New York University offers free tuition to all medical students The school announced it will cover the full tuition, currently $55,018 per year.

New York University medical students received life-changing news on Thursday -- the School of Medicine will cover full tuition going forward for all current and future students, regardless of need or merit.

The stunning announcement was made Thursday morning at the end of the annual "White Coat Ceremony," where new medical students are given white lab coats to mark the start of their M.D. degree program. At the same time, all current NYU medical students received emails saying the school is offering them full-ride scholarships too.

"Our last thing was to tell the students and their parents that, hey, tuition is going to be on us," Dr. Rafael Rivera, associate dean for admission and financial aid, told ABC News on Thursday. "It was awesome to see the emotions on their faces."

The skyrocketing cost of tuition can lead to hundreds of thousand of dollars in debt, which can be out of line with potential earnings, has been a source of much debate across the nation. Prospective doctors can carry some of the highest debt burdens.

According to the Association of American Medical Colleges, 75 percent of all doctors in the United States graduated with educational debt in 2017. On average, doctors currently graduating from a private school do so with $202,000 in debt. That debt pressure can steer new doctors away from research, community-based work and general practice, which may not be as highly paid as medical specialties.

NYU School of Medicine is the first private U.S. medical school and the only one ranked in the top 10 to offer free tuition to all its students, the university said in a press release. The yearly tuition costs covered by the scholarship are $55,018.

The free-tuition initiative began more than a decade ago when NYU created an endowment for that purpose. So far, the university has raised more than $450 million of the roughly $600 million it estimates it will need to fund full-tuition scholarships for all medical students "in perpetuity."

The move follows NYU's decision in 2013 to offer an accelerated three-year curriculum for its MD degree program, which also helps in cutting tuition costs.

The goal is to allow aspiring physicians "from all walks of life" pursue their passion with less stress, according to Dr. Robert Grossman, dean of NYU School of Medicine and CEO of NYU Langone Health.

"We thought it was a moral imperative because it's very difficult for medical students to incur the debt burden of medical school, as well as the additional time burden of training," Grossman told ABC News on Thursday.

Rivera said the daunting prospect of financial debt has an "adverse effect on patient care" by "scaring away" talented students from a career in medicine and, in effect, causing physician shortages and a lack of diversity.

"We don't want this debt to hang over their heads and persuade them from pursuing careers of passion," Rivera told ABC News.