AMA Advocates For Provisions To Help Med Students And Residents In Higher Ed Reauthorization Bill
"Most medical students enter the workforce with substantial debt, an average of $140,000 when entering residency" said Chris DeRienzo, AMA Board Member and fourth year medical student at Duke University. "This high debt burden can and does play a role in students' ultimate career choices, potentially deterring them from primary care specialties or practicing in underserved areas."
Among the provisions the AMA advocated for is a federal loan forgiveness program for physicians who serve in areas of need. The bill allows eligible medical specialists with five or more years of graduate medical education to qualify for up to $2,000 of forgiveness annually and up to $10,000 over five years of service.
Other provisions in the bill the AMA advocated for also include:
- Disclosure requirements for private lenders that will improve private student loan transparency,
- Disclosure requirements for certain federal lenders that will make sure applicants are provided notice about terms of consolidation, and
- A Government Accountability Office (GAO) study that will analyze the impact of debt on medical school graduates.
"The AMA is committed to easing the significant financial burdens faced by medical students and residents during their graduate medical education years," said Mr. DeRienzo. "The higher ed reauthorization bill is a positive step, providing incentives that will help encourage physicians to work in underserved areas where patients desperately need them and increase loan transparency that will benefit med students and residents during the cumbersome financial planning process."
The College Opportunity and Affordability Act of 2007, H.R. 4137, amends the Higher Education Act of 1965 (HEA) and reauthorizes it for another five years. The Senate passed its version of the bill on July 26, 2007. The House and Senate will hold a conference to resolve differences between the bills before sending to the president. The HEA expires on March 31, 2008.
In addition to its work on the higher education reauthorization bill, the AMA continues to work with the Department of Education and Congress to permanently reinstate and expand the medical student loan deferment eligibility during residency. The program, known as the "20/220 pathway," allows medical residents to defer payment on their loans for up to three years during their residency training based on economic hardship. The eligibility for medical residents was eliminated in October as part of the College Cost Reduction and Access Act. The AMA worked with the Department of Education to get the program temporarily reinstated during the Department's negotiated rule-making process, which is not expected to be completed until the fall of 2008.
Negotiations are ongoing for permanent reinstatement of the "20/220 pathway." "We are committed to working with Congress and the Department of Education on a long term solution for continued loan deferment eligibility for medical residents," said Mr. DeRienzo.
American Medical Association
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