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Student Loan Forgiveness for Doctors and Other Healthcare Professionals

Becoming a doctor is a marathon, not a sprint. After completing undergrad, passing the MCAT, finishing medical school and getting accepted into a great residency program you might think the hard part is behind you. Not only will you now have to survive medical residency, but your school loans will also start to come due.

While in medical school you may have been able to defer payments on your loans, but residents may no longer have that option. According to the website, Student Debt Relief, in “2016, the average medical school debt was up to $190,000, with about 25% of graduates carrying debts higher than $200,000.”

If you are one of the 86% of students graduating medical school with student debt, there might be some relief through debt forgiveness. Take a look at these federal programs to get started.

National Health Service Corps Students to Service Program

If you have not yet graduated medical school, but are looking into loan forgiveness, the National Health Service Corps (NHSC) Students to Service Program could support you for up to $120,000 in loan repayment. In exchange, doctors agree to work in health professional shortage areas (HPSAs) of greatest need for at least three years.

Some states might also have separate State Loan Repayment Programs that are administered through the NHSC.

Who is Eligible for the Students to Service Program?

To be eligible, you must first be a student in your final year of study as a primary care doctor, nurse, dentist, or a mental or behavioral clinician. You must also be a US citizen or national, eligible for federal employment.

How to Apply for the Students to Service Program

To apply go to the NHSC website. You will need to pass an initial eligibility screening first. If approved to continue you will need:

  • Identification information normally needed for a job application
  • A CV detailing your education, work, and volunteer background
  • Information on the loans you took out for your education
  • An essay responding to the prompt included in the application.

According to the NHSC website, “on average, it takes three weeks to complete an application, including all required and supplemental documentation,” so give yourself time to apply.

National Institutes of Health (NIH) Loan Repayment Programs

Are you going into medical research, rather than primary care? If you are selected for an NIH loan repayment program you could be awarded up to $35,000 annually in education debt relief. In return, selected students will commit to a two-year contract to perform research funded by a nonprofit organization in the US.

There are eight loan repayment programs, for details on each check out the NIH Programs webpage.

Who is Eligible for NIH Loan Repayment Programs?

One of the application requirements is education debt in excess of 20% of your annual base salary at the time of award. You must have earned your medical degree from an accredited institution. Finally, you must also be a US citizen, national, or permanent resident at the time of your assignment.

How to Apply for NIH Loan Repayment Programs

To apply and learn more about the specific awards and requirements for each, review the NIH website.

Indian Health Services (IHS) Loan Repayment Program

The IHS Loan Repayment Program is a loan repayment program that awards doctors up to $40,000 towards their student loans for practicing in American Indian and Alaska Native communities. This is a two-year commitment and doctors will be placed in the IHS facilities with the greatest need. There an option to extend the contract for doctors looking for further debt repayment support.

Who is Eligible for the IHS Loan Repayment Program?

To apply, you must be a US citizen with a valid medical license. If you are in your final year of school you can still apply, but will need to provide proof of a license before you can enroll in the program. American Indian, Alaska Native or IHS Scholarship Program recipients receive priority consideration for an LRP award.

How to Apply for the IHS Loan Repayment Program

To apply, head to the Indian Health Service website. Have your school transcripts, license to practice, employment verification, and loan documentation handy, as these will be required.

Military Programs for Medical School Loan Repayment Assistance

If you have already completed medical school or training, there are repayment options for doctors serving in the Army, Air Force, and Navy.

The Active Duty Health Professions Loan Repayment Program (HPLRP)

This is an Army program that offers up to $120,000 toward repaying medical school loans. Physicians must active duty servicemembers to qualify for loan forgiveness. The benefit is paid out in $40,000 disbursements over three years.

The Navy HPLRP

If you are in your final year of residency and working in a field that the Secretary of the Navy has determined there is a skill shortage, then the Navy HPLRP could offer up to $40,000 (before tax) in annual loan repayment for each following year served.

To apply, you can either be a current active duty medical professional, or a civilian physician interested in joining the Navy.

The Financial Assistance Program – Air Force

Medical students who sign on with the Air Force could receive $45,000 for each year in residency, and receive a stipend of over $2,000 a month to cover living expenses. Upon completion of your residency, you’ll have a one-year service obligation for each year of participation, plus one extra year.

The Financial Assistance Program – Army

Qualified Army service members could be eligible for up to $40,000 annually in education loan repayment. To apply, you must be serving in an Army Reserve Troop Program Unit, AMEDD Professional Management Command, or the Individual Mobilization Program. The most a service member can earn towards their student loans through this program is $250,000.

Public Service Loan Forgiveness (PSLF)

Public service includes full-time employment by a 501(c)(3) tax-exempt nonprofit or public institution (like some hospitals). It also includes working in areas that are underserved or have a high need for medical professionals.

This program isn’t specific to doctors in the public sector, but to many professions. While the timeline for forgiveness is longer than other federal options, your total balance could be forgiven at the end.

Who is Eligible for the Public Service Loan Forgiveness Program?

Borrowers eligible for PSLF need to make 120 qualifying payments while working full-time for a qualifying employer. Only Federal Direct Loans are eligible for PSLF.

The Federal Student Aid website includes complete descriptions of what a qualified payment, qualified employer, and full-time employment mean for PSLF applicants. However, the only way to be positive that you qualify for Public Service Loan Forgiveness now or in the future is to complete and submit the Employment Certification form as soon as possible.

How to Apply for the Public Service Loan Forgiveness Program

After 120 qualifying payments (over at least 10 years), borrowers can apply for PSLF. The payments don’t need to be consecutive to apply. You can then fill out and submit a PSLF application to receive loan forgiveness.

This article was written by Carolyn Pairitz Morris, Senior Editor at Earnest.

Disclaimer: This blog post provides personal finance educational information, and it is not intended to provide legal, financial, or tax advice.