Loan Repayment Programs
The most important piece of advice we can give about loan repayment?
Loan repayment should not be the only factor you consider when choosing a job (or profession!). Choosing a job based solely because loan repayment is offered (while ignoring other factors about the job) may lead to job dissatisfaction, and ultimately, the loan repayment you signed up for may result in financial penalties if you leave the job before your commitment is fulfilled.
Terms you need to know
Loan Repayment
You already have a job with an employer. You apply for ‘x’ amount of money to be given to you or are given a set amount of money toward your student loan debt in exchange for service. Example: you agree to work three years for a facility and will receive $40,000 a year for each of those years of service.
Scholarship
You may or may not have a job. You apply for money toward a medical education you’re already accepted to. This may or may not come with a contractual service (or other) obligation.
Health Professional Shortage Areas (HSPAs)
A federal designation of an area (eg. A county) ranking the need for/shortage of health professionals. Learn more about HPSAs with 3RNET's HPSA guide.
Primary Care Office (PCO)
The federally designated person/office responsible for many tasks related to HPSAs and loan repayment programs. There is one PCO in every state; you can find a full list of PCOs here: https://bhw.hrsa.gov/workforce-shortage-areas/shortage-designation/contact-state-primary-care-office
Loan Repayment Basics
The Most Important Piece of Advice We Can Give
Loan repayment should not be the only factor you consider when choosing a job (or profession!).
Choosing a job based solely because loan repayment is offered (while ignoring other factors about the job) may lead to job dissatisfaction, and ultimately, the loan repayment you signed up for may result in financial penalties if you leave the job before your commitment is fulfilled.
Do not choose an opportunity just because it provides repayment.
Choose an opportunity and consider repayment a bonus.
A loan repayment program should not be the only factor when choosing a job.
Important Things to Know about Repayment Programs
Know that many programs—including National Health Service Corps—cannot be promised. There is an application process and things (such as HPSA scores) can change.
Most loan repayment programs approve funding for renewals first, then get into new applications. Funding for new applications typically starts at the highest HPSAs and continues until funding is depleted. Meaning that normally, the higher of a HPSA area you work in, the more likely your loan repayment application be approved.
Renewals are not guaranteed, however, once you are locked into a contract, you are locked in! For example, if the HPSA score of the facility you’re working at changes, it will not affect your current loan repayment, but could impact your ability to get a renewal.
Know the source of your funding. Program funding can be subject to budgeting.
Look at the history of the program.
Know the requirements for participation (reporting, etc.) for you AND your employer.
Virtually all programs are competitive—if recruiters and/or employers imply that such an award is guaranteed it probably is a community-based program, and these offers should be received in writing.
Penalties for defaulting are generally severe.
Federal and state loan repayment programs are restricted to U.S. citizens, but community-based or hospital/health system-based programs may welcome foreign medical graduates.
3RNET Network Coordinators are excellent resources since they are aware of federal, state, and local programs, which is important since regulations for one program may prohibit the use of another.
Common Loan Repayment Programs
Indian Health Service
Employment Status
Must be employed with Indian Health Service
Award Amount and Service Obligation
$40,000 toward repayment of your student loans for two years of service
Eligible Professions & Specialties
Many professions and specialties are eligible: advanced practice nurses, behavioral health, dentistry, medicine, nursing, optometry, pharmacy, physical rehabilitation, physician assistant, and other professions.
View the full list of IHS Loan Repayment eligible health professions here: https://www.ihs.gov/loanrepayment/lrpbasics/eligiblehealthprofessions/
Other Helpful Information
You may request an extension of your loan repayment annually in exchange for an additional year of service until all of your qualified education loans are paid.
Learn more
www.ihs.gov/loanrepayment
National Health Service Corps (NHSC) Loan Repayment Program
Employment Status
Must be employed at an NHSC-approved site
Award Amount and Service Obligation
Up to $50,000 full-time,$25,000 part-time for 2 years of service
Eligible Professions & Specialties
Physicians (DO/MD), Nurse Practitioners, Physician Assistants, Certified Nurse Midwives, Health Service Psychologists, Licensed Clinical Social Workers, Psychiatric Nurse Specialists, Marriage and Family Therapists, License Professional Counselors, Dentists, Dental Hygienists
View the full list of NHSC Loan Repayment eligible professions here:
https://nhsc.hrsa.gov/loan-repayment/nhsc-loan-repayment-program
Other Helpful Information
Which NHSC loan repayment program is right for you?
Learn more
https://nhsc.hrsa.gov/loan-repayment/nhsc-loan-repayment-program
NHSC Substance Use Disorder Workforce Loan Repayment Program
Employment Status
Must be employed at an NHSC-approved SUD site
Award Amount and Service Obligation
Up to $75,000 full-time,$37,500 part-time for 3 years of service
Eligible Professions & Specialties
Physicians (DO/MD), Nurse Practitioners, Physician Assistants, Certified Nurse Midwives, Health Service Psychologists, Licensed Clinical Social Workers, Psychiatric Nurse Specialists, Marriage and Family Therapists, License Professional Counselors, Substance Use Disorder Counselors, Pharmacists, Registered Nurses
View the full list of NHSC SUD Workforce Loan Repayment eligible professions here: https://nhsc.hrsa.gov/loan-repayment/nhsc-sud-workforce-loan-repayment-program
Other Helpful Information
Which NHSC loan repayment program is right for you?
Learn more
https://nhsc.hrsa.gov/loan-repayment/nhsc-sud-workforce-loan-repayment-program
NHSC Rural Community Loan Repayment Program
Employment Status
Must be employed at a rural, NHSC-approved SUD site
Award Amount and Service Obligation
Up to $100,000 full-time, $50,000 part-time for 3 years of service
Eligible Professions & Specialties
Physicians (DO/MD), Nurse Practitioners, Physician Assistants, Certified Nurse Midwives, Health Service Psychologists, Licensed Clinical Social Workers, Psychiatric Nurse Specialists, Marriage and Family Therapists, License Professional Counselors, Substance Use Disorder Counselors, Pharmacists, Registered Nurses, Certified Registered Nurse Anesthetists
View the full list of NHSC Rural Community Loan Repayment eligible professions here: https://nhsc.hrsa.gov/loan-repayment/nhsc-rural-community-loan-repayment-program
Other Helpful Information
Which NHSC loan repayment program is right for you?
Learn more
https://nhsc.hrsa.gov/loan-repayment/nhsc-rural-community-loan-repayment-program
NHSC Students to Service Loan Repayment Program
Employment Status
Student in your last year of medical, nursing, or dental school; must work at an NHSC-approved site.
Award Amount and Service Obligation
Up to $120,000 full-time in four annual installments (up to $30,000 per year) for 3 years of service
Eligible Professions & Specialties
Physicians (DO/MD), Nurse Practitioners, Certified Nurse Midwives, Dentists
View the full list of NHSC Students to Service Loan Repayment eligible professions here: https://nhsc.hrsa.gov/loan-repayment/nhsc-students-to-service-loan-repayment-program
Learn more
https://nhsc.hrsa.gov/loan-repayment/nhsc-students-to-service-loan-repayment-program
NHSC Scholarship Program
Employment Status
Scholars commit to this program during schooling, prior to employment. Once ready for employment, you must serve at an NHSC-approved site in a HPSA.
Award Amount and Service Obligation
NHSC provides financial support for full-time enrollment in an eligible primary care health professions degree training program for up to four school years including: payment of tuition and eligible fees; an annual payment for other reasonable educational costs, and monthly stipends to assist with living expenses while attending school.
Eligible Professions & Specialties
Students pursuing primary care health professions training may be eligible to apply. Learn more about eligibility here: https://nhsc.hrsa.gov/scholarships/eligibility-requirements
Other Helpful Information
This is NHSC’s most ‘restrictive’ program, meaning the penalties for backing out of your commitment are the most severe.
Learn more
https://nhsc.hrsa.gov/scholarships/overview
Nurse Corps Loan Repayment Program
Employment Status
Must be employed at a Critical Shortage Facility or serve as nurse faculty in an eligible school of nursing.
Award Amount and Service Obligation
Up to 85% of unpaid nursing education debt for 2 years of service
Eligible Professions & Specialties
Licensed Registered Nurses, Advanced Practice Nurses, Nurse Faculty
Other Helpful Information
You will receive 60% of your total outstanding, qualifying, nursing education loans over the course of two years. Once you complete your initial two-year service contract, you may be eligible to apply for a third year for an additional 25% of your original nursing educational loans.
These funds are not exempt from federal income and employment taxes.
Learn more
https://bhw.hrsa.gov/funding/apply-loan-repayment/nurse-corps
Nurse Corps Scholarship
Employment Status
Scholars commit to this program during schooling, prior to employment. Once ready for employment, you must serve at a Critical Shortage Facility upon graduation.
Award Amount and Service Obligation
Nurse Corps pays tuition, fees, other education costs, and a monthly stipend for a 2-year commitment
Eligible Professions & Specialties
Nursing Students
Other Helpful Information
Learn more about eligibility and how to apply here: https://bhw.hrsa.gov/programs/nurse-corps/scholarship/apply
Learn More
https://bhw.hrsa.gov/programs/nurse-corps/scholarship
State Loan Repayment Program (SLRP)
Employment Status
Differs by state/territory.
Award Amount and Service Obligation
Differ by state/territory.
Eligible Professions & Specialties
Differ by state/territory.
Other Helpful Information
SLRP is partially federally funded but requires a state or employer to match the money they give, dollar for dollar. SLRP programs are typically similar to NHSC (e.g. SLRP programs are required to follow the same breach penalty as NHSC), but as the state also contributes money, they may be more flexible in certain aspects (HPSA score needed to apply, etc.).
You can see which states participate in the SLRP here: https://nhsc.hrsa.gov/loan-repayment/state-loan-repayment-program/contacts
Learn More
https://nhsc.hrsa.gov/loan-repayment/state-loan-repayment-program
Other Programs
There may be other options to consider in the state you want to work, such as employer sponsored loan repayment or awards from private foundations.
Independent State Program
Many states have, through their own legislative processes, created financial incentive programs for health professionals. These programs will vary from state to state, searching online or connecting with your PCO are good ways to identify independent state programs.
Public Service Loan Forgiveness
If you’re employed by a government or not-for-profit organization, you might be eligible for the PSLF Program. The PSLF Program forgives the remaining balance on your Direct Loans:
Learn more about PSLF here: https://studentaid.gov/manage-loans/forgiveness-cancellation/public-service
Community-Based or Hospital/Health System-Based Programs
Some communities and even hospitals or health systems sponsor their own programs. Inquire with an employer during an interview or negotiation phase to learn more about these opportunities.
Where can you learn more about repayment programs in your state?
Rural Health Information Hub – https://www.ruralhealthinfo.org/funding/types
Primary Care Office - https://bhw.hrsa.gov/workforce-shortage-areas/shortage-designation/contact-state-primary-care-office
3RNET Network Coordinator - https://www.3rnet.org/Network-Coordinators
State Office of Rural Health - https://nosorh.org/nosorh-members/nosorh-members-browse-by-state/
University Financial Aid Office
If you know you’re interested in a specific program (ex: NHSC) contact the specific program.
Questions to Ask About Loan Repayment Programs
When exploring a potential loan repayment or scholarship program, it’s important to assess your risk!
Eligibility Requirements
- Is your discipline/profession included?
Service Commitment
- How long are you obligated to the program for?
HPSA Score
- Is it required you work in a HPSA to apply for loan repayment?
- If so, how high of a HPSA score has been needed for approval in the past?
Repayment Obligations
- What are the penalties if you back out of the service you’ve committed to?
Financial Benefits
- What amount of money (or other financial incentive) will you receive?
Application Requirements
- Are there certain requirements you must meet to apply?
- If so, what are they?
Tax Liability
- Some financial incentives can be subject to income tax!
- Be certain you are aware of any pertinent tax laws.
- NHSC programs are exempt from both state and federal income tax.
- Remember that even if you are going to work in a state with no income tax, there may be federal income tax to consider if a program is not exempt.
- When in doubt, check with your accountant.
Reporting Requirements
- Do you (or your employer) have to report any data back to your funder during the time you’re participating in the program?
- What do you have to report?
- When do you have to report it?