This isn't entirely what happens. For most doctors at their first jobs the hospitals will write out most, if not all, of their medical school loans depending on how much there are. They use this as signing bonuses and to tempt doctors to their hospital.

Compare what I said:

> You don't [think] that would show up in what hospitals paid doctors?

to your

> the cost of medical school is reflected in doctor salaries.

Yes, I accidentally left out the word "think". But we're saying exactly the same thing.

Sorry, I thought you were implying that hospitals directly paid for medical school (ie. the way that some businesses will directly pay for an MBA).