Student Loan Forgiveness Programs for Health Care Workers: Options and Eligibility

Nurses, dentists, and other health care professionals make large investments in their education, which often means graduating with a high loan balance. Around 70% of medical students graduated with debt in 2023, and the average debt for those graduates was more than $200,000, according to the Association of American Medical Colleges.

Exploring student loan forgiveness programs for health care workers can be extremely helpful if you owe money for your education. This guide will help you understand your options to make debt payoff easier.

Federal loan forgiveness programs for health care workers

There are several federal student loan forgiveness programs for health care workers that can help you eliminate some of your student debt if you qualify.

Public Service Loan Forgiveness

For those with federal student loans, there's a very popular program that many workers across different industries can take advantage of.

“If you work in health care for a nonprofit or government organization, you could qualify for the Public Service Loan Forgiveness program, or PSLF,” says Domenick D'Andrea, an accredited investment fiduciary and co-founder of DanDarah Wealth Management. This program helps you eliminate a portion of your federal student loan debt, but there are certain requirements you must meet.

“You would need to be employed full-time at a qualifying organization,” D'Andrea explains. “You could also qualify if you work part-time at more than one job if you work at least 30 hours [per week].”

“You must make payments on an income-driven repayment plan for 120 months,” he adds. “Once you have reached all of these qualifying reasons, you can apply for PSLF. If you are approved, your loans will be forgiven tax-free.”

Income-driven repayment forgiveness

You can also qualify for income-driven repayment forgiveness if you repay your federal student loans with an income-driven plan. These plans set your monthly payments at a percentage of your discretionary income (5% to 20%, depending on the plan). Your repayment period is between 10 and 25 years (this also varies by plan).

Once you hit the end of your repayment term, your remaining loan balance is forgiven.

National Health Services Corps Loan Repayment Program

PSLF and income-driven repayment forgiveness are two well-known programs, but they're not the only options.

“There are other health care-related programs,” explains Jack Wang, a wealth advisor with Innovative Advisory Group. “A lesser-known program is the Health Resources and Services Administration Loan Repayment Program, but this has requirements regarding location and service time.”

This program, also called the National Health Service Corps Loan Repayment Program, provides:

• Up to $50,000 in loan repayment for all care providers or $75,000 for primary care providers who make a 2-year, full-time service commitment at an NHSC-approved site
• Up to $25,000 for all providers or $37,500 in loan repayment for primary care providers who make a 2-year, half-time commitment

Those who are proficient in Spanish can receive an additional $5,000 for their service commitment.

Indian Health Service (IHS) Loan Repayment Program

The Indian Health Service (IHS) Loan Repayment Program is another federal forgiveness program that offers repayment assistance of up to $50,000 to eligible health care professionals who work in health facilities serving American Indian and Alaska Native communities.

Participants in the program must make a two-year service commitment. Eligible care providers can extend their contract annually until their debt is paid off in full.

State-specific loan forgiveness programs

Programs on the federal level are open to all qualifying health care workers, but there are also local programs to consider.

“Many states also have loan forgiveness programs, or state income tax credit programs tied to student loans,” Wang says. “Again, many of these have a time or location requirement. Location means that the person works in an underserved or low-income area.”

These programs can vary depending on where you live. For example, the Pennsylvania Primary Care Loan Repayment Program offers up to $80,000 in repayment assistance for physicians, dentists, and psychologists working full-time for two years in federally designated health professional shortage areas. Other practitioners can qualify for up to $48,000 in repayment help for full-time work or $24,000 for half-time employment.

You can check with local professional organizations or your state's health department to find out your options for student loan forgiveness or loan repayment programs where you live.

Employer-based repayment assistance

Some hospitals and health care facilities have also begun offering repayment assistance as a workplace benefit to try to recruit qualified staff members. These facilities may offer:

• Tuition reimbursement
• Signing bonuses that can be used for loan repayment
• Annual contributions to the cost of coursework
• Student loan debt relief programs
• Loan repayment assistance

Check with your current employer if you have a health care role to see what options are available to you, or prioritize looking for jobs offering this benefit when searching for employment after graduation.

If your employer helps to cover the cost of your loans, this is sometimes considered a taxable workplace benefit, so be sure to learn the rules for your repayment program.

Current student loan refinance rates

How to qualify for loan forgiveness as a health care worker

Qualifying for forgiveness as a healthcare worker will depend on the kind of program you participate in.

If you're pursuing Public Service Loan Forgiveness, you must sign up for a qualifying income-driven payment plan with your loan servicer. You'll also need to use the PSLF help tool to confirm your employer is eligible. Once you've confirmed that your employer is eligible, you can use the help tool to generate a PSLF form that your employer will sign to certify your public service work.

If you're applying through another federal or state repayment program, such as the National Health Service Corps Loan Repayment Program, you'll typically need to make at least a two-year service commitment in an underserved area. You can complete an application online for these programs and find out what requirements you must meet.

Finally, if you're pursuing an employment-based program, you'll need to find out if your employer offers one, and meet your company's requirements for eligibility.

Tips for managing student debt while pursuing forgiveness

Even when participating in these forgiveness programs, it can still take time to become debt-free. As you work toward eliminating your student loans, there are a few ways you can reduce the burden your loans present. These include:

• Choosing an income-driven repayment (IDR) plan: If you have federal student loans, these plans are available and reduce the amount you pay each month to between 5% and 20% of your discretionary income. Participating in an IDR plan is critical to qualify for Public Service Loan Forgiveness, but you may want to choose this option even if you aren't pursuing PSLF because it can lead to loan forgiveness after your repayment term.
• Budgeting for loan payments: While you're fulfilling your service commitment to qualify for forgiveness, you still need to make on-time payments. Work your budget around the monthly amount you owe so you don't risk being late or defaulting, which could affect eligibility for forgiveness.
• Keep your documentation organized: You want to be able to prove eligibility for your forgiveness program, so keep careful records of your employment and your payments.