In a sweeping overhaul of the federal student loan system, House Republicans have advanced legislation that would place major new restrictions on student borrowing and Public Service Loan Forgiveness (PSLF) — changes that would directly and disproportionately harm future physicians.

Two provisions in the legislation stand out for their potential to severely restrict access to medical education and deter students from entering the profession. First, for loans taken out after July 1, 2026, hours worked by medical residents at nonprofit hospitals will no longer count toward the PSLF program. Second, federal student loans will be capped at $50,000 for undergraduate education, $100,000 for graduate education — including medical school — and $150,000 for “professional programs.”

These changes come as the nation continues to grapple with a growing physician shortage and widening gaps in patient access to care. The California Medical Association (CMA) is deeply alarmed by the legislation and is urging Congress to reconsider its approach.

“CMA is outraged that House Education and Labor Committee Republicans have adopted short-sighted legislation that would effectively block aspiring physicians from pursuing medical education,” said CMA President Shannon Udovic-Constant, M.D. “At a time when our country urgently needs more doctors — especially in underserved areas — this bill would create new financial and logistical barriers that disproportionately harm low-income students.”

According to the Education Data Initiative, 73% of medical students graduate with substantial education-related debt, with the average being approximately $265,000. Capping federal loans at $150,000 would force many students to seek costly private loans or abandon their dreams of becoming physicians altogether. For those from disadvantaged backgrounds, the impact could be devastating.

The bill would also introduce an additional barrier: borrowing limits would be tied to the median national cost of attendance for each program of study. This means that if a student enrolls in a medical school with tuition above the national median, their federal loans may not be sufficient to cover the full cost — regardless of their financial need. Such a policy fails to account for regional differences, institutional missions, and the reality that many top-performing medical schools charge above-average tuition to fund advanced training and clinical education.

Equally concerning is the bill’s elimination of PSLF eligibility for residency work. The PSLF program forgives the remaining balance on federal student loans for borrowers who work full-time in qualifying nonprofit institutions or government jobs and make 120 qualifying monthly payments — often over 10 years. Currently, physicians working in nonprofit settings can count their residency work toward the program’s 10-year requirement — a critical lifeline for doctors working in low-income or rural communities. Under the new proposal, medical residency work hours would no longer count.

“Physicians in residency often work grueling schedules — 80 hours a week or more — in nonprofit hospitals, treating some of the most vulnerable patients in our society,” said Dr. Udovic-Constant. “To say that this work no longer qualifies as public service is both insulting and harmful. These changes would strip away one of the few supports available to young doctors carrying enormous debt and making modest salaries.”

The broader bill also includes changes to income-driven repayment plans, Pell Grant eligibility and institutional accountability. The legislation eliminates many of the current loan programs and establishes two new programs.  For more information, see the bill summary.

CMA will fight to eliminate these harmful provisions and will continue advocating for student loan policies that support, not stifle, the path to medical practice — and protect patients’ access to care across California.