September 27, 2019
Area(s) of Interest: Physician Workforce
California congressional representatives Josh Harder (CA-10), Paul Cook (CA-08) and Karen Bass (CA-37), and Texas representatives Joaquin Castro (TX-20) and Dan Crenshaw (TX-02) have introduced the bipartisan Stopping Doctor Shortages Act, to close a loophole in federal regulations that prevents doctors in California and Texas from qualifying for student loan repayment programs.
“Just about everyone I talk to about health care in the Central Valley tells me the same thing – we just need more doctors – and that’s exactly what my bill would bring to our area,” said Rep. Harder. “This weird quirk in federal regulations puts us at a disadvantage and means new doctors are more likely to leave the state to get tens of thousands of dollars of their loans repaid. If we get this fixed, we’re talking about as many as ten thousand new physicians in California in the next decade alone.”
A federal loan repayment program, created in 2007, was designed to give physicians working for nonprofits the opportunity to get their federal student loans forgiven after making on-time payments for 10 years. California’s bar on the corporate practice of medicine prevents physicians from being directly employed by non-profit organizations, meaning they don’t qualify for the federal loan forgiveness program. When the federal government rolled out the program, they did not account for the unique law in California, meaning physicians have been forced to leave the state or are disincentivized from working in nonprofits in search of forgiveness for immense student loan debt. Texas is the only other state with a similar law restricting student loan forgiveness for doctors.
Rep. Harder’s bill will close the loophole by requiring the Department of Education to allow physicians who conduct full-time work for nonprofits to qualify for the program even if they’re not directly employed by the nonprofit organization.
“The federal Loan Forgiveness Program has been an important and effective way to address physician shortages across the country. An error in the current law excludes many physicians in California and Texas from the program,” said CMA President David H. Aizuss, M.D. “This bipartisan, technical fix will allow the program to be utilized by physicians in California and Texas who were inadvertently excluded from the original program, including those who practice in children’s hospitals and rural hospitals, and could help California retain or attract as many as 10,000 physicians over the next decade to address critical physician shortages in our state.”
The bill is endorsed by the California Medical Association and Texas Medical Association.