Student Loan Forgiveness: Start By Optimizing Existing Programs

There is a lot of debate about how to address student loan debt. We have yet to fully settle the presidential race, and there have already been calls for Joe Biden to cancel anywhere from $10,000 to $50,000 in federal student loan debt for each barrower. For people with less student loan debt this could be life changing. For physicians who funded their medical education with student loans, it’s unlikely to make any impact. As a doctor who comes from a very modest family, I know all too well how crushing this debt can be. Having substantial student loan debt influences all aspects of life from home buying to the decision to delay having children. Debt influences your choice of employer often taking employment opportunities which offer loan repayment programs or qualify for public service loan forgiveness (PSLF). Academic careers, and private practice are largely off the table for lower paying specialties such as family medicine or psychiatry. All of these factors depend on how much student loan debt you have, and many physicians are leaving school with $250,000 or more in student debt. 

I know what you are going to say. I need to take personal responsibility for the choices I’ve made. No one forced me to become a physician or fund my education with student loans. However, for many of us student loans are the only option for funding the education. While I agree and I do take personal responsibility for my career path, I still expect certain things like the process of obtaining PSLF to be clearly articulated. I became a doctor to help people, and each morning the best part of me leaves to take care of my patients. When I come home there is little left to give to my family. I am willing to give selflessly to the underserved communities that I work in, but I expect that PSLF will make good on their promise as well. PSLF is a program that was in place when I started repaying my loans, I work for a qualified employer, I complete my employment certification each year, and yet there is still significant doubt if I will receive forgiveness after 10 years of making payments. Many of my colleagues are facing the same difficult choices. Namely to enter a program with a suspect history of following through on their agreement or try to pay the student loan debt off in its entirety. 

What I would purpose to Joe Biden and his team is a plan to revise the programs that already exist. We can start with making the PSLF program clear and understandable to all barrowers. Information about qualifying employers, how to complete as well as submit documentation, and a more adequate way of tracking qualifying payments on a monthly basis. It would be beneficial to expand the number and type of employers who would qualify to take part in the program. Attempts to improve these issues have been made but the process remains cumbersome for many busy professionals. 

Another helpful change for many borrowers, is the proposed change to income driven repayments (IDR). These payments should be capped at 5% of discretionary income. At this time IDR payments are 10% discretionary income which is a significant amount of money each month. I like to think of this as a “additional 10% tax” I pay each month for attending medical school. 

Finally, we need incentives to retain physicians in the community and rural practice settings. Physicians may be sacrificing promising academic or private practice opportunities to provide a public service. There needs be some guarantee in place that assures the PSLF program will remain in place, and will forgive the balance of the loans once 120 qualifying payments are made.