How Will the New ‘One Big Beautiful Bill Act’ Change Medical Student and NP Loans

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The House of Representatives recently passed the One Big Beautiful Bill Act (OBBBA), a sweeping piece of legislation that, among other things, proposes major changes to federal student loan programs—including those affecting medical students. While the bill still awaits Senate consideration, its current form has already sparked strong reactions from both supporters and critics in the healthcare and education communities.

Proposed Changes to Medical Student Loans

• Elimination of Grad PLUS Loans: The bill proposes to end the Grad PLUS loan program for graduate students, including those in medical schools. This program currently allows students to borrow up to the full cost of tuition and living expenses. Under the bill, new borrowers would be barred from accessing Grad PLUS starting in the 2026-2027 academic year, though existing borrowers could continue through the 2029-2030 school year.
• Caps on Federal Loans: Federal loans for graduate and professional students would be capped at $150,000. This is a significant reduction, as many medical programs cost more than this limit, especially when factoring in living expenses.
• Restructuring Repayment Plans: The bill would eliminate most current repayment options, including the Biden-era SAVE plan and other income-driven repayment (IDR) plans. Borrowers would be left with two choices: a Standard Repayment Plan with fixed monthly payments, or a new Repayment Assistance Plan (RAP) based on income. The RAP would require payments ranging from $120 per year for those earning under $10,000 to 10% of gross income for higher earners, with forgiveness after 30 years—longer than the current 20- or 25-year forgiveness timelines.
• Public Service Loan Forgiveness (PSLF): The bill introduces new restrictions on PSLF, which is a critical program for many healthcare professionals working in underserved areas. Critics warn that these changes could make it harder for nurses and doctors to qualify for loan forgiveness after working in public service roles.
• Deferment and Forbearance Limits: For loans taken out after July 2025, the ability to defer payments due to unemployment or financial hardship would be revoked, and forbearance would be capped at nine months within a 24-month period.

Support and Opposition to the OBBBA

• Supporters of the OBBBA:
  • The House Education and Workforce Committee and conservative policy groups argue that these reforms are necessary to reduce federal spending and bring accountability to higher education. The Wall Street Journal Editorial Board stated that the goal is to “hold colleges accountable for student outcomes and curb the open-ended loan buffet.”
  • Lindsey Burke, Director at the Heritage Foundation, praised the repeal of PSLF and PLUS Loans, saying, "Repealing the Public Service Loan Forgiveness program and ending PLUS Loans reduce unnecessary federal involvement in higher education that only encourage higher tuition and more student debt."
• Opponents of the OBBBA:
  • The Student Borrower Protection Center (SBPC) warns that the bill would disqualify borrowers currently receiving Pell Grants, push more borrowers towards private loans due to new federal restrictions, and raise monthly payments for individuals repaying their loans.
  • The American Academy of Family Physicians (AAFP) Board Chair Steve Furr, MD, FAAFP, expressed concerns about the impact on future doctors and nurses: "Educational debt directly influences medical student choices about specialty and location of practice. ... Preserving and strengthening avenues for loan repayment such as PSLF could give family physicians who want to practice in rural areas greater financial freedom to start businesses, employ others, and provide invaluable health care and economic activity in their communities.”
  • Teaching hospitals and medical educators have also raised concerns, arguing that the $150,000 cap and elimination of Grad PLUS loans could worsen healthcare worker shortages by making it financially impossible for many students to attend medical or nursing school.

What This Means for Medical Students

If enacted, these changes could:

• Make it harder for medical students to finance their education, especially at higher-cost institutions.
• Force more students to turn to private loans, which typically have higher interest rates and fewer protections than federal loans.
• Increase the financial burden on new graduates, as repayment options become more limited and monthly payments could rise.
• Potentially reduce the number of new medical students entering the workforce, particularly in underserved areas, due to increased debt and fewer forgiveness options.

The bill's future remains uncertain as it heads to the Senate, where amendments are possible. Medical professionals should monitor these developments closely, as the outcome could have a lasting impact on their financial futures and the broader healthcare workforce.

Nurse.org will continue updating this article as the OBBBA moves forward to the Senate.

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