State makes cut to loan repayment program for health care workers

Vermont officials cut state match money for a recruitment program for doctors and nurses as part of reductions to the fiscal year 2015 General Fund budget that were finalized last week.

Vermont was slated to receive $250,000 per year for four years for an educational loan repayment program to attract and retain doctors and nurses in underserved areas. The state match money was cut as part of a $31 million reduction in state spending.

The cuts came just weeks after the state received federal funding for the program. Officials say the impact of the reduction in state funding and federal matching funds will hit the recruitment program in fiscal year 2017.

Tracy Dolan, interim commissioner of the Vermont Department of Health which oversees the program, said the cuts won’t result in an overall reduction to the program in fiscal years 2015 and 2016. For those fiscal years, the federal money will result in a net gain of $330,000 or $1.3 million total.

The Health Center in Plainfield is a federally qualified health center. Photo by Morgan True/VTDigger

The Health Center in Plainfield is a federally qualified health center. Photo by Morgan True/VTDigger

The state will forgo $500,000 in federal money for loan repayments in FY 2017 and 2018. Supporters and opponents of single-payer argue whether the program itself will be a recruitment tool or drive away health care professionals.

Dolan said she’s “hopeful” the current administration — or a future administration — will restore the state match and secure the additional federal money.

The educational loan repayment program creates “financial incentives for providers to serve in underserved areas by making meaningful contributions to pay down their educational debt,” Dolan said in an email statement.

It also helps Vermont compete with its neighbors, she said. All but three states have some form of loan repayment program for doctors and nurses.

People are eligible for multiple years of financial assistance to further improve retention. The hope is that the providers will establish themselves in communities and remain after their eligibility for the program ends, Dolan said.

The program helps nearly 25 practitioners each year with amounts of up to $20,000. Physicians, physician assistants, nurse practitioners and dentists who work in underserved areas can receive the funding for up to six years.

Doctors graduate from medical school with an average of $170,000 in student debt, and 86 percent graduate with some amount of debt, according to figures from 2013 compiled by the Association of American Medical Colleges.

The report says that 38 percent will seek some form of loan forgiveness or repayment program.

The University of Vermont College of Medicine and the Vermont Area Health Education Centers, a nonprofit that works on access to care issues, manage the applications and awards.

There are towns in every county in the state that are considered underserved. For more detail on eligibility and the application process click here.

Morgan True

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