Recently, the U.S. Department of Education released draft regulations to reform the national Public Service Loan Forgiveness (PSLF) program. Despite the department’s stated interest in fixing its existing PSLF regulation—which inadvertently excludes many California and Texas physicians from participating—the draft regulatory language inexplicably still fails to fix the problem.

The California Medical Association (CMA) urgently needs all physicians, residents and medical students to send a letter to the Dept. of Education before August 12, 2022, urging them to allow qualified California and Texas physicians who provide care in private non-profit hospitals/clinics to receive federal student loan forgiveness.

The Dept. of Education is accepting comments on its draft regulations through Friday, August 12, and we need as many of you as possible to submit a letter to show the urgency of this matter. CMA has prepared a sample letter and instructions for sending the letter via the regulatory comment submission portal. It only takes 3 minutes.

It is critically important that the Dept. of Education resolve the problem once and for all to ensure that physicians in all 50 states can equally participate in this important program to encourage students to pursue careers in medicine and to help our neediest, most vulnerable patients in underserved communities.  If the regulations are not fixed to allow physicians in California and Texas to participate, physicians will choose to practice in other states where they can receive loan forgiveness, accelerating our worsening physician shortages and harming our ability to care for the patients who need us most.

Background

The PSLF program was intended to provide loan forgiveness to individuals who commit to community service for 10 years by working full time (30 hours/week) in non-profit organizations, such as non-profit hospitals, and improving access to health care. Unfortunately, the program’s implementing regulations were narrowed to require physicians to be “directly employed.” Many physicians in our nation’s two largest states consequently were inadvertently excluded because, while they may be members of their hospital medical staffs working full time in private nonprofit hospitals/clinics and able to meet all other PSLF eligibility requirements, state laws in California and Texas prohibit these private, non-profit hospitals from employing physicians. But for this legal prohibition on employment these California and Texas physicians could be eligible for loan forgiveness just as physicians from all other 48 states who similarly work in private non-profit hospitals are eligible to participate. 

The language in the new draft regulations attempts to solve the problem of requiring “direct employment” in California and Texas by instead requiring that physicians “contract with” private non-profit hospitals “to provide payroll or similar services” to receive loan forgiveness. While well-intended, the proposed regulation does not solve the problem and still excludes California and Texas physicians because they do not contract with hospitals to provide payroll services. Moreover, many physicians in these states do not practice in nonprofit hospitals with a contract and would still be ineligible regardless of whether the contract was for payroll services.

CMA, working jointly with the California Hospital Association, the Texas Medical Association, and the Texas Hospital Association, is urging the Department to accept an alternative for physicians practicing in states that prohibit direct employment. The plan would allow PSLF eligibility for California and Texas physicians through additional written certification from an authorized official of the public service organization (hospital, clinic) certifying that the physician works full time (30 hours/week) in the private non-profit facility, is authorized through the clinical privileges credentialling process, but is not able to be employed by the facility because of state law. This is an additional standard for California and Texas physicians who are prohibited by state law from being directly hired and paid by the facility.

Take Action by August 12

Please join CMA in sending a strong message to the US Department of Education that in order to reverse physician shortages and protect access to care, qualified California and Texas physicians must be allowed to participate in the federal loan forgiveness program. Click here to download our sample letter. Instructions for sending the letter are below:

• Update the CMA sample letter by specifying medical student or physician on the first line where highlighted in yellow and add your name at the end. Please feel free to add personal comments as well.
• Click here to access the Dept. of Education regulatory comment submission portal.
• Click on “comment.”
• Copy and paste the CMA sample letter with your name into the comment box. 
• Scroll down and fill in your email address.
• Click on “individual” and fill in your personal information.
• Click the “I’m Not a Robot” box.
• And be sure to hit “SUBMIT COMMENT” at the end.

Thank you in advance for helping us send a strong message to the Dept. of Education to ensure that physicians in all 50 states can equally participate in this important program.