Going to medical school today takes more than ambition, good grades in biology in college, and an appetite for hard work. It takes a willingness to incur a crushing amount of debt. Student debt in general is in crisis in this country. All told, borrowers owe $1.5 trillion, more than people owe in credit card debt or car loans.
People have borrowed money to attend medical school for decades, but the scale of the debt has skyrocketed in recent years, along with just about every other cost in health care. The average medical student now graduates with a debt burden as big as a home mortgage.
Now, one of America's top medical schools, NYU in New York, has come up with a radical solution.
It's a tradition on the very first day of medical school, the so-called white coat ceremony, a rite of passage for 24-year-old Joe Babinski and his hundred classmates at New York University.
Joe Babinski: It's kinda this transition point where you go from being a potential student to a member of the medical community even if you're at the bottom rung of the ladder still.
Lesley Stahl: (LAUGH) Yeah.
Joe Babinski: And it's-- it's a pretty significant experience. It marks the beginning of your journey, so to say.
As he began that journey, Joe was expecting to take on a great burden.
Lesley Stahl: How much debt did you expect you'd be taking on?
Joe Babinski: I anticipated taking on about $200,000.
Lesley Stahl: I can't imagine starting life with that on your shoulders. But a lot of medical students, a lot of young doctors have that. Most?
Joe Babinski: I would say most.
Dr. Ezekiel Emanuel: Graduating medical school, 85, 86 percent of students have debt.
Dr. Ezekiel Emanuel is chair of medical ethics and health policy at the University of Pennsylvania. He says the prospect of so much debt prevents many people who could be great doctors from even applying to medical school.
Dr. Ezekiel Emanuel: Most of us think that it really deters people from-- middle class and lower income families. They look at 200,000. It seems like a huge mountain to climb. And it gets scary.
Lesley Stahl: And it compounds because you're not paying it off.
Dr. Ezekiel Emanuel: Correct. And--
Lesley Stahl: So the interest grows. It gets worse. And that's a burden. I would think it-- it--
Dr. Ezekiel Emanuel: Well--
Lesley Stahl: --diverts attention from medical school as well if you actually--
Dr. Ezekiel Emanuel: I think people are stressed by it.
Third-year NYU med student Elaine De Leon has felt that stress from day one.
Lesley Stahl: Could your family afford medical school?
Elaine De Leon: Definitely not. (LAUGH) Definitely not.
Her family is originally from the Dominican Republic. Her dad is a retired chef. Her mother died years ago. She agonized over her dream of being a doctor because of the cost.
Lesley Stahl: How much did you have to borrow for your first year?
Elaine De Leon: I borrowed $76,000 and if I were to pay that off in-- on a ten-year plan it would be $100,000 by the time I paid it off.
Lesley Stahl: Wow. And that's just your first year.
Elaine De Leon: That's just my first year.
Lesley Stahl: It's unfathomable.
Elaine De Leon: Yeah. But I think that ultimately, like, a life of serving is more important to me. And that's really-- what-- what, like, cinched it, that I-- I needed to pursue this despite the debt that I would be accruing.
Elaine's ambition is to be a primary-care doctor treating poor people, but she says that the debt burden forced her to consider a different choice.
Elaine De Leon: Of course you hear the, like, s-- prime specialties where you get paid the most so you hear dermatology, you hear surgery, you hear all of these things. And so it's easy when you're coming in to be, like, well, I paid a lot of money to be here, like, I should really get my money's worth and try to pursue these more lucrative specialties.
Lesley Stahl: Even if you're not interested.
Elaine De Leon: Exactly. Or at least consider them.
Dr. Rafael Rivera is dean of admissions at NYU Medical School.
Lesley Stahl: What are the better paying specialties?
Dr. Rafael Rivera: Generally speaking, some of the surgical specialties tend to pay well. Neurosurgery. You know, orthopedics pays well. The fields that tend to pay a little less are fields like pediatrics, and general internal medicine, family medicine. And--
Lesley Stahl: And those are the doctors we have lacking. We don't have enough of those doctors.
Dr. Rafael Rivera: By 2030, we'll have a shortage of up to 49,000 primary care docs.
That huge shortage, that distortion of the medical profession, is directly linked to the mountains of debt. And on the day of that white coat ceremony last August, NYU decided to do something about it. Something dramatic. After all the first-year students had filed back to their seats, Ken Langone, chairman of the board of trustees, and his wife Elaine, let everyone in on a secret.
Ken Langone: "As of this very moment, the NYU school of medicine is now a tuition-free medical school. All…"
Joe Babinski was sitting in the front row, without a clue that was coming.
Joe Babinski: And they announce that they are supplying full-tuition scholarships for every student.
Lesley Stahl: Did you think you heard them right?
Joe Babinski: I-- I took a picture of the slide on my phone because I-- I didn't want them to remove it and take it away. (LAUGH) So I was like, "I'm-- I'm documenting that this is happening." (LAUGHTER)
Lesley Stahl: But did you get it right away? We were there. And there was a sense of, "Did I hear that right?" (LAUGH)
Joe Babinski: I-- I still don't think I get it.
Sitting a few rows away, joe's parents, a municipal employee and a retired cop, had a similar "Did he just say what I think he said?" reaction.
Joe's Father: "Oh My God"
This was the real-time reaction of another father.
DAD: "Oh My God… Oh!"
Dr. Rafael Rivera: At first, I see students looking around at each other.
Lesley Stahl: Did I hear what he said?
Dr. Rafael Rivera: Yeah. There were-- there were gasps, there was some quiet, there was some screaming. And then all of a sudden, the chants started getting louder and louder. And before you knew it, the-- the audience had erupted into cheers of joy.
NYU's free tuition applies not just to first-year med students, but to every current student in every class. They do still have to pay their own room and board, but for these students, it's a gift worth more than $200,000 each.
Ken Langone: And these kids went nuts. One father yells out, "I told you you picked the right place!" (LAUGHTER)
Ken Langone made his fortune as a co-founder of home depot. He and Elaine donated $100 million toward the free tuition initiative, and he helped raise the additional $350 million needed to make it a reality.
Ken Langone: Well, that's my job here.
Lesley Stahl: To go out and ask other people for money—
Ken Langone: Oh, I go out, and I look at somebody nice like you, and I grab you by your ankles, and I shake you.
Lesley Stahl: (LAUGH) The money comes out--
Ken Langone: And, when you promise me there's no more nickels, I turn you right side up. But seriously? I have two jobs here. I'm a cheerleader, and I'm a fundraiser.
Lesley Stahl: Tell us how this came about.
Ken Langone: Bob Grossman, when he became dean, I sat him down. I said, "All right, boss, what are we gonna do?" And he said to me, "One of the things I would love to have happen is for, one day, for us to be tuition-free." (UNINTEL)--
Lesley Stahl: He said that right in the beginning?
Ken Langone: Eleven years ago--
Lesley Stahl: When he first came? Ok.
Ken Langone: Eleven years ago. I said, "You know what, Bob? Let's do it."
It took more than a decade, but NYU now has the endowment to offer free tuition to every med student, in perpetuity.
Ken Langone: When we announced it, a mother, a pediatrician, came up to me, 30 years out of medical school, and she told me she was still paying off her medical school debt.
And she said, "This morning, when I woke up and I knew I was coming here," she said, "I was convinced I would be in debt when I died to help my son become a doctor." These are great people. So, we just say, "You know what? Let's do what we can to help make it easier for them."
Lesley Stahl: Do you think this is gonna make you a better doctor?
Joe Babinski: I think without a doubt it'll make me a better doctor.
Lesley Stahl: Really? How does it affect that?
Joe Babinski: For one, I won't be working while I'm in school. I can focus on learning the medicine and being good at it.
Lesley Stahl: And that pressure isn't on your shoulders.
Joe Babinski: There's none.
Ken Langone: I think about the mindset of a kid saying, "Somebody did something for me. Now, I've gotta do something for somebody." Okay? Think of that.
Lesley Stahl: Yeah.
Ken Langone: That's a big thing.
NYU's no-tuition model replaces what had been a patchwork system of scholarships and financial aid. Now, every med student is on full scholarship with absolutely no strings attached.
Lesley Stahl: This model says anybody who comes to NYU medical school will come tuition free as opposed to just the kids who need the money.
Dr. Ezekiel Emanuel: Right. I like the-- a model which I call forgivable loans. That you basically say to every student, "We're loaning you all of medical school. And if you go into primary care or one of these other specialties that needs doctors. Or you go practice in a rural community, like in South Dakota, or you go into an inner city community that's underserved, we're gonna forgive your loan. On the other hand, you decide you wanna go into one of those lucrative-- specialties, ophthalmology, or dermatology, or orthopedics, you're gonna have to pay it back with interest. And I think that's a more effective way of getting the goals society wants than giving everyone-- tuition free.
Whatever the model, changing the "face" of the medical profession is a huge challenge. Consider this: there are no more African-American men in medical school today than there were 40 years ago.
Right now, more than half of all medical students come from the richest 20 percent of American families, only about 5 percent from the poorest 20. This means that wealthy areas have lots of doctors, and lower income areas don't.
Lesley Stahl: I know of so many communities in-- in poor areas that don't have a doctor at all. No doctor. Is there anything in this program that encourages people to go out there?
Dr. Rafael Rivera: If you are from a rural background, you do tend to go back to practice in a rural setting more often than people who are not from a rural background. If you are from an underrepresented minority group, similarly, you also tend to go back to inner city underserved areas.
Since the announcement, applications to NYU have boomed, especially from minorities.
Elaine De Leon: I think just the idea that a lot of people who come from backgrounds like mine, low income, without parents who are able to afford medical school, I think that it's a huge draw. And I think that it's a needed draw for the patient population that's served by NYU students. I think that there's a lot of folks at Bellevue, where I work, this is just anecdotal but I would say at least 60 percent of the patients are Latinos and this is an excellent way to draw the right people to the right institution.
Lesley Stahl: How's your Spanish?
Elaine De Leon: Very good. (LAUGH)
Lesley Stahl: Excellent.
Elaine De Leon: Excellent.
Lesley Stahl: So they can-- you can really communicate with them.
Elaine De Leon: Yeah.
Elaine De Leon is in the final year of an accelerated three-year med school program, one year less than the norm. But when we saw her on the day of the announcement…
Elaine the day of the announcement: "You're not going to believe the news that just came out."
…calling her dad to give him the news, you wouldn't know she was saving just one year of tuition.
Elaine De Leon: Already I felt like one of the luckiest medical students in the country because I am in the three-year program, I'm already decided on primary care, I'm already going into this residency program here. And then all of a sudden it's, like, oh, and by the way, (LAUGH) like, your last year is free. And it's like, it was just this incredible feeling of freedom.
Lesley Stahl: So do you think all the other medical schools are going to at least try one model or another of free tuition?
Dr. Ezekiel Emanuel: Absolutely.
Lesley Stahl: They all will?
Dr. Ezekiel Emanuel: And-- and I-- I mean, I think almost all of the medical schools had been driving to that before NYU made its announcement. And I think they will redouble their efforts. This has been an issue that most deans of medical schools are passionate about.
They'd better be, because otherwise, those deans at Harvard and Hopkins and Stanford are likely to see the very best medical students attending NYU, for free.
Ken Langone: You have a right to push and say, "Why didn't you make kids who could afford to pay, pay?" Because we really wanted to be blind in terms of the kids coming here. And we want them to know that they owe us nothing. That, one day, if you're dealing with a patient who can't afford to have something done, you might say, "It's on me." Pass it on.
Produced by Rome Hartman. Associate producer, Sara Kuzmarov.