You’re stressed. Overworked. In tons of debt. As a healthcare professional, it can be tough to manage your job and your student loans — but there’s hope. If you work in healthcare, there are a few student loan forgiveness and repayment assistance programs for you.
The biggest program is The National Health Service Corps (NHSC) Loan Repayment Program. In this guide, we’ll give you the lowdown on everything you need to know.
What is NHSC loan repayment?
The NHSC loan repayment program offers various healthcare professionals student loan repayment assistance. This is in exchange for serving in a Health Professional Shortage Area (HPSA).
Professions that are eligible include:
- Primary care medical
- Mental and behavioral
- Certified Nurse-Midwife
- Dental Hygienist
- Dentistry (DDS,DMD)
- Family Medicine
- General Internal Medicine
- General Psychiatry
- Health Service Psychologist
- Licensed Clinical Social Worker
- Licensed Professional Counselor
- Marriage and Family Therapist
- Mental and Behavioral Health
- Nurse Practitioner (adult, family, pediatric)
- Nurse Practitioner (NP)
- Obstetrics/ Gynecology
- Physician (MD/DO)
- Physician Assistant
- Physician Assistant (primary care)
- Psychiatric/ Mental Health
- Psychiatric Nurse Specialist
- Women’s Health
As part of the program, there are full-time and half-time options available. You’ll work in an underserved area for at least two years at an eligible site. Search HPSA Find to see which areas qualify.
How much NHSC loan repayment funding is available?
The NHSC loan repayment program offers competitive student loan repayment assistance funding. How much you qualify for depends on the site you work and if you’re a full-time or half-time employee.
As a half-time HPSA site employee, a score of 0 to 13 qualifies you for up to $15,000 in student loan assistance. That award jumps to $25,000 if you work at an HPSA with a score of 14 to 26.
If you work full-time at an HPSA, you can get up to $30,000 with a score of 0 to 13. With a score of 14 to 26 you may qualify for up to $50,000. HPSAs are scored based on discipline, typically based on percentage of population and access, amount of people below the federal poverty level and travel time to resources.
Regardless of the award you receive in student loan repayment assistance, it isn’t taxable.
Areas of service
The amount of student loan repayment assistance under the NHSC loan repayment program is generous. However, it requires at least two years of service in an HPSA. These sites vary and include:
- Medical facilities in rural areas
- Medical facilities in urban areas
- State or federal correctional facility
- Free clinic
- School-based programs
- Other types of community clinics and more
The site must be approved by NHSC to qualify for this program. Every six months the program verifies that your employment qualifies. Expect to sign an In-Service Verification form and your site administrator will verify the hours you worked. Your site administrator will submit the completed form through the Bureau of Health Workforce (BHW) Customer Service Portal for review.
How to apply for the NHSC loan repayment program
The NHSC Loan Repayment Program is competitive. The program plans to offer 2,500 awards to eligible candidates in 2019. As of fiscal year 2017, there were 2,068 applications but only 181 awards made. Before you apply, make sure you’re eligible for NHSC loan repayment. You’ll need all of the required licenses and certifications.
After you’ve confirmed you’re eligible, submit an application online and provide supporting documentation. This includes your loan verification, disbursement report and other additional information.
According to its website, the application process takes about three weeks. If chosen for the program and you accept, you’ll need to provide direct deposit information to get the award.
Is the NHSC loan repayment program right for you?
The NHSC loan repayment program is the most known student loan assistance program for health professionals. But deciding whether it’s the right fit for you isn’t an easy answer.
Assess how much student loan debt you have and how much progress you’ll make paying off your loans under this program. For example, if you have $50,000 or slightly more, you can obliterate your loans through NHSC and be done with your debt.
Pursuing NHSC loan repayment and PSLF at the same time
But as a healthcare professional, you may be in six-figure debt. In this is your situation, weigh the pros and cons of NHSC versus Public Service Loan Forgiveness (PSLF). Under PSLF, after working 10 years at a qualified organization and making 120 payments, your remaining student loan balance is forgiven.
PSLF might have better odds than NHSC as you’re guaranteed forgiveness if you work in an eligible job and make payments for 10 years. Some borrowers may try to get student loan repayment assistance and forgiveness from both programs. But that’s where your repayment plan gets murky.
You’re required to make 120 payments under PSLF. Since the NHSC loan repayment program offers a lump sum award, it may only count as one payment. Here’s why that’s problematic.
Let’s say you have $150,000 in student loans. If you qualified for both programs simultaneously, after two years of NHSC, you could potentially get $50,000 in assistance. This only counts as one payment, so you need another 119 payments to be eligible for PSLF. This might put you closer to 10 years of service. In other words, your service at NHSC might not actually get you further in paying down your debt with PSLF.
Doing both of these loan forgiveness options could potentially backfire. Consider the pros and cons of each program by comparing the service requirements to your existing debt. It’s worth figuring out which program will help you get out of debt faster.
Need help deciding what is a good fit? Get in touch with us for advice and a custom plan!