Center for American Progress

Invest in Scholarship and Loan Repayment Programs for New Health Providers
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Invest in Scholarship and Loan Repayment Programs for New Health Providers

Significant new investments in scholarship and loan repayment programs should be an important component of a comprehensive strategy to address health care workforce needs.

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Existing federal scholarship and loan repayment programs—including the National Health Service Corps, Indian Health Service programs, Health Resources and Services Administration’s Primary Care Loan program, and HRSA’s nursing scholarship and loan repayment programs—ease the burden of educational expenses and encourage newly trained providers to practice in underserved areas or in primary care.

Because physicians with loan obligations are immediately available to practice, loan repayment programs appear to be a particularly effective strategy for quickly improving provider supply in underserved areas. Scholarship programs, in contrast, make an up-front investment in trainee providers who must finish their training before beginning practice in an underserved area. In general, the funding and numbers of health professionals participating in these programs have been level or declining over the last several years. Participation in the National Health Service Corps, for example, has fallen from 733 scholarship participants and 2,907 loan repayment participants in 2005 to 669 scholarship participants and 2,273 loan repayment participants in 2008. HRSA’s nursing programs have recently enjoyed an increase in field strength, but their small size—337 scholarship awards and 902 loan repayment contracts—are dwarfed by the magnitude of the current and forecasted nursing shortage.

Significant new investments in these programs—particularly the nursing scholarship and loan repayment initiatives—should be an important component of a comprehensive strategy to address workforce needs. This investment should begin with the fiscal year 2010 appropriation bills.

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