Doctors and Hospitals Urge US Department of Education to Fix Civil Service Loan Forgiveness Program
May 09, 2022
Program unfairly excludes some doctors from California and Texas, hurting patients’ access to care in already underserved communities
Recently, the US Department of Education proposed sweeping changes to revise the Public Service Loan Forgiveness Program (PSLF) which was intended to provide loan forgiveness to individuals who engage in community service for 10 years. working in non-profit organizations.
The California Medical Association (CMA), California Hospital Association (CHA), Texas Medical Association (TMA), and Texas Hospital Association (THA) applaud these long overdue improvements. These organizations, however, urge the Department to address a significant issue that unfairly restricts some otherwise qualified physicians in California and Texas from participating in the program due to conflicting state laws.
Congress enacted the Public Service Loan Forgiveness Program in 2007 to encourage careers serving the public good and to improve access to health care by making it easier for physicians to pursue careers in community hospitals/clinics in non-profit. Unfortunately, when the US Department of Education drafted the implementing regulations, the regulations were tightened to require physicians to be “directly employed.” Because state laws in California and Texas prohibit most doctor jobs in hospitals, doctors from our nation’s two largest states were unwittingly excluded from the program, which doctors from the other 48 states participate in.
“This unfair denial limits California and Texas’ ability to recruit and retain physicians because they cannot receive the same loan forgiveness as the other 48 states,” said CMA President Robert E.Wailes, MD. “If not corrected, it will lead to an exodus of doctors from California and Texas, harming patients’ access to care in our underserved areas and exacerbating health care disparities in our minority communities. and marginalized.”
“The PSLF program also aimed to help low-income minority students pursue a career in medicine. Often these students return to serve in their communities when they become physicians. Fixing the PSLF would provide more equitable access to medical school and medical care in underserved communities in Texas and California,” said Gary W. Floyd, MD, president of the Texas Medical Association. “We urge the Department to ensure that physicians in Texas and California, who are dedicated to serving their patients and the public good, have access to this national loan forgiveness program.”
With an average medical school debt of $200,000, doctors are discouraged from practicing in California and Texas because they cannot get their loans forgiven, as they can in other states. California and Texas are expected to experience the two largest doctor shortages over the next decade due to population growth and aging and an aging medical workforce (about one-third of doctors have more 60 and half over 50).
“If doctors are drawn to other states where they can have their loans forgiven, Texas and California simply won’t be able to sustain a medical workforce that can meet the growing needs of patients in community hospitals, children’s hospitals and rural hospitals,” said Carmela Coyle, president and CEO of the California Hospital Association. “The PSLF program aimed to bring racial equity to health professions and reduce health care disparities for underserved patients. Failure to address the inadvertent exclusion of our physicians from the PSLF program will accelerate the worsening physician shortage and undermine the ability of hospitals to fully care for our most vulnerable and marginalized patients.
“Rural, nonprofit hospitals in Texas have long experienced physician shortages, and the COVID-19 pandemic has only exacerbated issues with access to care,” said John Hawkins, president and CEO of the leadership of the Texas Hospital Association. “Physicians in Texas and California must be allowed to participate in the PSLF program to ensure that rural hospitals can continue to serve their communities.”
“We need more doctors in the Central Valley, it’s as simple as that,” Rep. Josh Harder said. “We can bring more doctors to our communities by fixing the Civil Service Loan Forgiveness Program and it’s time to act. If we fix the exclusion of our doctors from this program, it will mean care more accessible and more affordable for everyone who needs it.”
Earlier this year, congressional delegations from California and Texas wrote to Education Secretary Miguel Cardona and told him that Congress had never considered excluding doctors from the country’s two largest states. when they created the program. The CMA, CHA, TMA and THA thank Congressman Harder, Senator Feinstein and Senator Cornyn for their leadership.
The CMA, CHA, TMA, and THA call on Secretary Cardona to ensure parity for physicians and patients in all 50 states. Our organizations have proposed a solution that provides a rigorous California and Texas equivalent to direct hospital employment, which we believe meets the intent of the original statute and Department standards.
(Please note that the proposed solution can be found in the link above and below.)