Programs and strategies to pay off six-figure medical school debt

Forgiveness, repayment assistance and more for healthcare professionals.

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Becoming a doctor is an investment. Medical students graduate with some of the highest debt loads out of any profession. Luckily, there are also many repayment assistance and forgiveness programs meant to help healthcare professionals afford lower-paying jobs.

Average medical school debt

Medical students graduated with a median debt load of $192,000 in 2018, according to a study by the Association of American Medical Colleges (AMCC). More than 20% of all medical students who went to a private school graduated with over $300,000 in debt. That’s more than some student loan refinancing companies like College Ave and Discover are willing to work with.

Since federal loans have caps on how much you can borrow, many medical students graduate with a combination of federal and private student loans.

What’s the average cost of medical school?

The average cost of attending a public four-year medical school was $243,902 in 2017, according to the AMCC. However, attending a private school costs students a whopping $322,767.

That high price tag is likely a major factor for why only 32% of students enter with student loans, but more than 70% leave with debt.

Forgiveness and repayment assistance for healthcare providers

You could qualify for forgiveness or a loan repayment program (LRP), especially if you go into public health. Since not all types of loans are eligible for these programs — and many have limits to how much you can qualify for — you might need to apply for more than one to get rid of your entire debt load.

Public Service Loan Forgiveness (PSLF)

Considering working in public health or safety, joining the Peace Corps, AmericaCorps or military, or even teaching? You might want to consider this popular forgiveness program.

You can qualify to have all of your federal loans forgiven after making 10 years of qualifying repayments. Plus, if your residency program meets the criteria for employment, it could count.

National Health Service Corps (NHSC) Loan Repayment Program

The NHSC Loan Repayment Program offers student loan forgiveness in exchange for two years of service in a Health Professional Shortage Area (HPSA). After your initial term, you might be eligible for even more forgiveness if you extend your contract. Forgiveness through this program is not counted as taxable income.

You can find out if your community qualifies as a Health Professional Shortage Area by visiting the Health Resources and Services Administration website.

National Institute of Health (NIH) Loan Repayment Programs

The National Institute of Health (NIH) Loan Repayment Programs are geared toward medical researchers who work at the NIH as well as other nonprofits or government agencies. Qualified applicants can receive up to $70,000 for a two-year award as long as you have at least $140,000 in eligible debt — including federal and private student loans. You can renew the award in one- or two-year increments as many times as you’d like.

National Health Service Corps (NHSC) Students to Service Loan Repayment Program

The National Health Service Corps Students to Service Loan Repayment Program is designed to encourage soon-to-graduate medical students to work in an HPSA — meaning you might have to move.

In exchange for partial student loan forgiveness, students are asked to commit to three years working full time at an NHSC-approved site in an HPSA. After the initial term, you can sign up for additional one-year service contracts in exchange for more forgiveness.

Health Professions Loan Repayment Program (HPLRP)

The Health Professions Loan Repayment Program (HPLRP) is meant to encourage new doctors to enter the Navy and current Navy members to reaffirm their active-duty commitment. You can’t apply online, but instead have to go directly through a Navy Medical Programs recruiter.

Repayment assistance through this program counts as taxable income, so you might receive approximately 25% less funds than you qualified for.

Faculty Loan Repayment Program (FLRP)

The Faculty Loan Repayment Program (FLRP) is designed to diversify the faculty in healthcare programs by providing loan repayment assistance to instructors from disadvantaged backgrounds.

Unlike some other LRPs, you need to already have a contract to teach for at least two years in order to qualify. Your school also has to pledge to match the FLRP’s award or provide a waiver. FLRP awards are taxable, so the program withholds 39% of the funds to pay the IRS.

5 tips to pay back medical school debt

Don’t qualify for any of those loan repayment programs? Here are a few ways to get your med school debt under control:

  • Sign up for an income-driven repayment (IDR) plan. If you’re in a low-paying job with high monthly repayments, an IDR plan can make your federal loans more affordable in the short term. And the government forgives the remaining balance after 20 to 25 years of repayments.
  • Consider state and local options. Healthcare forgiveness programs are also popular at the state and local level. Check with your state’s Department of Health and Human Services to learn about your options.
  • Refinance instead of deferring during your residency. Got an inflexible repayment plan with a private lender? You might want to consider residency refinancing loans to keep repayments affordable on a resident’s low salary.
  • Refinance or consolidate — after your residency. If you get a high-paying job after you leave your residency program, you might be able to qualify for lower rates, more favorable terms or at least more manageable repayments than before.
  • Be strategic about repayments. Sometimes there are better alternatives to consolidating or refinancing your loans — especially if you’re going into the nonprofit world. In that case, figure out which loans to pay off first to save the most in interest and take advantage of each lender’s unique perks.

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How long does it take to pay back medical school debt?

How long it takes to pay back your med school debt depends on your loan terms. Since medical school is typically more expensive than other types of graduate programs, you’ll likely be able to qualify for the longest available loan terms.

With most private lenders and refinancing companies, this is 10 to 25 years. Federal loans can take as long as 30 years to pay off if you consolidate them with a Direct Consolidation Loan.

Is medical school worth the debt?

Whether medical school is worth the debt depends on your personal, financial and career goals. Base salaries can easily top $350,000 for some specialties. Even lower-paying medical careers can top $100,000 — making repayments on a $300,000 debt load slightly more manageable.

Medical school can be rewarding in other ways. If you plan on making a career in public health or serving your country, repayment assistant programs can help you jump on that path rather than taking a job to pay off your loans first.

8 highest-paying medical professions

According to Finder’s analysis of LinkedIn’s Top 20 Highest Paying Jobs of 2017 study, the highest-paying professions in medicine are:

Medical professionMedian base salary in 2017
1. Cardiologist$365,000
2. Radiologist$355,000
3. Anesthesiologist$350,000
4. Surgeon$338,000
5. Medical director$230,000
6. Pathologist$225,000
7. General physician$220,000
8. Hospitalist$220,000

Bottom line

Medical school is expensive, but that $300,000 student debt load might not be as daunting if you go into a high-paying field like cardiology. And if you’re more interested in working with underserved communities, you could be eligible for multiple federal and state forgiveness programs.

Want to learn more about how it all works? Read our guide to student loans.

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