Doctors versus Colleges

[dude1394]

There are two industries in the US which seem to need some serious market reform. Colleges and medicine.

http://www.democracy-project.com/archives/003525.html

Which field has higher cost inflation: colleges or medicine?

It might surprise many, especially subject to the barrages of schemes to nationalize medicine, that the cost of a college education has increased more than medical care.

For example, between 1990 and the present, in California’s state colleges and universities the cost of a college education has increased 350%, while the national cost of medical care has increased by 224%. Between 2001-2007, the national cost of a college education has increased 39%, while medical care cost has increased 28%.

Meanwhile, doctors average work week is 58 hours, while professors work an average 52-55 hours per week.

Doctors average compensation is about $128-thousand, about double the average for post-secondary teachers.

So, it’s not provider compensation that accounts for the higher inflation rate for college education.

What does, then?

Richard Vedder’s 2004 book, Going Broke by Degree: Why College Costs Too Much (AEI) says it’s because U.S. colleges are poorly productive, inefficient, and likely to use tuition money and state and federal grants to subsidize noninstructional activities, including athletics. One might add the huge fees paid to celebrity speakers who add little or nothing to education.

An inflated estimate of those Americans lacking insurance is about 19%, the real number about half who are in economic straights to do so.

Meanwhile, a recent poll by the Public Policy Institute of California has 66% saying that qualified students can’t move on to a college education due to costs. 75% of parents are worried about affording to send their youngest child to college.

Why isn’t there a public outcry for overhauling higher education?

Are, usually liberal, professors more willing for government to dictate others' profession than their own?

Note: Above statistics are from Bureau of Labor Statistics, Ibbotson, and Center for Research on Learning and Teaching.

FOR additional data debunking induced medicine hysteria, see today’s New York Times op-ed, “Economic View: Beyond Those Health Care Numbers.”

[mcsluggo]

the general pont of the article is fine.... but as usual people can't resist hyperbole th overstate their case (and thus weaken it considerably).

Why use the cost of CA state schools to proxy for overall eduacation costs...? Why? well the answer is obvious, because CA state schools had ZERO tuition back in th e80s and earlier, you only had to pay for fees. Nice baseline to choose, to overly belabor your point.

ALso, in what fantasy world do MDs only average $128k /year? that is absolute bullhockey.
http://bp0.blogger.com/_jyVH1tFBOXI/...ary-Survey.gif
I have no idea if this site is accurate, I just googled for it, but it is CERTAINLY more accurate than this other estimate...)

also... in what fantasy world to college professors work an average of 55 hours/week!

[Kirobaito]

Originally Posted by mcsluggo

also... in what fantasy world to college professors work an average of 55 hours/week!

Seriously. Most only teach for like two hours a day (if that), and have about 6 hours a week in office hours. They do other activities, there's no way it's 52-55 hours a week. I'm thinking like 30. Maybe.

[mcsluggo]

I was actually looking at this question (how much college costs are increasing) just a little while ago, as I decided how much money to pump into my three daughter's 529 accounts (essentially education IRAs).

over the past 20 years, all in private school costs have increased 5.3% and all-in for public schools have increased 6.1% over the same time period (I assume that averages costs for instate with costs for out-of-state students...?)

but in any case, this means that if current trends continue, my youngest (2yr old) can expect to see private schools costing about $100k / year by the time she leaves school (all-in costs) with public schools costing over $50k/year. (I am not certain that trends CAN continue at these rates, however)



....but, it is still an owie, WITHOUT resorting to stupid hyperbole...

[dude1394]

The question is where does all of the inflation come from wrt colleges? Is it driven mainly by the availability of federal/state funds for tuition or what?

I dont' see how the costs can go up 6.3% at a place where little investment in expensive technology occurs. The professors ARE the investment are they not?

It might be something like you see at an airline/pharmeceuticals. List price being outrageous because so many people are subsidized by the high payers. I just don't know but it doesn't really make sense to me.

[mcsluggo]

There is also a LOT of investment in infrastructure going on at colleges... there is a huge perceived need to attract students not just through academic reputations these days, but also through amenities... I think you'd be SHOCKED what is available to students at most schools these days.

[Mavdog]

having just experienced a large redistribution of income from my account into that of an institution of higher learning I can relate to this discussion.

whatever you anticipate in college costs for your kids, it won't be enough.

the primary driver of increased costs to the university seems to be 1) the seemingly unending quest to build more...whatever the physical plant that is there today isn't sufficient for tomorrow...they just keep on building bigger and better buildings, and 2) the larger and larger number of scholarships given, especially at private schools.

the profs do get a fairly good income, but their salaries are not that high.

the author mentioned above seems to believe (with no basis of fact mind you) that it is the institutions themselves are "inefficient", which would cause other schools who are more efficient to realize greaterdemand for student positions as they would be providing a less expensive education...yet it isn't cost that is the quantifiable measurement, as many schools who are perceived as the best in the field get a higher tuition compared with others less honored and kids are going to extremes to get admitted to these presitgious and expensive schools.

[dude1394]

Read a recent article by Thomas Sowell addressing the payback for a top-notch ivy-league school versus one that it more in line with your level of education. In other words someone "may" qualify for Harvard, but they would be better off at a less exacting school as they might perform better and not be over their head.

Just interesting.

[Mavdog]

there are schools that have the stellar reputation, earned or unearned, for educating students and because of that rep get the highest qualified students to apply...so it is a bit self-perpetuating, the cream of the student crop apply because that school is "better".

even when it is not "better". it takes a loooong time to change that perception.

do students at harvard for instance get a "better" education than a student at rice?

no, it's up to the student, not up to the school.

as I was counseling a hs junior this weekend, there are many, many good schools to choose from. don't be hung up on the name I said, go with what fits you as a person/student. many of these schools most people have never heard of, but they will do just as well (maybe better?) in preparing the student as the ivy's would.

but, a word of caution....these "no name" schools are just about as expensive as the ivy's are. some are more expensive.

because these "no name" schools are building new labs/dorms/classrooms/student centers to keep up with all the other universities, and they want diversity in the student body so they are giving out scholarships to those who otherwise couldn't afford to go.

[purplefrog]

I believe the reality is that in order to attract the best students our colleges/universities have to extend their marketing strategy to go beyond academics. Campus visits are the norm these days and parents and students are looking for up-to-date facilities, cutting edge technology, and a spectrum of nonacademic programs that will enhance the student's experience. While there is a tendency to think that the primary mission of academic institutions is the quality of the education (this should be true), it is becoming more and more true that parents/students are looking for "what type of amenities do we get?"

When it comes to athletic facilities alumni are usually responsible. Many times alumni are willing to make substantial contributions for a new practice facility or a new stadium/arena and nothing else. If the school wants the 20 million dollar donation then they WILL build the facility requested by the donor. So, when you see the annual improvements in athletic facilities this does not mean the cost is being passed on as a tuition hike. It is true that the o&m has to be paid for, but funding for the structure itself typically comes from a targeted donation.

As far as salaries for professors are concerned you should check out the salaries of college adminstrators and coaches first. The President of most major universities make several hundred thousand dollars/year plus stipends for housing. Coaches? Well you know the story there. The largest salary on most campuses is the football or basketball head coach. Professor salaries are next to nothing in comparison.

[wmbwinn]

Originally Posted by mcsluggo

the general pont of the article is fine.... but as usual people can't resist hyperbole th overstate their case (and thus weaken it considerably).

Why use the cost of CA state schools to proxy for overall eduacation costs...? Why? well the answer is obvious, because CA state schools had ZERO tuition back in th e80s and earlier, you only had to pay for fees. Nice baseline to choose, to overly belabor your point.

ALso, in what fantasy world do MDs only average $128k /year? that is absolute bullhockey.
http://bp0.blogger.com/_jyVH1tFBOXI/...ary-Survey.gif
I have no idea if this site is accurate, I just googled for it, but it is CERTAINLY more accurate than this other estimate...)

also... in what fantasy world to college professors work an average of 55 hours/week!

The average doctor does not make as much as you think. The lowest paid doctors are general pediatricians. Family practice doctors tend to make around 115K per year. Most non-surgeons in medical school systems/educational tracks make around 120-125K per year.

The doctors who make more than that are surgeons and some specialists whose job is heavy in performing procedures. Medicare is a system that favors doctors who perform procedures frequently. Reimbursement is significant for procedures and peanuts for clinic visits.

I suspect the 128K average for doctors is probably accurate or within 10K of accurate.

Obstetricians, general surgeons, Ortho surgeons make around 225K-300K. Some make more, some make less. Most doctors don't make more than that although some do. A busy interventional cardiologist may make 300K-400K per year. A cardiothoracic surgeon who is busy may make 500K.

But, on average, I suspect the quoted article is probably correct.

[Jack.Kerr]

Originally Posted by wmbwinn

The average doctor does not make as much as you think. The lowest paid doctors are general pediatricians. Family practice doctors tend to make around 115K per year. Most non-surgeons in medical school systems/educational tracks make around 120-125K per year.

The doctors who make more than that are surgeons and some specialists whose job is heavy in performing procedures. Medicare is a system that favors doctors who perform procedures frequently. Reimbursement is significant for procedures and peanuts for clinic visits.

I suspect the 128K average for doctors is probably accurate or within 10K of accurate.

Obstetricians, general surgeons, Ortho surgeons make around 225K-300K. Some make more, some make less. Most doctors don't make more than that although some do. A busy interventional cardiologist may make 300K-400K per year. A cardiothoracic surgeon who is busy may make 500K.

But, on average, I suspect the quoted article is probably correct.

Interesting. But where is your info coming from?

[wmbwinn]

Originally Posted by Jack.Kerr

Interesting. But where is your info coming from?

Personal knowledge.