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Pa.’s nursing loan forgiveness program’s popularity outstrips available funding

Pa.’s nursing loan forgiveness program’s popularity outstrips available funding
Written by Publishing Team

The One-Time Student Loan Forgiveness Program for Licensed Nurses in Pennsylvania has attracted more than 4,800 applications to date with several thousand more expressing interest in applying and over a month until the deadline.

The strong response to the opportunity to receive a share of the $5 million in debt relief provided through the Commonwealth Student Relief for Nurses program called for state policymakers to increase the amount of funding available to access more nurses.

The program, administered by the Board of Directors of the Pennsylvania Agency to Assist Higher Education Qualified Nurses, provides up to $7,500 in debt reduction. Applications are accepted until March 1.

Funding for the program, directed by Governor Tom Wolf, comes from the state’s share of US Federal bailout dollars.

But assuming every eligible nurse qualifies for the maximum loan forgiveness, Elizabeth McCloud, vice president for state grants and special programs at PHEAA, told the PHEAA Board of Directors Thursday that means only 666 nurses will receive relief.

“We’re not even close to that,” said Representative Mike Beaver, R-Pike County, who chairs the PHEAA board.

He urged the House to sound the alarm to Wolff’s budget secretary and the chairs of the House and Senate appropriations committees about the response.

“If we can find more COVID dollars, that would be great,” Beaver said. “Because right now, there just isn’t enough.”

Senator Maria Collette, D-Montgomery County, who brought the idea for this program to the governor, said, “I hope the number of interested applicants will send a loud message to our legislature that [Student Loan Relief for Nurses] The program should be expanded to benefit as many hard-working Pennsylvania nurses as possible.”

Wolff’s spokeswoman said Wolff supports lawmakers’ call for increased funding for the program.

“We are pleased that this program has received such a strong response from our nurses, who play a critical role in our health system every day and especially during the pandemic,” said Wolff’s spokeswoman, Beth Reminter. “Because of their tireless work on the front lines during the pandemic, not only did we launch the Student Loan Forgiveness Program, but we also took the extra step of not taxing our Student Loan Forgiveness Program and Public Service Loan Forgiveness Program.”

Rementer was referring to Wolf’s December announcement of a tax policy change that would free those receiving debt forgiveness through this federal Public Service Loan Forgiveness Program from having to pay state taxes on canceled debt. The federal government does not count canceled debts as taxable income, either.

The purpose of creating this loan forgiveness program is to provide loan forgiveness to nurses in the hope that it will help retain nurses to ensure that Pennsylvania has the nursing workforce it needs to continue caring for COVID-19 patients.

Nursing shortages have been reported across the Commonwealth and were recently the focus of a House Republican Policy Committee hearing in Hershey.

At that hearing, Pennsylvania health officials said they had more than 400 nurse positions vacant across their health system. A representative of the Allegheny Health Network said it has 1,100 open positions for registered nurses.

Since November when PHEAA worked out the details of the loan forgiveness program, nurses have been allowed to sign up for updates on the upcoming program. By the end of December, McCloud said more than 8,100 nurses had entered their information for the mailing list.

The program application was published on the PHEAA website on December 30. Within one week, more than 2,000 applications were received.

“It is clear that the demand for this program will far exceed the $5 million available in funding,” she told the PHEAA board.

The program is a limited number of Registered Nurses, Licensed Practical Nurses, Certified Registered Registered Nurses, Clinical Nursing Professionals, and Certified Nurse Midwives who are registered as nurses who began working before December 31, 2021, at a Pennsylvania facility that provides nursing care to patients directly.

Selected nurses will receive a waiver of up to $2,500 per year for each year worked, beginning in 2020, and for up to three years. The types of loans eligible for exemption through this program are Federal Student Loans, Private or Business Student Loans, Graduate PLUS Loans and Consolidated Loans provided that only education loans are consolidated.

McCloud expects the selection process to be complete by mid-April and the first round of payments to go out to student loan servants in July.

Since demand far outstrips funding, PHEAA has chosen a selection method that ensures that each of the state’s nine geographic regions receive a percentage of funding equal to the percentage of eligible applicants from each region.

Eligible applicants will then be assigned a random number in each region and awards will be handed out in numerical order until funding runs out, McCloud said.

The popularity of the loan forgiveness program has captured the attention of the House Republican Appropriations Committee and the Senate.

They acknowledge the employment issues faced by many health care providers across the state, said House GOP Appropriations Committee spokesman Neil Leicher.

“We are actively reviewing this program and other proposals to provide relief to frontline workers,” Lesher said.

“We expect it to be something that will be discussed as part of the budget this year,” said Pat Brown, chair of the Senate Republican Appropriations Committee, of R. Lehigh County. Given the current pressure on the nursing supplement throughout the Pennsylvania acute care hospital system and the need to provide solutions to achieve Stabilizing on it, I think we’ll take a big call to expand the capacity of the Nurses Loan Forgiveness Program during the current budget cycle.”

* This story has been updated to include commentary from Senator Pat Brown.

Jean Murphy can be reached at jmurphy@pennlive.com. Follow her on Twitter @JanMurphy.

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