The US Government Accountability Office (GAO) recently issued an unambiguously titled report, Foreign Medical Schools: Education Should Improve Monitoring of Schools that Participate in the Federal Student Loan Program. GAO was motivated to conduct a study on this issue for several reasons, related to issues both of quality and cost. In fiscal year 2008, USD 633 million in federally-guaranteed student loans were provided to US citizens enrolled in foreign institutions, including medical students. Meanwhile, a significant proportion (some 25 percent) of all practicing physicians in the United States are international medical graduates (IMGs)—i.e. US citizens or foreign nationals who have graduated from medical schools located outside of the United States and Canada.

Until now, relatively little was known about IMGs as a group, including their consumption of federal student loans and their performance on US medical licensing exams.  Among its key findings, the GAO determined that US medical students abroad borrowed USD 1.5 billion from 1998 to 2008. And while pass rates have improved for all IMGs—and most foreign institutions met in 2008 the long-standing 60 percent pass rate requirement—the IMG pass rates are still below those of US-educated graduates and “very few [foreign medical programs] would likely meet the newly enacted 75 percent rate” (mandated as of 1 July 2010). Perhaps most notably, the GAO found that the US Department of Education is missing key data that would allow for more complete enforcement of medical school pass rate requirements. 

To address these and other concerns regarding the use of federal funds for foreign study, on 20 July the U.S. Department of Education proposed new rules in this area, which touch on medical training specifically but also address broader issues of eligibility for non-U.S. institutions to participate in the federal student loan program. Among other things, the new rules aim to establish a definition of non-profit status for foreign institutions, articulate a “financial responsibility standard for foreign public institutions that is comparable” to that of domestic public institutions, and revise the maximum certification period for eligible participation in the U.S. federal student loan program. The public comment period on the new rules ends 19 August 2010, with more developments certain to follow.

Government Accountability Office
U.S. Federal Register – Aid proposal