a litigation history at all yet.

FireBeyond
1 replies
18h34m

If she is still working as an OB, what would be the difference in premium to renew her claims-made policy with prior acts coverage?

I can't imagine (but do not know) that it is more efficient to pay claims-made AND tail, versus claims-made with prior acts (unless of course your employer is paying the claims-made).

For those not in the medical field, tail or ERP (extended reporting period) coverage is liability coverage for when the original policy has ended - i.e. you were insured for 2024, but in 2025 a malpractice suit comes to you for an incident in 2024. In the auto/general world, this is fairly well accommodated, but in the medical liability world, insurers say it is because of the preponderance of claims that may arrive significantly later than coverage.

However, many insurers absolutely ream providers on it. Tail insurance is typically double the actual claim premium, i.e. insurers are saying that your insurance premium is only covering 1/3 of the claims they expect to pay on your behalf. I ... have doubts ... on that number. And I also suspect that there is a bell curve happening where certainly, complex malpractice claims may take time to be built out and filed, and that may extend beyond coverage, but then at a certain point, you can relatively confidently assume that the incoming claims are asymptotically approaching zero.

Additionally, I cannot exactly remember if malpractice insurers are required to abide by MLR - profit restrictions - like the 80/20 rule, but in your wife's case, the insurers as a whole (claims-made and tail) are implying that they expect to pay out $168,000 a year for her liability.

IG_Semmelweiss
0 replies
13h20m

her run rate could certainly be 168k .

abeppu
1 replies
19h55m

Is it necessarily the case that median physician pay must go down for a single-payer system? I would hope that we could have savings if the total payments to actual care providers was similar, but billing, and insurance parts of the system were dropped out of the picture.

Scoundreller
0 replies
19h8m

The numbers I can quickly Google for US are ~15-30% spent on administration, not that those zero out under single-payer.

It's not just the physician/surgeon aspect of US healthcare that's expensive, it's all of it.

I'm on the Canadian side, and drugs have never been single-payer outside of a hospital, but that leg of the system is still much cheaper (on average) in Canada.

Scoundreller
0 replies
19h55m

Canada has managed to undertrain its own people domestically for med school for a while with many going to the US/caribbean/europe for training at full rates.

We’ve had to change our terminology from “international medical graduates” to “foreign medical graduates” because a lot of those trying to get foreign credentials recognized are locals.

Probably a tough slog upon return to pay back the debts but net-positive in the long-run (unless interest rates go up, uh oh).

jameskraus
25 replies
20h27m

Wow, the Albert Einstein College of Medicine is about to immediately be the most competitive medical school in the US. I wonder how this will affect the number of doctors graduating from the school and how many will go on to practice in NYC / the Bronx.

gnicholas
17 replies
20h18m

When UC Irvine launched its law school, they made tuition free for the first graduating class (and perhaps gave discounts to the next couple years — I can't remember). They are now ranked #35 in the USNWR, which is pretty good for a school that's about a dozen years old.

My guess is that having free tuition for all students forever will have a much bigger impact. I believe Princeton's policy school is similarly endowed, [1] and it's basically the top choice for anyone getting an MPP. Of course, it also has the prestige of Princeton associated with it; I could imagine some student choosing Harvard over this school, which doesn't currently have the same name recognition/prestige. But surely that will grow as a result of this announcement!

1: https://spia.princeton.edu/blogs/we-fully-fund-all-students-...

wrs
13 replies
20h17m

Irvine did that as an enticement to attract students for the first years, because the school couldn’t be accredited until the first class graduated. So the folks who enrolled for the first three years were taking a risk.

gnicholas
12 replies
20h0m

True, though with the faculty they lined up (including Dean Erwin Chemerinsky), there wasn't much risk of it not being accredited.

bombcar
10 replies
19h26m

A degree from an unaccredited college/university is not as worthless as you might think; in fact, if the education is at least middling, it can be quite a steal.

Hard to find them, however, that aren't just scams.

gnicholas
9 replies
19h17m

In CA, you don't even need to attend an accredited law school to become a lawyer! There are some additional hoops you have to jump through, but at the end you can take the bar just like anyone else. However, if you wish to ever practice outside of CA, there is zero reciprocity (except DC) so you are treated as if you never went to law school.

yumraj
1 replies
18h29m

So you’re saying that Mike would have been just fine had Suits been based in CA?

gnicholas
0 replies
17h8m

He definitely would have had a path to apprentice, pass the bar, and then practice law. Lying about being an HLS grad would have presented some challenges for his character-and-fitness assessment by the bar, if he had tried to go that route first.

gnicholas
0 replies
17h0m

Sure, but studying under a lawyer or judge would look very different from law school. I have wondered if a prestigious lawyer would ever open up a few slots of paid apprenticeships, a la Thiel Fellowships. I don't know what the rules are regarding paying apprentices, but anything beats $60k/year in loans! If you can get some bright students who want to learn, they could probably work 10 hr/wk in the first year, 20 hrs/wk in the second year, and 30 hrs/wk in the last two years, while being more than prepared for the bar exam (especially since it has been 2x made easier in recent years).

throwup238
1 replies
15h0m

To be clear, very few people become licensed lawyers in CA taking this path. The vast majority can't pass the Bar and the state often goes years without a single person passing via the apprenticeship track.

gnicholas
0 replies
14h3m

Oh sure, I was referring primarily to people who attend non-accredited law schools. There are several law schools that are not ABA-accredited but that are CA-accredited. There are a few more that are not accredited by either. The apprenticeship track is probably less popular than either of these routes, although recently it's been made famous by Kim Kardashian.

memco
1 replies
14h4m

Some states do have a way to become barred without starting from zero if you are barred in CA. For example in WA you still have to take a test, but it isn't a full three-day bar exam.

gnicholas
0 replies
13h54m

Oh cool — do you know where to find info on which states offer this?

bombcar
0 replies
19h11m

And WI lets you practice law with only a degree (diploma privilege) so I think (somehow) there must be a way to go to school in WI and be a lawyer in WI and CA .... ;)

https://en.wikipedia.org/wiki/Diploma_privilege

wrs
0 replies
1h29m

Yes, it ended up being a pretty good deal for the first students! They recruited some great people from all over (including a couple of my friends, which explains my unlikely knowledge of any of this…).

acchow
1 replies
19h54m

A new medical school in coastal California was bound to attract talent, in staff and students.

gnicholas
0 replies
19h45m

There are plenty of lower-ranked schools in CA, including several unaccredited ones. UC Irvine SoL leapfrogged all of them, partly because UC tuition is lower than privates. But being located in SoCal isn't a guaranteed of top talent — just ask University of San Diego SoL (#78) or Southwestern SoL (#141).

pyuser583
0 replies
12h44m

It’s common for new colleges to offer free tuition.

In order to be accredited, you need to show you can produce a decent class of students. But how do you get the students if you’re not accredited?

Free tuition.

The accreditation can be retroactive, so they might be getting an accredited degree for free.

I don’t know if this was the case at UC Irvine Law School.

hhs
5 replies
20h0m

If interested, another medical school in NY that offers free tuition is NYU. They write, "1st medical school to offer Full-Tuition Scholarships for all students" [0].

[0]: https://med.nyu.edu/education/md-degree/md-admissions

gnicholas
1 replies
19h35m

Interesting! Does anyone know how this affected their application numbers, selectivity, or ranking?

We award Full-Tuition Scholarships to all current students and future matriculated students, regardless of merit or financial need, that cover the majority of the cost of attendance, provided each student maintains satisfactory academic progress in accordance with NYU Grossman School of Medicine’s Satisfactory Academic Progress Policy

I wonder what it means to cover a "majority" of the cost of attendance. Does this mean they cover tuition, but living expenses (which are not trivial in NYC, but which are less than tuition) are not covered? Or are they just referring to their own fees?

lamroger
0 replies
15h31m

To add on, it was a huge consideration for the applicants that I know of

jameskraus
0 replies
16h51m

Wow, had no idea. Thanks for sharing!

scotty79
0 replies
5h29m

Nobody likes leaving money on the table so they will start charging additional fees. Not tuition but some other things, obligatory insurance, mandatory auxilary premium fee, whatever, anything that plausibly falls outside of donation agteement.

I just hope they have enough decency to delay it till the donor dies so she doesn't have to witness it.

WalterBright
22 replies
16h45m

This is a great and generous initiative. But there is a potential downside. People, being human, tend to not value what they get for free.

Just some examples I see:

1. people don't turn off the lights when they leave a hotel room. I ask why, they say "who cares".

2. people abuse rental cars, because "it's just a rental".

3. students abuse free textbooks.

4. heck, the whole free public school system.

5. nobody values a "participation" award.

And so it goes. Students should have some sweat equity in their education.

paulcole
10 replies
16h35m

Students should have some sweat equity in their education.

I don’t think you mean “sweat” here.

Because they do have sweat equity in their education. They have years of hard work behind them and ahead of them.

If they fail out of this school they can reapply and pay $300k at another school.

WalterBright
9 replies
16h28m

The freshman classes could be swamped by people who aren't serious about getting a med degree. And why should they be serious? It doesn't cost them anything. Heck, they could have a good time for a semester and never attend class. Caltech was a pretty fun place to be.

If people are halfway through, a motivating thing to keep them going is the money they've already invested in it.

I bet you'll see a significantly higher dropout rate with free tuition. Like we see in public high school.

selimthegrim
2 replies
15h53m

Do you think a tuition free Caltech would have been a bad idea?

WalterBright
1 replies
10h6m

Yes. I worked a side job to pay my way. You bet I wanted to get the value out of what I was working and paying for.

Another effect we see these days is the government education loans encourage people to sign up for expensive and useless degrees, and then they are apparently shocked that they have to pay back those loans. Hence the push for loan "forgiveness".

Without these loans, I bet there would be far less demand for these degrees with no market value.

selimthegrim
0 replies
6h47m

You think Caltech would get worse students if it didn’t charge tuition? I assure you it’s well out of side job territory now.

paulcole
2 replies
16h21m

The freshman classes could be swamped by people who aren't serious about getting a med degree. And why should they be serious?

This is not what medical school is like from the people I know.

Nobody has a bigger stick up their butts about how important their work is than medical students. Computer programmers (despite what reading comments here on HN would make you think) are at best a distant, distant second.

WalterBright
1 replies
10h5m

This is not what medical school is like from the people I know.

And those are people who are paying tuition.

paulcole
0 replies
5h35m

Post hoc ergo propter hoc.

Med school students aren’t competitive type A driven psychos because they’re writing tuition checks.

nicolas_t
1 replies
10h41m

I’m French and here overwhelmingly the best engineering schools are free with heavily subsidised housing. Admission to those schools is very competitive and students once admitted work hard at it and definitely value being there.

Private engineering schools tend to be seen as schools for those who couldn’t get in public schools but have parents with enough money to pay the fees.

So I disagree with you, keep in mind that there’s a significant barrier of admission to get accepted.

WalterBright
0 replies
10h10m

I'd be curious to know the dropout rates compared with paid tuition university.

bigfont
0 replies
15h50m

Unlike those in public high school, students who aren't serious about medical school won't have earned the entrance grades. So at least in first year, most students will have a serious attitude. Are you suggesting that someone will bust their ass for four years, only to start slacking once in medical school? Or that medical school entrance grades don't require serious study?

I can see what you mean about the halfway point. Maybe undergrad came easily, and at the halfway point, the student realizes that medical school simply isn't a good fit, or it's more work than they thought it would be. So they drop out. This is probably a good thing, to prevent people becoming doctors who don't have the chops or the attitude for it. Unfortunately, the school does lose some money on a candidate they ought to have filtered out in the interview.

Happily it's an empirical question, and we can circle back in a few years to see if the drop out rate increased or not. Maybe the drop out rate increases at first, and then the entrance interview becomes more stringent.

tintor
2 replies
14h43m

Rental cars and hotel rooms in your example are not necessarily free.

SoftTalker
1 replies
14h24m

They aren't, but the hotel doesn't charge you extra for leaving the lights on, so people don't care.

WalterBright
0 replies
10h11m

Right. The marginal cost to the customer for leaving the lights on is literally zero, so they have zero care about it.

This is why modern hotels have you put your room key in a slot that enables the lights to go on. When you leave the room, you take your room key, and the lights go out.

Evidently, people leaving the lights on is expensive enough to justify these key light switches.

dewey
1 replies
14h46m

There will always be bad people and outliers but most people are not behaving like that. There's many countries where "free" education and healthcare (In the sense that most of the cost is abstracted away in taxes) work.

It's definitely also cultural as you can see in many Asian countries where public infrastructure (parks, public workout machines, public toilets) are treated well and are in good shape compared to other places (My point of reference being Berlin).

WalterBright
0 replies
10h1m

Asian countries probably likely have a high level of enforcement against people who try to destroy public property.

For another data point, look at how clean and well-kept public "free" housing is compared with privately owned housing.

Or how those experiments with free bicycles were a miserable failure.

speedylight
0 replies
3h18m

I can be one of those of people, but I can also tell you there’s a bevy of other people in my life who never fail to annoy the crap out of me calling me out for leaving the lights on, using too many napkins, etc. Don’t lose hope, for every person that like me, there’s many more who are not

rldjbpin
0 replies
9h18m

people pay insane amounts of money and yet don't respect their degree to the extent you'd expect. just see how many people take up a course just for the sake of having a degree.

pchristensen
0 replies
16h37m

Do the N years of medical school classes count as sweat equity?

hx8
0 replies
15h28m

How is this very different than applying for and accepting a scholarship? Wouldn't this have approximately the same downsides as people that get full ride scholarships to University?

I trust the medical school admission process to select good students for their program. I'm sure with free tuition they'll have more than enough promising candidates.

elzbardico
0 replies
12h32m

Why?

bigfont
0 replies
16h6m

One way to have skin in the game is to pay a considerable sum of money to join medical school. This reminds me of the Commitment and Consistency chapter in Cialdini's book Influence. In part it says we stick with things more after we exert effort and especially so after public effort. With free tuition we take away some of the skin in the game, but students will still have to expend considerable effort to achieve high enough grades. That probably fosters commitment (and might explain why people with scholarships still tend to value school). In any case, we already have doctors whose parents paid for school, so even when free schooling does reduce commitment (and it probably will sometimes), at least this evens the playing field.

legitster
14 replies
20h0m

I'm not opposed to free tuition, but I kind of question the utility of a grant like this.

It's not like there's a requirement here that the doctors are going to work in the non-profit sector. It's not going to make the field less overworked and toxic. The students at this school have the same demographics as every other medical school.

Given that nearly all of the students who graduate from a medical program end up in the top 10% of wage earners, this seems like a temporary alleviation of financial problems for a very small cadre of well-to-do.

I am happy Dr. Gottesman felt such an affinity for her former employer, but it kind of strikes me as an ... uncreative(?) deployment of a billion dollars.

DylanDmitri
8 replies
19h47m

Doctors who graduate without loans have more leverage when deciding their next position. They can immediately go for research or volunteer work that otherwise wouldn’t recoup their costs.

_dark_matter_
3 replies
19h34m

My wife is a physician, and of the friends we made when she was in medical school, only one went to serve underserved populations. A big part of the reason he did so was because they would pay off his loans!

So maybe this will actually lose an effective lever at getting doctors to serve those populations?

phillypham
0 replies
14h59m

I don't think money is entirely the reason that doctors don't serve underserved populations. Many states with underserved populations like Missouri already pay more due to supply shortages [1].

The reality is doctors have the ability to practice anywhere and tend to choose desirable places to live like NYC, LA, etc because they are humans with wants and needs, too. Anecdotally, living in NYC, many doctors and dentists tell me they could make more elsewhere, but they love living in the city.

[1] https://comphealth.com/resources/physician-salary-report-202...

earthwalker99
0 replies
18h58m

By the dictates of capitalism, this can never make a dent. If it does, it must be undermined.

theGnuMe
2 replies
17h55m

Kinda, the big thing is residency which pays peanuts..

But there are tons of programs that will pay off your medical student loans if you go work in an undeserved area. Some states offer free tuition if you promise to work in that state for a few years after. The hope with that is that the person will establish roots and not leave.

Not to mention the 10 year Federal forgiveness for working in a qualified institution (aka nonprofit hospital/academic)

eigen
1 replies
14h15m

Not to mention the 10 year Federal forgiveness for working in a qualified institution (aka nonprofit hospital/academic)

Public Service Loan Forgiveness requires 10 years of making student loan payments.

Some states offer free tuition if you promise to work in that state for a few years after.

for example, the Georgia program offers up to $25k per year for up to 4 years max [1]. It requires application and takes into account health outcomes, specialty, debt, etc so it seems its not automatic acceptance. With an average medical school debt of over $200k this is not free tuition.

[1] https://healthcareworkforce.georgia.gov/loan-repayment-schol...

mixdup
0 replies
15h58m

They don't have to though. It would have been nice if they did something like it's free if you go work in an inner city/rural area/volunteer/etc etc but if you go into plastic surgery in Beverly Hills we're going to ask you to repay your tuition

Solvency
1 replies
19h46m

Seriously. I wonder if a billion dollars could have been used as a small step towards unfucking the byzantine middleman parasitic corrupt insurance-centric healthcare system instead.

toomuchtodo
0 replies
19h43m

Diminishing returns based on outcomes you can change in elections to put reps into Congress who will fix healthcare legislation. Sometimes you can, some races/districts you just have to wait out demographics.

Michael Bloomberg spent almost $1B trying to become president, and didn't even move the needle. That's capital inefficient; you want to target spend for maximum outcome return. This is a win, enjoy the hope for a moment, it's a long slog ahead.

Obligatory https://runforsomething.net/ and always vote PSA.

jonahbenton
0 replies
18h11m

My view: unless other top schools follow along, the donation will immediately and uniquely make Einstein interesting to top applicants who never otherwise would have considered it. The prospect of top students makes it more interesting to potential research staff, and the combination of top students and staff makes it more interesting for foundations and capital. Einstein right now is a circa top 50 medical school. Were there a futures market for this, I would bet in 10 years it will be top 25.

cupcakecommons
0 replies
15h10m

At the very least it will provide a really good real-world case study on deploying large sums of money to solve problems in society with seemingly no thought given to second and third order consequences. Definitely appears praiseworthy from first glance - really one of the major themes of our times.

slater
10 replies
20h49m

eliminates tuition fees

dangus
6 replies
20h41m

You aren’t interpreting this correctly, they are indeed eliminating all tuition, not just the fees.

titanomachy
3 replies
20h28m

“Tuition” is teaching. “Tuition fees” are the fees you pay to be taught.

Admittedly pedantic, but they are not wrong.

delecti
1 replies
20h24m

It seems that "tuition fees" might be a commonwealth term. In the US, the name of the fee is simply "tuition".

lupusreal
0 replies
20h9m

Correct.

https://en.wiktionary.org/wiki/tuition#English

(Canada, US) A sum of money paid for instruction (such as in a high school, boarding school, university, or college).

Synonym: (UK) tuition fees

Slater's correction may still be fair, despite the context of this being an American school, because it's a headline from a British website..

kopecs
0 replies
20h24m

“Tuition” is teaching. “Tuition fees” are the fees you pay to be taught.

Do you have a source for this? I am reasonably sure that in American English "Tuition" can certainly mean the fees you pay to be taught.

entropyie
1 replies
20h25m

Tuition is the act of teaching... I sure hope they aren't eliminating that. It is indeed the fees that are being eliminated.

recursive
0 replies
18h39m

No, tuition is only the cost associated. Or at least, it certainly can be the cost. I've never heard any other usage.

samatman
1 replies
20h12m

In the American dialect of English, the only meaning of tuition is the fees students pay to receive their education.

This school is located in America.

ejb999
0 replies
20h6m

Not always - 3 of my kids got awards that paid for their entire 'tuition' at a good state school in New England (USA). The 'tuition' was $1800/year - the fees added on another $14K, and then the housing and food added another $10K on top of that -

The state kept advertising how kids could get 'free tuition' if the met the academic requirements (combination of testing high enough and overall GPA) - but in reality, it worked out to less than 10% of the actual cost of attending this in-state, public university.

Was still nice to get the $1,800 off the bill, but it was hardly 'free tuition'.

PS: Not criticizing this medical school plan - just pointing out that the definition of tuition can, and does, vary - even in the USA.

rahimnathwani
0 replies
20h21m

Semantic drift :(

Scoundreller
8 replies
19h46m

Does the US let you forego capital gains taxes on unrealized gains when you donate stock, along with whatever benefit you get from donating money?

As a salaryman, I wish I got to donate pre-tax amounts! I get some credits, but if your income is high enough, it doesn’t even cover the taxes already paid.

takinola
1 replies
19h37m

Yes, donating stocks does not trigger a taxable event (YMMV, consult your tax attorney, etc). Not sure if it is possible to figure out how to donate pre-tax income (vs pre-tax gains). If you do, please share your knowledge.

Scoundreller
0 replies
19h24m

Not sure if it is possible to figure out how to donate pre-tax income (vs pre-tax gains)

Tax-efficient to get employers to donate money to charities of the employee's choosing in their honor maybe? Probably some opportunity for a startup here.

But I can see some employers not being too happy being linked with some of the choices, or employees being unhappy some of their favorites aren't on the list.

akashshah87
1 replies
19h40m

Yes, donating stock means you avoid capital gains. But even more relevant in this case is that she likely inherited the Berkshire stock from her husband which also resets the cost basis which means she wouldn't have had to pay capital gains even if she had sold the portfolio instead of donating.

Scoundreller
0 replies
18h48m

I don't know enough about US tax law, but I think it's more likely the donation was somehow done without triggering a huge capital gains tax bill. We're talking about a nonagenarian billionaire that founded an investment house.

Their death could be no surprise and the accountants/lawyers on speed deal would be limitless.

Surely they had their books in order, unless they wanted to pay tax.

bombcar
0 replies
19h15m

This only works for the first dollar after the you stop taking the standard deduction.

For most people, the standard deduction is freaking huge now due to the changes under Trump - for married couples in 2024 it will be $29,200.

So you have to have deductions that equal almost $30k before they start to "matter". If your itemized deductions would be about $10k (mortgage interest, perhaps, SALT, etc) you would have to donate $20k before you would start to see some effect from the donations.

There are still some ways to do pre-tax donations even without that, but you may have to involve estate-planning trickery.

gnicholas
0 replies
19h43m

Yes. You deduct the FMV, not the basis. There are some limits on deductions, especially when giving to foundations you control. But you can be sure that the donor has been well-advised on matching up this enormous deduction with similarly-sized realization events (i.e., selling other assets and generating taxable gains).

proee
7 replies
20h3m

Couldn't other Universities follow suit? Harvard sits on a $50B endowment fund, though maybe these funds are contractually obligated toward different causes.

proee
2 replies
19h32m

What if the parent are rich but won't fund their children's education? I guess they are SOL?

bombcar
1 replies
19h14m

There is a way to be declared an "emancipated minor" or equivalent, but it can be a pain in the ass (because otherwise all parents would decide not to fund so the kids can go free).

legitster
0 replies
18h55m

That actually doesn't work. Too many tried to game the system by getting emancipated.

If your parents refuse to pay or fill out the FAFSA, the only way to get off their income:

- They die

- You turn 24

- You get married

psychlops
1 replies
20h1m

How then would Harvard sort students by socioeconomic status?

Atotalnoob
0 replies
19h12m

They use FAFSA like every university

ldoughty
6 replies
20h22m

The interest should cover about 1750 students/semester (assuming about 10%)

The school has about 1250 students (Wikipedia). I'm guessing the difference comes from other sources.. or it slowly will drain downward.

Interesting to see nonetheless.

divbzero
1 replies
20h2m

10% interest seems like a stretch in today’s environment. 5% interest from US Treasuries would be a more reasonable baseline: yielding $50,000,000 per year total, or $40,000 per year for each of the 1,250 students.

wbeckler
0 replies
20h18m

You're assuming there was no need-based tuition program already running. Average tuition may not be full tuition.

thehappypm
0 replies
20h15m

Why would the school having less students than the interest can cover be a problem?

hn_throwaway_99
0 replies
16h29m

Assuming 10% interest is not realistic. The inflation-adjusted rate of return of the S&P 500 is 6.8%. Plus, the inflation rate of what it costs to train doctors has gone up at a much higher rate than the overall consumer price index.

dmurray
0 replies
20h8m

Not many investors would assume a long term return of 10% over inflation. If they target 7% instead, it would almost exactly fund that enrolment level.

Taikonerd
6 replies
20h31m

That's incredible. Imagine having $1B and open-ended instructions to "do whatever you think is right with it."

yieldcrv
2 replies
20h27m

They were married, that’s the default when a spouse dies

jprete
1 replies
20h17m

In this case her late husband left that specific direction.

abeyer
0 replies
18h15m

and a spare $1B

woah
1 replies
20h11m

Should've used it to pay some dudes in the Bay Area to do thought experiments about Roko's Basilisk

echelon
0 replies
19h56m

You obviously use it to build the Basilisk. That's how I interpret the instructions, neverminding the fact that this would make the Basilisk smile upon me.

FWIW, if an AI "satan" wins and becomes the hyper-advanced intelligence that rules our galaxy, it could just reverse simulate the light cone and torture each of us for all eternity anyway. It doesn't matter how good you are or which god you worship or how many "Hail Mary"s you say. We could be in that simulation now -- at any moment fire could erupt from beneath us.

elzbardico
0 replies
12h33m

Probably the donor specified that those funds MUST go towards tuition-free education. No way school managers would come out with this idea from their own volition.

SilverBirch
6 replies
9h38m

Call me a dirty European, but my first reaction to this is "This is why you're meant to have a working tax system". I agree that tuition for doctors shouldn't be usurious, but is this really the best use of $1bn? Imagine how much better we could make things if all the people who got rich off Berkshire Hathaway put their money towards good causes and we actually focused that spending on the best outcomes for everyone rather than just helicopter money for random pet causes. It's just such a weird system.

rldjbpin
2 replies
9h21m

as a dirty third-worlder, there are far worse ways to spend that kind of money. like someone else posted here, you can earn insane amounts of interest by sitting that money around somewhere. with that, it would have been possible to instead provide scholarship to select students every year for like perpetuity.

but this one relieves the donator from the responsibility and at the end of the day, a very selfless work. i would not judge it any beyond that.

scotty79
0 replies
5h36m

Of course you can do worse. You could buy weapons, and pay mercenaries to kill people and destroy infrastructure with them. The point is you can do so much better than let generation hoard this much of economical power and wait hundred years for some of them accidentally do something benficial with it.

SilverBirch
0 replies
7h28m

Yeah don't get me wrong, it's definitely a better thing to do with the money than some of the alternatives. It's just difficult to look at the system as a whole and go "Ok, so Xmillion kids in the US are going to go medical schoool this year, 99% are going to go into hundreds of thousands of dollars in debt, but these lucky 10,000 are going to get it for free".

Meanwhile, you look at that wealth and trace it through and think "Hang on, that's an incredible amount of wealth accumulated over decades. I wonder how much tax revenue that resulted in? $0.

mlrtime
1 replies
4h54m

I keep seeing this note about the European System.... if that system is so great then why aren't the best Medical Universities in the EU?

From my quick search a majority seem to all top-ten be in the US and UK. #16 gets you Karolinska Institute but even then they are followed by more US Medical Schools.

HDThoreaun
0 replies
2h18m

How do you rank medical schools? Id be extremely dubious about any ranking, especially when it comes to quality of grads.

RestlessMind
0 replies
35m

If Europe had a working tax system, how did both the richest man and the richest woman in the world were from France last year?

lnxg33k1
4 replies
12h14m

It is a great gesture, but if someone gets to have a spare billion to donate, makes me think that it could be the case to increase taxes and make institutions as vital as school be funded publicly and consistently by governments rather than random act of philanthropy

It’s mad that someone accrued billions and students can’t get 60k for free to study

I consider this kind of events more as a proof of the inadequacy of the system rather than the contrary

chii
3 replies
11h30m

increase taxes and make institutions as vital as school be funded publicly

studying medicine is not a right. Basic education is - but k-12 schools are publicly funded already.

hijodelsol
1 replies
10h46m

For each individual perhaps not, but there is a right to healthcare and out of this arises the need for physicians. And I for one would like the talent of the candidates to be the deciding factor, not their or in most cases their parents’ bank accounts. I’m a physician myself with an upper middle class background but if I lived in the U.S. I most probably wouldn’t be because of how cost prohibitive med school is over there. And this leads to all kinds of downstream effects like exorbitant physician later salaries on that render healthcare unaffordable for many and are detrimental to society.

lnxg33k1
0 replies
10h40m

I would also try to spark a thought about the effects that high debt might have on the decisions of doctors, to think that maybe if people weren’t buried by med school debt there could have been a different approach to oxy prescriptions or other pushes from pharma companies

Have countries with public universities suffered the same amount of opioids prescriptions epidemic?

lnxg33k1
0 replies
10h38m

It is not a right, thats why many countries have acceptance tests based on empirical results, not wealth based rights

giogadi
3 replies
19h43m

We actually already have many loan forgiveness programs for doctors - for example, they can choose to work at an understaffed clinic in a historically underserved area of the country and get huge amounts of their loans forgiven, on top of making a big salary. A lot of these clinics fully depend on this pipeline of doctors needing loan forgiveness. I'm not saying that this an ideal situation, but the loans can sorta encourage many doctors to practice where they are most needed.

dantheman
2 replies
19h34m

Loan forgiveness like other tax incentives merely distort the market. Just pay the doctors what it costs to get them there, we are probably over paying by giving loan forgiveness.

ilc
0 replies
19h18m

The free market does not solve all problems.

Sometimes it simply doesn't make economic sense to provide a service that people need.

Witness broadband availability and other things, and you'll see that the free market won't provide a service if it can't make money.

ikr678
0 replies
19h10m

Do the size of current loans not also distort the market/choices that junior doctors make?

burntwater
3 replies
19h56m

Just thinking through everything this implies. Would it be safe to assume this means some people if not entire departments will be laid off? Not as much need for financial aid, bursar's office, etc.

Overall it's a great thing, a more lean administration and better efficiency, but it's a small peek into what would happen if the U.S. ever gets single-payer healthcare (as I fully hope we do).

On a different note, if things like this became more common, with fewer new doctors having massive debt, that would pull down salaries and medical bills. How you view that depends on if you're a doctor or a patient.

ryandrake
0 replies
15h48m

They may do something to keep all the bureaucracy around, like structure things so they take money from one of their pockets and put it in the other, such that a staff is still needed to fill out paperwork and move money from one ledger to another. They might keep student loan administrators around to "loan" the students money, paid off by the endowment, securing the jobs of all the people doing all the overhead.

molave
0 replies
19h54m

It'll be similar to how horse drivers reacted when cars became popular, or painters with the advent of the camera.

cqqxo4zV46cp
0 replies
19h24m

How one views that isn’t completely influenced by which ‘side’ you’re on. Plenty of people are capable of not being completely selfish.

chrisjj
2 replies
18h14m

New York medical school eliminates tuition after $1bn gift

Oops BBC. Eliminates tuition /fees/.

OscarTheGrinch
1 replies
10h18m

Yes, "tuition" is the act of teaching, which I hope was not eliminated. Someone does not pay tuition, they pay "for tuition", Americans seem to have dropped the for.

Linguistic divergence is not a new phenomenon, perhaps we will have two completely different Englishes in a few centuries?

chrisjj
0 replies
7h50m

Someone does not pay tuition, they pay "for tuition", Americans seem to have dropped the for.

Given this headline doesn't say "pay" either. I don't see how restoring "for" can help it.

And note the headline is by the BBC - not Americans.

I put it down to error, not language.

selimthegrim
0 replies
15h50m

Cooper Union too.

testfoobar
0 replies
18h7m

This is a great, impactful donation.

Without any cynicism, I am curious what sort of negotiation and terms go into a donation of such size. As all the founders here can attest, taking money requires agreeing to a complex array of terms.

For example - what kind of protections are in place to preserve the donor's intent? Is there a board of directors for the donated funds that provides oversight? Could the med school 10X the salary of administrators and raise tuition equally? Could the med school hire 10X more staff? Could they relocate the med school to a 5 Star hotel?

People do funny things when vast sums of money appear.

stevage
0 replies
19h53m

Sounds like a very interesting experiment in economics is about to happen.

sillypuddy
0 replies
18h51m

For all those speculating about the impact, NYU Med School went tuition free in 2018. This isn't the first school to do it. It would be interesting to read what the actual impact has been to NYU.

shermantanktop
0 replies
13h36m

What a fantastic scrap to have fallen from the table of the ultra-wealthy!

Perhaps if we wait patiently by this here table leg, we can get cheaper prescription medication or some workplace safety. We can hope!

naveen99
0 replies
3h5m

If another 30-50% of med schools get this, full tuition private schools will have a hard time getting any merit students.

jostmey
0 replies
17h58m

How about expanding admissions to more students rather than making it free. With the earning power that clinicians command, they won't have trouble paying off the fees. But patients deserve more doctors and more talent deserves the chance to become doctors.

jongjong
0 replies
17h6m

It's not enough that governments use my tax money to subsidize my competitors and enable them to monopolize industries. Billionaires (who themselves are the beneficiaries of the scheme) are now also giving free money to my competitors.

I understand that the intent is good, but the effect is mostly negative. It's about cherry-picking one set of people and giving them an unfair advantage over everyone else.

The irony is that those who are in a position to be engaging in some kind of charity or philanthropy are the only ones who don't understand that the economy is a zero-sum game, by their own hand! It's a zero-sum game for everyone else except them.

johanneskanybal
0 replies
19h33m

Very us focused, why would you pay for university if you qualify? What else could be more in your country's interest?

iraqmtpizza
0 replies
10h27m

you could build a gothic cathedral with that money. what a waste.

huytersd
0 replies
20h26m

Damn, I wish I could get into here.

hentrep
0 replies
20h13m

Kaiser Permanente has something similar for their med school in Pasadena. In 2019 they announced free med school tuition for the first 5 classes (through 2024). Unsurprisingly this attracts top talent, and there don’t appear to be any sort of strings attached (eg, stay employed with Kaiser for X years once you finish).

Their acceptance rate was 50/11,000 applicants last year (0.45%).

[0] https://www.nbclosangeles.com/news/health-wellness/kaiser-pe...

emmelaich
0 replies
19h49m

Eliminates tuition fees.

These language shortcuts can be confusing for those of us not in the USA.

divbzero
0 replies
20h11m

The wealth came from David “Sandy” Gottesman’s investments, the most prominent of which was an early investment in Berkshire Hathaway. Gottesman was a friend of Warren Buffett, served on the board of Berkshire Hathaway, and also founded his own firm First Manhattan.

cryptoegorophy
0 replies
17h45m

As someone who went through college without loans and with part time work this is such great news.

bradleyjg
0 replies
17h21m

Let’s hope they have better trustees than the feckless ones Cooper Union had in the 90s and oughts.

RandomWorker
0 replies
4h2m

Doing the math one bil surprising would only pay for one year.. 60k a year, let’s say 15k students, your at 900mil right there.

DaleNeumann
0 replies
20h20m

"I wanted to fund students at Einstein so that they would receive free tuition," Dr Gottesman said she immediately realised. "There was enough money to do that in perpetuity."

I have never heard of a school getting this lucky from there alumni/faculty and even hearing there students getting something out of it so it touched my heart I have always had a toxic opinion about my teachers. Perhaps this could turn into an example for the rest of Americas medical schools in the coming decades.

000ooo000
0 replies
19h19m

Curious what kind of provisos come attached in arrangement like this. Surely it's not just the cynical that now expect a bit of bloat to appear, salaries to increase, wastage, etc. In 3 years time, $59k/y becomes $79k/y, obviously "due to inflation".