New limits on school loans could narrow physician and nurse pipeline, educators warn

"A little-noticed provision in the sweeping "One Big Beautiful" legislation enacted by the GOP over the summer sharply limits the amount of federal student loans that students earning professional degrees — including medical school — can borrow. It also imposes even stricter borrowing caps for other health fields including nursing and public health. The Education Department does not consider graduate education in those fields "professional" education, though officials described that as a technical and regulatory decision, rather than a value judgment."

"The loan changes will hit next July when an open-ended federal loan program known as Grad PLUS will stop making new loans. From that point on, med students won't be able to borrow more than $50,000 a year — or more than $200,000 over the four years. Many private med schools already cost north of $300,000, including living expenses. "That will automatically give a lot of people some pause to think about where they're accepted and what their finances are,""

"On top of those new restrictions, a federal regulation posted October 30 — already facing a court challenge — adds new conditions to the Public Service Loan Forgiveness program, which enables health workers who work in high needs areas and make payments for 10 years to erase debt. The new Trump administration policy said loan forgiveness won't be an option for people working for an entity engaging in, among other things, illegal activities involving immigration, gender-affirming care, or "terrorism" aimed at "obstructing or influencing" federal policy."

Federal legislation enacted over the summer imposes sharp limits on federal student loan borrowing for professional degrees, including medical school, and stricter caps for nursing and public health. The Education Department classifies graduate education in those health fields as not "professional" for regulatory purposes. The open-ended Grad PLUS loan program will stop making new loans next July, after which medical students face caps of $50,000 per year and $200,000 total over four years. Many private medical programs cost over $300,000 including living expenses, threatening affordability and socioeconomic diversity. A new federal regulation also tightens Public Service Loan Forgiveness eligibility by excluding employees of entities involved in specified illegal activities.

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