Loan forgiveness program, under threat, gets AMA support

Brendan Murphy
Staff Writer
AMA Wire
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The AMA adopted new policy this week supporting expansion of the Public Service Loan Forgiveness program (PSLF) to residents at for-profit institutions, while affirming its stance against putting a cap on the loan forgiveness program.

“As trainees often pursue the best education available irrespective of salary and, certainly, of the profit status of the institution, the profit status of graduate medical education training institutions should not be a qualification for PSLF eligibility,” says an AMA Council on Medical Education report whose recommendations were adopted after amendments by the AMA House of Delegates (HOD) at the 2017 AMA Annual Meeting in Chicago.

Easing student loan burden has long been an AMA priority. The HOD reaffirmed AMA policy to oppose “a cap on federal loan forgiveness programs.”

Future of loan forgiveness

Enacted in 2007, the PSLF program forgives loan balances after 120 payments—typically, 10 years of payments. Generally, most individuals are making payments through an income-based repayment plan and will have a balance even after the PSLF kicks in.

Participation in PSLF among medical students grew by 20 percent every year from 2010 to 2016, according to a 2016 study in the Journal of General Internal Medicine. The program’s popularity, however, has earned criticism from those who point to the cost burden taken on by the federal government in light of the high educational debt level accrued by some high-earning professionals following their graduate programs. Among the critics: The current administration. President Donald Trump’s proposed 2018 budget, which has been met with widespread skepticism on Capitol Hill, calls for eliminating the PSLF program.

Were the program to be changed or eliminated, the HOD action aims to protect those who are currently enrolled, with the AMA strongly advocating that “the terms of the PSLF

that existed at the time of the agreement remain unchanged for any program participant.”

Give residents PSLF information

Though the report stated that physicians training at institutions that are both for-profit and nonprofits should be granted eligibility to PSLF, delegates also adopted new policy calling for the Accreditation Council for Graduate Medical Education to require that programs inform applicants of the PSLF qualifying status of the program.

The council’s report indicates that “during the match process, medical students rank residency programs based on the quality of training they perceive they are likely to receive, among other variables. They may not be aware of or have access to information about the for-profit status of the entity that will pay their salary.”

The AMA also will encourage medical school financial advisers to promote “service-based loan repayment options and other federal and military programs” when counseling medical students.

More GME funding in underserved areas

In other action that could affect the availability of physicians in underserved areas, delegates directed the AMA to advocate to the Centers for Medicare and Medicaid Services (CMS) for flexibility beyond the current maximum of five years on the current graduate medical education (GME) cap-setting deadline for new residency programs. This new policy will allow institutions in medically underserved areas time to create new residency programs to care for patients.

“The AMA remains committed to expanding GME funding to ensure we train enough physicians to meet the nation’s changing health care needs,” said AMA Board of Trustees Member and resident physician Omar Z. Maniya, MD. “The current five-year deadline for developing new residency programs in underserved areas before a cap is placed on the amount of Medicare funding they can receive for these programs is not effective. We will urge CMS to give institutions the time they need to identify qualified, willing teaching partners to create residency programs that are able to meet the needs of patients in underserved areas.”

Read more news coverage from the 2017 AMA Annual Meeting.

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Dec 11, 2017
To meet the 2017 reporting deadline, physicians must report on at least one patient and one measure by Dec. 31 and submit to Medicare no later than Feb. 28 to avoid a payment penalty in 2019.