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  • Writer's pictureNathan Zarcaro

NHSC Loan Repayment: Is it Worth it?

Updated: Apr 1, 2023


America's healthcare workers work incredibly long and arduous days in the nation's doctor offices, hospitals, and other healthcare practice sites. Thankfully, they are compensated well for their work and have options to help them face the student loan burden that often accompanies their education.


But for those willing to serve underrepresented populations in rural healthcare settings, larger student loan support is likely to be an option via the NHSC Loan Repayment Program.


This article will cover everything that you need to know about the National Health Service Corp's Loan Repayment Program (NHSC LRP).


A doctor with a stethoscope


What is the NHSC Loan Repayment Program?


The NHSC Loan Repayment Program is a student loan assistance program for qualifying healthcare professionals that agree to practice medicine in federally designated Health Professional Shortage Areas (HPSA).


Under the terms of the NHSC LRP, you'll be expected to serve for at least two years at an NHSC-approved site.


There are actually three different loan repayment assistance programs offered.


  1. NHSC LRP

  2. NHSC Substance Use Disorder (SUD) Workforce LRP

  3. NHSC Rural Community LRP


The NHSC LRP carries student loan forgiveness up to $50,000 for fulfilling an initial two-year service term, though continuation contracts may be granted to those with qualifying loans still outstanding. Those that decide to serve in a half-time capacity are still eligible to receive up to $25,000 in student loan forgiveness.


The NHSC SUD Workforce LRP awards eligible clinicians with up to $75,000 in student loan repayment assistance in exchange for three years of full-time service.


Finally, the Rural Community Loan Repayment Program, designed to help attract providers to fight the nation's opioid addiction, grants awards as high as $100,000 for three years of full-time service, and half of that for part-time service.


Forgiveness under any NHSC program is not taxable.



NHSC Loan Repayment Program eligible disciplines


Eligibility for the LRP is reserved for healthcare providers working in primary care medical, dental care, or behavioral/mental health settings. More specifically, the following types of providers are eligible:


  1. Physicians (Allopathic and Osteopathic) working in Family Medicine, General Internal Medicine, General Pediatrics, Obstetrics/Gynecology, Geriatrics, or Psychiatry

  2. Physician Assistants and Nurse Practitioners working in Adult, Family, Pediatric, Women's Health, Pediatrics, or Mental Health & Psychiatry

  3. Certified Nurse-Midwives

  4. Doctors of Dental Surgery and Doctor of Medicine in Dentistry working in General of Pediatric Dentistry

  5. Dental Hygienists

  6. Health Service Psychologists

  7. Licensed Clinical Social Workers

  8. Marriage and Family Therapists

  9. Licensed Professional Counselors


Qualifying based on your discipline and specialty is only the first part of LRP eligibility. You're also going to need to meet the following eligibility criteria:


  • Be a United States citizen or eligible national

  • Be a fully trained and licensed to practice medicine in a qualifying discipline (listed above) within the state you work in

  • Have outstanding and qualifying student loan debt

  • Provide healthcare services (or have the eligibility to provide) to Medicare, Medicaid, and CHIP (Children's Health Insurance Program) populations


Remember - your employment needs to occur within an HPSA.



HPSA service areas


Oftentimes, Americans confuse HPSAs with RHCs - rural health centers. And while many HPSAs are located in rural areas across the country, there are also plenty of other sites, including those at/in:


  1. Urban areas

  2. Schools or community settings

  3. State or federal jails/prisons


There can, unfortunately, be a shortage of health professionals just about anywhere.



Applying for the NHSC Loan Repayment Program


So you've decided to pursue the National Health Service Corps LRP to help lessen the burden of your outstanding student loans. Good for you! The program is highly competitive, but may be the best way for you to pay down your outstanding student debt as quickly as you can.


Applying for the program requires some time and energy, but it will be well worth it. My sister gained acceptance into the LRP in July 2022, and completed the following steps.



1. Verify your eligibility


Before you go through the process, you're going to want to be sure that you are in fact eligible. And while this post is a good guide to get you started, you're still going to want to reference the organization's own eligibility guidance.


Once this step has been completed, you can proceed to submitting your application.



2. Submit an application


You'll next to need to submit an NHSC LRP application, a process that you can expect to take about three weeks. This part of the process will ask you to submit providing documentation about your loans (loan verification), as well as your qualifying employment. Once you've been accepted into the program, your qualifying employment will be examined every six months.



3. Receive your NHSC award


Once accepted into the program, you'll receive a communication that asks for your direct deposit information. From there, your award will be wired to your account, for use towards your outstanding student loan balance.



Our opinion on NHSC student loan forgiveness


We are huge fans of these plans for a couple of reasons.


First, participants perform really important work, and they are well compensated for it. The NHSC plans offer some of the highest forgiveness amounts of any student loan forgiveness program out there.


Second, we love that there are three (slightly) different programs, meaning that many types of healthcare providers that want to be part of the NHSC mission can do so - and receive loan repayment assistance at the same time.


If you're considering applying for any of these three programs, you'll want to be sure you avoid these common mistakes that we see all too often:


  • Picking the wrong program: If you're not willing or able to commit to a three year service commitment, then you should opt for the NHSC LRP, just to cite one example.


  • Not understanding all of the program requirements: All three of the NHSC loan repayment assistance programs require you to practice in HPSAs, which can occur just about anywhere. But the rural community NHSC program requires you to practice within a qualifying rural area.



Other student loan assistance programs for healthcare workers


There is no shortage of other student loan forgiveness plans out there for healthcare providers. For example, those that don’t qualify for NHSC Loan Repayment may opt for programs such as Public Service Loan Forgiveness, Perkins Loan Cancellation, and other healthcare centric programs including:


  1. Nurse Corps Loan Repayment Program

  2. National Institute of Health LRAP

  3. And more!


You may also consider checking out our piece on healthcare student loan forgiveness.



Should you pursue NHSC Loan Repayment or another program?


While there is no one answer that applies to everyone, generally, the less debt you have, the more it makes sense for you to pursue an NHSC program. This is because they are extremely lucrative given the service commitment expectations.


For example, a nurse practitioner with $50,000 in outstanding student loan debt can find himself/herself debt free in just two years. That same NP would have to make 10 years of payments on PSLF before becoming eligible for total forgiveness, for example.


For those with hundreds of thousands of dollars in outstanding loans, the story is a little less clear. But NHSC may still be a great place to start, since it offers the quickest initial path to getting your outstanding balance down quickly.


It can be tricky to decide, since the NHSC programs are so competitive. Whatever you decide, remember to compare the pros and cons of each approach.



Download our student loan calculator


Unsure if the National Health Service Corps LRPs are right for you? That's okay. We built a student loan calculator designed to help you determine which student loan forgiveness plan or other strategy may be right for you.


Our student loan calculator

Our calculator can help you decide among the following student loan strategies:


  • Standard Repayment

  • Income-Based Repayment

  • Pay as You Earn

  • Revised Pay as You Earn

  • Public Service Loan Forgiveness

  • Private Refinancing

  • Federal Consolidation

  • And more!



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About Nathan Zarcaro

Nathan Zarcaro is the founder of The Student Debt Destroyer and is passionate about personal finance related causes.  A 2018 graduate of Providence College's Liberal Arts Honors Program, Nathan studied Finance, and has worked for industry leaders in both finance and healthcare.  In his free time, Nathan enjoys playing golf and traveling with his wife Brigid.

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