Domain Fine-Tuning vs. Retrieval-Augmented Generation for Medical Multiple-Choice Question Answering: A Controlled Comparison at the 4B-Parameter Scale

Abstract

Practitioners deploying small open-weight large language models (LLMs) for medical question answering face a recurring design choice: invest in a domain-fine-tuned model, or keep a general-purpose model and inject domain knowledge at inference time via retrieval-augmented generation (RAG). We isolate this trade-off by holding model size, prompt template, decoding temperature, retrieval pipeline, and evaluation protocol fixed, and varying only (i) whether the model has been domain-adapted (Gemma 3 4B vs. MedGemma 4B, both 4-bit quantized and served via Ollama) and (ii) whether retrieved passages from a medical knowledge corpus are inserted into the prompt. We evaluate all four cells of this 2x2 design on the full MedQA-USMLE 4-option test split (1,273 questions) with three repetitions per question (15,276 LLM calls). Domain fine-tuning yields a +6.8 percentage-point gain in majority-vote accuracy over the general 4B baseline (53.3% vs. 46.4%, McNemar p < 10^-4). RAG over MedMCQA explanations does not produce a statistically significant gain in either model, and in the domain-tuned model the point estimate is slightly negative (-1.9 pp, p = 0.16). At this scale and on this benchmark, domain knowledge encoded in weights dominates domain knowledge supplied in context. We release the full experiment code and JSONL traces to support replication.