What to know about student loan forgiveness for doctors
With the average doctor graduating with six-figures’ worth of student loan debt, loan forgiveness programs can be imperative to tackling those balances
Written by
Writer
Stephanie Colestock has more than 11 years of experience in personal finances. Her work has been featured by MSN, CBS News, Credit Karma, and USA TODAY Blueprint.
Updated October 16, 2024, 3:01 AM EDT
Becoming a doctor involves many years of school and, as a result, hundreds of thousands of dollars in educational expenses. The typical doctor graduates with an average debt of $250,222 for public universities and $330,180 for private schools, according to the American Association of Medical Colleges. And with 73% of new doctors utilizing loans to pay for their education, that’s a lot of providers walking around with six-figure debt.
Paying off that much debt can feel daunting and could take decades. But if you’re eligible, you may be able to take advantage of student loan forgiveness for doctors. Learn more about the various loan forgiveness programs.
- Federal student loan forgiveness programs
- CARES Act relief for education debt
- National student loan forgiveness programs for doctors
- State-specific student loan forgiveness programs
- U.S. military repayment programs for medical loans
- Consider refinancing your medical school loans
Federal student loan forgiveness programs
If you took out federal student loans to pay for medical school, you may qualify for loan forgiveness programs in some cases. These programs allow you to have some or all of your student loan debt forgiven, rather than needing to repay the entire debt to the lender.
Public Service Loan Forgiveness
The U.S. Department of Education offers the Public Service Loan Forgiveness program, or PSLF, to eligible borrowers with Direct Loans. You may be eligible for forgiveness if you’re employed full-time by a government entity (federal, state, local, or tribal) or not-for-profit organization. This includes military service members.
In order to qualify for the PSLF program, you’ll need to have federal Direct Loans or consolidate your existing federal loan debt into a Direct Consolidation Loan. You’ll also need to be paying off that debt under an income-driven repayment (IDR) plan.
In addition, you must make 120 qualifying payments while working for a qualifying employer before any remaining balance is forgiven. Once you’ve made 120 qualifying payments, you can request that your remaining debt be transferred to a PSLF servicer and, hopefully, forgiven.
It’s important to note that in order to be eligible (even if you meet all other requirements), you’ll need to be employed full-time by an eligible employer both when you submit the forgiveness request form and when the remaining balance is forgiven.
Unlike some other loan forgiveness options, any remaining debt forgiven by the PSLF program won’t be considered income by the IRS. This means that the forgiven amount isn’t taxable.
Income-driven repayment plan forgiveness
To prevent your federal student loan payments from eating up too much of your monthly discretionary income, the Department of Education offers four income-driven repayment plans: Income-Based Repayment (IBR), Income-Contingent Repayment (ICR), Pay As You Earn (PAYE), and Revised Pay As You Earn (REPAYE).
If you qualify, you may be able to reduce your monthly payments to 10% to 20% of your discretionary income. Your monthly payment obligation depends on both your income and family size.
IDR repayment plans last for 20 to 25 years, depending on which plan you enroll in. After the plan repayment period ends, any remaining federal student loan debt will be forgiven.
All federal student borrowers are eligible for the REPAYE Plan. The IBR, ICR, and PAYE plans are only available to those with certain types of federal loans.
CARES Act relief for student loans
Under the Biden-Harris administration student debt relief plan, borrowers whose annual income was less than $125,000 for single people or $250,000 for joint couples could get up to $20,000 forgiven on federal student loans. If you received a Pell Grant, you’re eligible for the $20,000, but if you didn’t receive one, you’re only eligible for $10,000.
However, the plan was blocked and under review by the Supreme Court, with a decision to be made by June 2023.
Additionally, payments and interest on most federal student loans were paused through at least June 30, 2023. This postponement was set to expire 60 days after this date, or pending litigation on student loan forgiveness.
Note: The Biden-Harris administration relief proposal only applies to federal student loans. Private student loans do not qualify for this specific program.
National student loan forgiveness programs for doctors
If you have private student loans or don’t qualify for federal student loan forgiveness, other options are available exclusively to those in the medical field. These programs may allow you to get a portion of your student loan debt forgiven, simply for doing the job.
National Health Service Corps Loan Repayment
The NHSC Loan Repayment Program offers up to $50,000 in nontaxable student loan repayment in exchange for a two-year, full-time service commitment and up to $25,000 in student loan repayment for two-year, half-time service.
The NHSC offers forgiveness to eligible borrowers working at an NHSC-approved site who meet the following requirements:
- U.S. citizen or national
- You provide care in the Medicaid, Medicare, or state CHIP programs (or eligible to participate)
- Fully trained and eligible to work in the primary care medical, dental, or mental and behavioral health fields in your state
Applicants need to have eligible student loan debt resulting from education expenses required for their health profession. Applications are accepted on an annual basis; for more information, visit the NHSC Loan Repayment Program page.
National Health Service Corps Substance Use Disorder Workforce Loan Repayment
The NHSC Substance Use Disorder Workforce Loan Repayment Program, also known as SUD Workforce LRP, is designed to support healthcare providers helping combat the opioid crisis in the U.S. It offers up to $75,000 in loan repayment funds for three years of full-time service, and up to $37,500 for three years of half-time service.
In order to be eligible for this award, you must work at a SUD treatment facility classified in a health professional shortage area (HPSA), with a score that would normally be too low to qualify for funding. You must also meet the same eligibility requirements as the loan repayment program above.
To learn more, visit the NHSC SUD Workforce LRP page.
National Health Service Corps Students to Service Loan Repayment
With the NHSC Students to Service Loan Repayment Program, eligible applicants may receive up to $120,000 in loan repayment assistance (up to $30,000 per year for four years). It’s available to students in their last year of medical school, nursing school, or dental school in exchange for three years of full-time service or six years of part-time service at an NHSC-approved site.
This award is only offered to U.S. citizens or nationals who are enrolled full-time in their last year of medical, dental, or nursing school. They’ll need to be pursuing an M.D., D.O., D.D.S., D.M.D., N.P., C.N.M., or P.A. degree at an accredited school, and must be eligible for federal employment.
To learn more, visit the NHSC Students to Service page.
National Institutes of Health Loan Repayment
The National Institutes of Health (NIH) Loan Repayment Program can help eligible borrowers pay off up to $100,000 of their student loan debt in exchange for a two-year research commitment.
Loan repayment options from NIH are available to current employees as well as applicants who aren’t employed by NIH. Eligibility is limited to U.S. citizens, nationals, or permanent residents with an eligible doctorate-level degree. If selected, borrowers must also agree to perform two years of research service for 20 or more hours per week.
To learn more or apply, visit the NIH website.
National Institute on Minority Health and Health Disparities Loan Repayment
The National Institute on Minority Health and Health Disparities offers a loan repayment award of up to $50,000 per year to eligible health professionals. At least 50% of the awardees must be from minority populations.
To qualify, you must have student loan debt equal to 20% or more of your base salary and agree to perform at least two years of clinical research. You must also be a U.S. citizen or national and have a qualifying doctorate-level degree.
To learn more or apply, visit the NIMHHD website.
Indian Health Service Loan Repayment
With the Indian Health Service (IHS) Loan Repayment Program, eligible clinicians can receive up to $40,000 toward their educational debt in exchange for a two-year commitment to serving American Indian and Alaska Native communities. With this program, your contract can also be extended annually until all your student loan debt is satisfied.
To learn more or apply, visit the IHS website.
State-specific student loan forgiveness programs
If you don’t qualify for federal or national loan forgiveness programs, you may be able to find state-specific programs. You can do an internet search to see what loan repayment programs might be available in your specific state. Here are two examples:
Georgia Physician Loan Repayment
The Georgia Physician Loan Repayment Program is one of several programs offered by the Georgia Board of Health Care Workforce. This program offers $25,000 each year for an initial two-year contract to physicians practicing family medicine, internal medicine, pediatrics, OB/GYN, geriatrics, or psychiatry. To qualify, physicians must practice in a health professional shortage area in a rural Georgia community.
To learn more about physician loan repayment programs in Georgia or to apply, visit the Georgia Board of Health Care Workforce website.
Maryland Loan Assistance Repayment for Physicians
In exchange for a two-year service commitment to a health professional shortage area or medically underserved area, Maryland-licensed physicians may receive up to $50,000 per year toward their student loan debt. This program is available to physicians, physician assistants, and medical residents within their last year of residency.
To learn more or apply, visit the Maryland Higher Education Commission website.
U.S. military repayment programs for medical loans
Many education benefits are available to U.S. military members, including repayment programs for those choosing a career in medicine who wind up with student loan debt.
Air Force Health Professions Loan Repayment
The Air Force Health Professions Loan Repayment Program offers $40,000 per year for up to two years (for a total of $80,000) in exchange for a two-year, active-duty commitment. It’s available to service members in various health professions, and can be used toward loan payments, interest, and other education or living expenses.
Keep in mind that about 25% in federal income taxes will be taken out of the loan repayment funds before they’re disbursed.
To learn more, visit the Air Force Institute of Technology website.
Army Health Professions Student Loan Repayment
The Army Health Professions Student Loan Repayment Program is available to active-duty or reserve Army service members who work as a doctor, dentist, or other healthcare professional. If you qualify, you can receive up to $40,000 per year for as many as three years — for a total of $120,000 — toward your medical student loan debt.
National Guard Health Care Professional Loan Repayment
In exchange for a seven-year commitment to the National Guard, you can receive up to $250,000 toward your medical education debt. This is broken down as $40,000 per year for the first six years and $10,000 for the seventh year (with a lifetime cap of $250,000).
This program is offered to healthcare providers in the Medical and Dental Corps, but may also include physician assistants, social workers, and veterinarians, depending on the year.
To learn more, visit the National Guard website.
Navy Health Professions Loan Repayment
The Navy Health Professions Loan Repayment Program is available to new recruits, as well as existing, active-duty Navy service members. It offers up to $40,000 per year toward student loan debt (minus 25% for federal taxes, taken prior to disbursement).
To be eligible, you must be fully qualified, in your last year of residency, or enrolled full-time in your last year of study and working toward a medical, dental, or osteopathic degree. You must also be qualified for (or already hold) an appointment as a commissioned officer.
To learn more, visit the Navy Medicine website.
Consider refinancing your medical school loans
If you’ve considered all other options for paying off high-balance student loans or forgiving your medical school debt, but you don’t qualify or don’t have federal loans, you have another option: refinancing.
Refinancing your student loan debt, regardless of the balance owed, can simplify the repayment process and potentially save you money along the way. This process involves taking out a new private loan, which you’ll then use to pay off one or more existing lenders. You’ll make payments on the new loan moving forward.
With a refinance loan, you can:
- Combine multiple accounts into one, with just one monthly payment to manage.
- Lower your interest rate, saving money over the life of the loan.
- Reduce your monthly payment.
- Shorten your loan repayment term.
- Remove the debt obligation of a joint borrower, such as a parent who cosigned your loans.
It’s important to note that refinancing federal student loans into a private loan will mean giving up certain benefits, including income-driven repayment plans, student loan forgiveness programs, and forbearance or deferment. If you ever expect to be eligible for these programs or need those federal benefits, you may want to hold off on refinancing your federal loans.