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Young Dentists in Debt

by Phil Cornell

Before Dr. Misty Sidoti-Melillo ('98) opened her practice last winter in Byram, New Jersey, she reflected on those to whom she was indebted for her education. How could she ever repay them? The answer was $2,000 a month ­ the rate of reimbursement needed to satisfy her student loans.

Shakespeare may have counseled "Neither a borrower nor a lender be," but the bard never had to pay his way through dental school. Debt is a fact of life for the vast majority of students at not just New Jersey Dental School but similar institutions across America­and that tide of red ink swelled considerably in the 1990s.

The average educational indebtedness accumulated by dental school graduates across the United States surged from $54,550 in 1990 to $84,089 in 1998, a 54% increase over eight years, reports Gina Luke, public affairs officer for the American Association of Dental Schools (AADS).

At NJDS, the average debt load of a graduate more than doubled during theprevious decade, from roughly $40,000 in 1990 to about $85,000 in 1999, says Michael S. Katz, university director of financial aid. (Both sets of figures include all loans a student has amassed since graduating high school.)

While Mr. Katz estimates that 85% of NJDS students graduate with debt, the figure stands at 93% of graduates nationally as of 1998, says Ms.Luke. She adds that 69% of private school graduates nationally and 26.4% of their public school counterparts owed more than $100,000. During this same time frame, the percent of graduates with no debt or lower levels of debt has declined, while the percent with debt between $100,000 and $150,000 has increased.

That would sound right to Dr. Gabrielle Lobato ('98), who is pursuing a postgraduate specialty in endodontics at NJDS and figures she'll owe $140,000 by the time her schooling is completed. Also more than $100,000 in the hole is Dr. John Nosti ('98), who opened a practice last year in Matawan with fellow alumni Dr. Shalin Jani ('97) and Dr. William Scott Steiner ('98). Why all the borrowing? Recent grads point to the increased costs of education. Dr. Steven Cohen ('96), for example, says he shelled out more than ten times the $1,500 that his father, Dr. Burton Cohen ('67), paid yearly for tuition when he started dental school in 1963.

The 1999-2000 estimated costs of four years at NJDS are $115,645 for state residents and $150,689 for out-of-state residents, according to figures supplied by the AADS. Those estimates include a four-year tuition tab of $62,036 for residents and $97,080 for out-of-staters; equipment ($6,719 over four years), fees, insurance and living expenses ­ the last adding $41,866 to the tally. The total costs are comparable to those at other public schools in the Northeast: the State University of New York at Buffalo estimates four-year dental school costs at $104,606 and $149,006, respectively; SUNY at Stony Brook's estimates for 1998-99 were $114,468 and $158,708. At the University of Pittsburgh, the 1998-99 estimates were $143,290 and $178,170.

While these amounts may seem imposing, they hardly cover the full cost of a student's education, notes Ms. Luke. "Dental education is subsidized by the federal and state governments, and by the school," she comments. "What a student pays is far less than what it costs a dental school to provide the education."

Increased borrowing requires increased lending, and the availability of credit is also cited in the soaring indebtedness. One major source of funding for dental students is the federal government's Stafford Loan program, which provides both subsidized and unsubsidized loans at low interest to borrowers. In 1995, the Stafford loan cap of $138,500 was lifted for certain health professions schools, and today stands at $189,125. Although New Jersey Dental School students may now borrow up to the new maximum, they were unable to do so until last July, when the Department of Education changed its policy.

In addition, future dentists are more attractive to private creditors, as salaries in the profession boomed in the 1990s. "Today's dental school graduates can expect a big return on their educational investment," says Dr. Richard W. Valachovic, executive director of the AADS. "The dentalprofession is in the top 5% of the nation's wage earners. Dentists' salaries on average have increased by nearly 50% between 1990 ($94,000) and 1998 ($140,000), far in excess of inflation."

Then there is the notion that today's students are not as frugal as their predecessors. "Increasingly, students want to live the life of a dentist before they are one," Ms. Luke says. "The problem with this kind of behavior is that it can lead to a dentist living the life of a student."

"A lot of these people graduate, and they have debt the amount of a home mortgage without the home," she adds. "Dental degrees are still an excellent investment . [but students] are accumulating debt that perhaps they didn't have to accumulate in the first place."

Dr. Zia Shey ('73), associate dean for student affairs and graduate dental education at NJDS, reasons that today's young graduates were teenagers in the 1980s and absorbed the consumerism of that time. "When I was going to school, I could have a clunker car for $200 and I was happy with it. Today, you see dental school students with nice shiny cars," he says. "Did I make a mistake or did they make a mistake? Maybe I made a mistake. What's the purpose of a having a new shiny car when you're 65?"

"Today, the students are saying we are a person first and a student second. I think that's healthier."

Sooner or later, though, a day of reckoning arrives and the debt must be confronted. Rather than try to obtain yet more financing to start or purchase a practice, a new dentist could feel a pressing need for income and decide to work for somebody else. Mark Millstein, director of dental health for the New Jersey Dental Association, says a typical story he hears from grads is: "I'm deluged with loans. I want to start paying some of them back." They may work six days a week in two or three practices to do so, Mr. Millstein adds.

Drs. Nosti, Jani, and Steiner indeed work part-time outside their own practice to make ends meet, which can mean 50 to 60 hours at their profession a week. "It's not banker's hours," says Dr. Nosti of the double duty. "We're definitely working hard. But you have to do it sometime in your life."

As for Dr. Sidoti-Melillo, she consolidated her debts, obtained a lease with a balloon payment, and works 12 to 16 hours a day without an assistant ­all the while savoring the satisfaction of running her own practice at her own pace.

But children, the newlywed concedes, will have to wait. "I have no idea how I'm supposed to fit children into this," she says. "Maybe if I win the lottery and pay off my debt or sell the practice. There's a lot of things I can do; I haven't thought of them. I'm just focused on paying off my debt and getting this business going."


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