A Guide to Student Loan Forgiveness for Health Care Workers
Health care workers are the backbone of society, and these loan forgiveness programs are here to show their appreciation.
July 4, 2022
After a welcome break from student loan payments during the pandemic, everything is set to resume by September. As you get your finances in check to prepare for the upcoming costs, it’s worth considering if there are any ways to clear or significantly reduce your student loan debt. And if you’re a medical school graduate (or working in a medical profession), you may be able to access student loan forgiveness for health care workers.
The topic of loan forgiveness can get pretty complex, with all kinds of eligibility requirements and nuances. However, we’ll run through the best options for health care workers and who can access them.
When will student loan payments resume?
When the pandemic hit in March 2020, the government paused payments on federal student loans and decreased interest rates to zero as part of the CARES Act to minimize the economic impact of COVID-19. If you benefited from the bill, you probably know this already.
However, this was a temporary measure. President Biden named August 31, 2022 as the end of the bill’s most recent extension, meaning student loan payments will resume in September. Although there’s some hope the administration will decide to extend the period again, this seems unlikely considering a government official revealed in May 2022 that the pause on payments would resume soon (without specifying a date).
When affairs go “back to normal,” not only will you have to resume payments, but you’ll also start incurring interest on your loan balances. Plus, collections agencies will once again be able to chase borrowers for their money.
If there was ever a time to look into student loan forgiveness for health care workers, it’s now. And fortunately, as a health care worker, you have more options than most.
Student loan forgiveness for health care workers: The options
Student loan forgiveness isn’t a universal program. There are many different initiatives run by different organizations, and each one has its own set of eligibility requirements and rules.
Whether you’re a pharmacist, dentist, mental health professional or something else altogether, you have a good chance of finding something that works for you. We’ll run through the top programs and then delve into what you can do if you’re not eligible for anything.
Public Service Loan Forgiveness (PSLF)
Perhaps the biggest and best-known loan forgiveness initiative is the Public Service Loan Forgiveness Program. This program pays off the debt of workers who commit themselves to working in the public sector — meaning you’re employed by the government or a not-for-profit organization.
To qualify, you’ll have to make 10 years of monthly payments under an income-driven repayment plan, then the government will cover the remaining loan balance. In addition, the PSLF Program is only for those with certain types of federal student loans.
You need to have Direct Loans to qualify. However, the Department of Education recently introduced a PSLF Waiver, which widens the PSLF program to Federal Family Education Loan Program (FFELP) loans consolidated into the Direct Loan Program, and those who ended up in forbearance due to active-duty military deployment.
The downsides to this option are that it requires a lot of commitment. In addition, approval can be difficult, with only 2.1% of applications being approved since the program began.
National Health Service Corps (NHSC) Loan Repayment Programs
The NHSC programs offer assistance toward your loans if you work for two or three years in a Health Professional Shortage Area (HPSA) approved by the NHSC. They’re available for both full-time and part-time workers.
There are three loan forgiveness options offered by the NHSC:
NHSC Loan Repayment Program
NHSC Substance Use Disorder (SUD) Workforce Loan Repayment Program
NHSC Rural Community Loan Repayment Program
Each option has slightly different eligibility requirements and offers a different amount of money. Private student loan borrowers are also eligible.
Between them all, a wide variety of health care providers can receive help, including physician assistants, midwives, social workers, dentists, pharmacists, psychologists and registered nurses (RNs).
Nurse Corps Loan Repayment Program
If you’ve graduated from nursing school, there are a few student loan forgiveness programs for nurses, such as the Nurse Corps Loan Repayment Program.
To qualify, you’ll need to work full-time for two to three years in a critical shortage facility or an accredited nursing school. In exchange, the program will cover 60% to 85% of your loan balance.
There are also plenty of state-specific programs out there, so be sure to do a quick search for your area and profession.
For instance, the Ohio Physician Loan Repayment Program offers up to $35,000 of loan forgiveness to eligible workers in the state.
Meanwhile, Iowa’s Health Professional Recruitment Program awards up to $50,000 to certain health professionals, including occupational therapists and podiatrists. Iowa also offers other loan repayment programs for health care workers — from primary care doctors and nurse practitioners to veterinarians.
As another example, Alaska’s SHARP Program offers support to medical, dental and behavioral health professionals.
Perkins Loan cancellation
If you’ve taken out a Perkins Loan, you could be eligible for its dedicated loan cancellation program. The Perkins program is mostly associated with teachers, but it’s also open to other professions, including nurses and medical technicians.
If you work in a qualifying full-time position for five years, you could have 100% of your loan balance forgiven.
Centers for Disease Control and Prevention (CDC) Epidemic Intelligence Service
Whether coronavirus inspired you to join the battle against diseases or you were in the field already, the CDC forgiveness program may be of interest. It’s a postgraduate fellowship lasting two years, during which you’ll research public health issues, including pandemics. You can receive up to $50,000 toward student loan repayment.
The fellowship is open to a wide variety of health care workers, including veterinarians, nurses, physicians and doctoral-level professionals (like pharmacists and scientists).
National Institutes of Health (NIH) Loan Repayment Programs
Even if you’re not a frontline health care worker, you may be able to qualify for support toward your student debt. The NIH programs are targeted at clinical researchers working in an NIH lab or for another qualifying employer focusing on a relevant field.
To be eligible, you need a doctoral degree and for your student loan debt to be at least 20% greater than your salary.
Indian Health Service Loan Repayment Program
Health care professionals who work with American Indian and Alaska Native communities can receive up to $40,000 of support for loan payments through the Indian Health Service (IHS). You’ll need to commit to serving for at least two years.
This program is open to a variety of professionals, including licensed acupuncturists.
What if I’m not eligible?
Although we’ve given a list of the most popular and relevant programs, it’s not exhaustive.
Even if you really don’t qualify for anything, there’s some good news. Rep. Carolyn Maloney (D-NY) is heading Congress's efforts to pass the Student Loan Forgiveness for Frontline Health Workers Act, which would offer complete student loan forgiveness to frontline health care workers.
Find the right loan forgiveness program for you
The vast number of programs offering student loan forgiveness for health care workers means you have a good chance of reducing your debt — or maybe even clearing it completely. Just don’t forget to read the fine print for each initiative, and make sure you keep up with the government’s latest plans for student loan forgiveness.
While loan forgiveness is a good option for student loan debt, you may have other types of debt as well. If you’re carrying credit card debt, try the Tally† credit card repayment app. It combines your higher-interest credit card debt into a lower-interest line of credit to help you efficiently pay down your balance.
†To get the benefits of a Tally line of credit, you must qualify for and accept a Tally line of credit. The APR (which is the same as your interest rate) will be between 7.90% and 29.99% per year and will be based on your credit history. The APR will vary with the market based on the Prime Rate. Annual fees range from $0 - $300.