Flux in Loan Repayment Programs for Healthcare Professionals With States’ Budget Cuts and National Health Service Corps Budget Increases

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Overview

Repaying education loans is the most popular incentive now used to attract early-career healthcare practitioners into rural and other shortage areas. The federal National Health Service Corps Loan Repayment Program (NHSC LRP), by far the largest loan repayment program for health professionals, recently doubled in size with increased funding from the American Recovery and Reinvestment Act of 2009 and the Affordable Care Act of 2010. In addition to the federally-funded NHSC program, many states have developed and funded their own programs with state or foundation dollars (hereafter “state-only programs”), and still other programs are funded jointly with NHSC and state dollars (“joint state-NHSC programs”). States use both state-only and joint state-NHSC programs to complement the NHSC LRP, but in the face of challenging state budgets and the increased size of the NHSC LRP, both types of state programs are facing a changing environment. In this project we gathered data to learn how states’ loan repayment programs are weathering the current economic conditions and competition with the expanding NHSC LRP. Through Internet searches and verifying calls to programs, we identified all loan repayment programs in all states that support any type of health practitioner (other than the somewhat different group of programs intended only for nurses). This brief also presents survey results from directors of 96 of the 98 identified state programs addressing questions on year-by-year changes in the size and composition of their workforce and budget changes.

Key findings

  • Funded state-only loan repayment programs have more than doubled from 29 such programs in1996 1 to 63 in 2010, while the number of joint state-NHSC programs has remained relatively unchanged at 28.
  • There were 2,057 clinicians participating in 59 of the 63 (94%) state-only loan repayment programs that reported data for 2010, which is more than three times the 605 participants in state-only loan repayment programs as of 1996. There were 817 participants in the 25 of 28 joint state-NHSC programs that reported data for 2010. For comparison, there were approximately 7,000 clinicians serving in the NHSC LRP in 2010.
  • From 2007 to 2010, states’ loan repayment programs for health professionals continued to increase in numbers (from 81 to 91) and cumulative workforce size.

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