http://www.forbes.com/forbes/2001/0514/090.html

Palm Tree M.D.s


On a recent morning 200 medical students drowse as a professor flashes slides of bile ducts overhead. Biochemistry at 8:30 a.m. is a tough slog anywhere. But at Ross University School of Medicine, located on the tropical island of Dominica, the students have something else to sweat about: In the U.S. medical profession, where they aim to have careers, their diplomas won't be taken very seriously.

But the diploma is still worth something. It entitles the bearer who passes the same tough licensing exam that U.S. med students take, and who fights his or her way into a hospital residency, to practice medicine. And so it is that the vendor of these offshore diplomas is worth something. Last April the school's founder sold a majority stake in Ross and its sister institution, the Ross University School of Veterinary Medicine on nearby St. Kitts, for about $135 million. The chief buyer was Leeds Weld & Co., a New York private equity firm specializing in for-profit educational ventures. Ross' board includes former Massachusetts governor William Weld; onetime Lazard lawyer Jeffrey Leeds; Chairman Benno Schmidt Jr., a former president of Yale who is also chairman of Edison Schools; and Bill Clinton's first chief of staff, Thomas F. (Mack) McLarty III. These guys are making a fair go of busting up the American medical school cartel, which uses tight accreditation rules to restrict the supply of doctors. "The U.S. system is designed to limit access to medical education," says Ross Chief Executive Timothy Foster.







The establishment, predictably, is howling. Last May the prestigious New England Journal of Medicine published an article attacking foreign schools like Ross, which aren't accredited by the American Medical Association's licensing boards. The other strike against Ross is that it's in business to make a buck. That conflicts with the public image projected by the medical profession: We're here to serve humanity. Hustle a dollar? Perish the thought.

Ross takes the quality challenge very seriously. It has to, considering its seedy origins. In 1978 grain trader Robert Ross convinced the government of Dominica, a lush, volcanic ex-British colony, to let him build a for-profit medical school catering to Americans whose MCAT scores didn't make the cut at any of the 125 U.S. medical schools. (Ross later gave himself an honorary doctorate from his own school.)

The students came to the oceanside campus. But behind the postcard scenery lay typical offshore problems. Failing a class used to mean repeating—and paying for—the entire semester. Admission standards were an oxymoron: Ross accepted 65% of all applicants, compared with 42% for U.S. schools, and never required the MCAT until last year. At one point the U.S. Department of Education flew in to investigate complaints by a teacher at a competitor school. (It took no action against Ross.)

These days the school attracts people who are hell-bent on being doctors, despite the disadvantages of the lowbrow Ross degree. Students seem to fall into two categories. Half are recent college grads who move to "The Rock" immediately after getting a stack of rejection letters. Jan Phillips, who wants to care for the elderly, graduated from Vanderbilt in 1998 and went home to Texas to get a master's in clinical gerontology. While working in a clinic at Baylor University's hospital, she applied to all the Texas medical schools. Phillips settled on Ross after she couldn't get in anywhere else.

Other students trade up from jobs in nursing, dentistry or other fields. Queens, N.Y. native Stacy Weiner was a physician's assistant for almost three years before deciding on an M.D. She bypassed U.S. schools altogether to avoid waiting two years while taking the MCAT and going through the application process.

Ross students take the standard U.S. medical school curriculum—but at an accelerated pace. The school has a three-semester year, allowing students to finish their four semesters of basic science quickly. After a fifth semester of early clinical training in Miami, Ross students do five semesters of clinical rotations in the U.S. at teaching hospitals in one of nine states, where they train alongside American med students.

No problem getting into Kern Medical Center, in Bakersfield, Calif., which can't lure enough med students from the affiliated University of California system to fill its program. A bit tougher to find a spot at New York University School of Medicine's top-notch Hospital for Joint Diseases, already flooded in the second half of the year with students who are trying to get into its orthopedic surgery residency program. To fill gaps in the first half, NYU takes a few Ross students each month, in return for a nominal administrative fee of $100 per pupil. None have become residents. How are the Ross students? "It's been variable," says Dr. Joseph Zuckerman, who heads the program. "Is it the same curve as students we see from other places? No."

It's up to Foster to get Ross student performance up to par. He once ran NovaCare Inc., a publicly traded outpatient rehabilitation firm based in King of Prussia, Pa., until sliding Medicare reimbursements spurred a fire sale in 1999. Weld, who was on the board of a NovaCare unit, hired Foster at Ross.

Foster is enforcing a new idea in academia: market forces. The 61 med school professors make an average of $60,000 to $90,000, with tax breaks on the first $75,000 for living outside the U.S. There's no tenure and, since they don't have to do research, they're paid on the basis of how well they teach. Pink slips are possible. Student evaluations and low exam scores have landed six profs on probation since last year.

With its reduced-stress tropical setting, Ross has drawn an eclectic faculty. Biochemist Gerhard Meisenberg, a 17-year veteran in colorful sandals who published a textbook while at Ross, wanted to live "far from Chicago." Julie Klotzbach, chairman of the pharmacology department, hated research and hoped to see her kids more often.

Foster is continuing to ratchet up academic performance. Two years ago Ross began requiring a school-administered "shelf exam" a semester before the compulsory U.S. Medical Licensing Exam Step 1 test, the first of three exams on the way to an M.D. Just half of Ross students pass the shelf exam the first time, 75% on the second go-round. Once they're allowed to take the Step 1, 82% to 94% pass on the first try. That's still shy of the 93% for U.S. medical students, but better than the 65% score for foreign med school grads as a whole. In last year's residency match, which assigns medical school seniors to a specialized training program in a U.S. hospital, 70% of Ross students got a spot, again besting overseas grads (52%), but falling short of U.S. medical school graduates (94%). Ross alumna Dr. Nancy Perri, the school's clinical dean, says 96% of graduates eventually find a program, some by negotiating directly with hospitals.

Is the school succeeding at its mission—making money, that is? Foster and his bosses say it is, but are mum on specifics. Here's some idea of what's on the profit and loss statement. Ross probably pulls in $58 million a year from tuition—$27,000 a year for three semesters for each of 2,100 students. Expenses at the two schools—including the costs of recruiting, a technology overhaul, road construction, hurricane and malpractice insurance (for students training in the U.S.) and overhead for the New York office—approach $50 million. Profit: probably less than $10 million, most of it reinvested in the school.

Ross has so far graduated 2,500-plus doctors who, in order to get certified, must pass a battery of exams, including the Test of English as a Foreign Language. Here's a test for the AMA: What does R-E-S-P-E-C-T spell?

Since Devry has purchased Ross the article is outdated. Devry is on the NYSE.

The NYSE and DeVry are really of little consequence. The school is still in the same place, doing the same thing...training doctors. What matters is their ability to pass the boards. DeVry just pockets tons of cash. The article isn't "outdated". it's just plain moronic.

The article is inaccurate because it makes it sound like Ross grads have to beg and grovel to get a residency. My gluteal they do. The value of a Ross diploma is equal to that of a US diploma once residency is over. There are many programs which have good experience with Ross grads, and will not hesitiate to grant interviews to, or hire Ross docs. Look at the match lists. Those aren't places that care how much you beg, they take you on your merit. G

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There was a letter written to Forbes by the dean of Ross (i think it was the dean). IT was pretty interesting. If someone could find it, it would be worth posting.

Andy

Ross University

Office of the Chairman and Chief Executive Officer

May 1, 2001

Mr. William Baldwin

Editor

Forbes Magazine

62 Fifth Avenue

New York, New York 10011

Dear Mr. Baldwin:

As you suggest in the Forbes (May 14th, 2001 edition) article entitled Palm Tree MD’s, the alumni of Ross University School of Medicine are “giving the haughty medical school cartel fits”. Is it because “their diplomas won’t be taken very seriously?” Of course not. To the contrary, the medical community already knows that our graduates include a nominee for the Nobel Peace Prize, the founder of the first women’s HIV clinic in the U.S., and innumerable Department Chairs and Chief Residents across the country. This cartel knows that one of our third year students just scored in the top three-tenths of one percent on their exam, the U.S. Medical Licensing Exam (USMLE) Step II. As Forbes points out, Ross students USMLE Step I first-time pass rates compare favorably to foreign medical school averages. At 82% to 94%, Ross students also outperform U.S. osteopathic students who typically achieve first-time pass rates of approximately 75%. While your article correctly states that 96% of Ross students are selected for U.S. residency training, you overlook the fact that 12% are so highly regarded that they are recruited by the medical establishment in advance of the residency match.

Your editorial “The Sugar Cartel and The Doctor Cartel” (also May 14th, 2001 edition) goes to the heart of the matter. While minority, inner city and rural communities go begging for family practice and other primary care physicians, the U.S. medical schools fill only 7% of their seats with African Americans (13% of the U.S. population), and they perpetuate the values which direct students into the more lucrative subspecialties and suburban markets. Ross University, in contrast, typically fills 18% of its seats with African Americans and graduates 67% of its students into primary care residencies. Dr. Enrique *********, former Vice Chairman for Academic Affairs and Director for Family Medicine Education at University of Miami School of Medicine, states: “In my experience Ross University graduates are very competitive academically and clinically with their U.S. counterparts. Patients frequently praise their dedication and empathy, which I think comes from their struggle to overcome the limits placed on them by U.S. medical education.”

Readers of your editorial might infer that cracking the medical school cartel is at the risk of increased malpractice or medical errors. The truth is that no study has ever been able to discern any difference in medical errors or malpractice between domestic-and foreign-trained physicians.

Oh yes, the AMA probably knows how to spell R-E-S-P-E-C-T but they’re just deathly afraid to sing it in public.

Sincerely,

Timothy E. Foster

Chairman and Chief Executive Officer

cc: Hon. Wm. F. Weld

This letter is in response to an article appearing in the May 14, 2001 issue of Forbes Magazine. To read the article, go to http://www.forbes.com/forbes/2001/0514/090.html.

This is an old thread but I was happy to see the posted letter in reply to the Forbes article. Another negative bit from The Smug One shot down.