California to Pay Off $58.6 Million in Student Loans of Physicians
The state of California will soon pay off the student loan debts of hundreds of its physicians and dentists throughout the state in return for those individuals treating low-income patients.
The California Department of Health Care Services (DHCS) allocated $58.6 million for its CalHealthCares loan repayment program to erase the student loan debts of 247 physicians. Awards for dental applicants will be announced in mid-July.
Under the program, the state will pay up to $300,000 in debt relief in exchange for physicians meeting certain criteria, which includes maintaining a patient caseload of 30 percent or more of Medi-Cal beneficiaries.
Medi-Cal is California’s public health insurance program, financed equally by the state and the federal government, which provides needed health care services to low-income individuals including families with children, seniors, persons with disabilities, foster care and pregnant women.
“By removing the burden of student loan debt, this program will encourage more providers to make different choices when entering the health care market and be able to provide care for the Medi-Cal population,” Jennifer Kent, DHCS director, said.
A recent study conducted by Guardian financial wellness found that seven out of 10 working adults with student debt identify their finances as their major source of stress, and that most of them are pessimistic about making good progress when it comes to paying off their debts.
The awardee doctors represent 40 specialty areas of medicine and will serve low-income populations in nearly 39 counties throughout California.
Nearly 1,300 health care providers applied under the program, which was established in 2018 with an initial funding amount of $220 million. An additional $120 million was allocated in the program’s revised 2019-20 budget.
Applicants must also have graduated from medical school within the past five years, and must be an actively enrolled Medi-Cal provider without suspensions, disbarments or revocations in order to qualify for the debt relief.