Federal student loan forgiveness latest: Application now available
While an appeals court stalled plans to cancel federal student loan debt just days after the government rolled out its application process, doctors of optometry should still be aware that a years-long loan payment freeze is lifting in several weeks.
On Oct. 21, the Eighth Circuit Court of Appeals issued an administrative stay to temporarily block a process for federal student loan debt cancellation. Per the Associated Press, the stay orders the government not to move forward with its debt elimination program while the court considers a motion from six states. Only days earlier, President Joe Biden had announced an official application process for borrowers to apply for debt cancellation.
Prior to the court stay, eligible borrowers seeking federal loan debt cancellation could follow these steps:
- Visit the studentaid.gov site for the debt relief application.
- Input borrower information, including name, social security number, birthdate, phone number and email address. (The application does not require documentation of income or student loans).
- Review the eligibility rules and affirm your eligibility status.
Then, the U.S. Department of Education (DOE) will use existing records to ensure applicants’ eligibility, and some may be required to provide additional documentation to prove income levels. Once the form is submitted, the process is expected to take four to six weeks, reportedly, and applicants’ loan servicers will notify when fully processed.
Borrowers seeking relief were encouraged to apply before mid-November as the Biden administration plans to lift the federal student loan payment moratorium and restart payments on Jan. 1, 2023.
On Aug. 24, the administration announced a decision to forgive $10,000 in federal student loan debt for individuals with incomes below $125,000 a year, or households earning less than $250,000, as well as an additional $10,000 in forgiveness for federal Pell grantees. The cancellation applied to loans held by the DOE and used to attend undergraduate or graduate school. Current students are eligible if their loans were issued before July 1, 2022, and dependent students are eligible based on their parents’ income as opposed to their own.
Prepare now: Federal student loan payments resume Jan. 1
The administration’s August announcement also confirmed that the federal student loan payment freeze, initially brought about by the COVID-19 pandemic in 2020, would be extended one final time with interest rates remaining at 0% until repayments start. The freeze was set to expire Aug. 31.
For the first time in two years, many doctors of optometry will be required to restart their student loan payments on Jan. 1, 2023. To help doctors navigate the federal student loan payment restart, as well as learn more about the Biden administration’s student loan action, AOAExcel and its student loan refinancing partner, Laurel Road, will host an interactive workshop to prepare doctors for the Jan. 1, 2023, restart. Workshop topics will include:
- How doctors of optometry can position their student loans during interest rate uncertainty.
- What the federal student loan payment and interest pause means for doctors of optometry.
- An explanation of the new federal student loan forgiveness as it pertains to doctors of optometry.
- What is student loan refinancing—are you eligible? Can you save by refinancing, and will it affect your credit score?
Register now for the AOA-member exclusive, “Navigating the Student Loan Payment Re-Start with Confidence” workshop, 8 p.m. ET, Wednesday, Nov. 2. Read more about what you need to know about student loan debt cancellation.
But larger questions still remain over how legal challenges might mire the forgiveness process or even reverse the decision altogether. While the debt relief plan is seen as long-awaited fulfillment of a campaign promise, federal student loans had been the center of attention dating back to the height of the COVID-19 pandemic—and even before—when the AOA and AOSA repeatedly advocated for a federal student loan payment moratorium under both the Biden and Trump administrations, as well as years of advocacy to reinstate optometry in the National Health Service Corps (NHSC).
Leveraging NHSC in debt relief, increased eye care access
Given how the average optometry student’s loan debt at graduation is close to $200,000, the AOA and American Optometric Student Association (AOSA) know debt relief is a concern for the profession. In collaboration with the National Optometric Association (NOA), the National Optometric Student Association (NOSA), and the Association of Schools and Colleges of Optometry (ASCO), the AOA and AOSA continue to advocate for a win-win solution that not only addresses optometry students’ loan debt but also delivers critical eye care to underserved communities while taking a step toward bolstering access and equity.
In a May 27 letter to U.S. Ambassador Susan Rice, assistant to President Biden for domestic policy, advocates once again called for the Department of Education to coordinate with the Health Resources & Services Administration (HRSA) to remedy optometry’s exclusion from the NHSC loan forgiveness program. As HRSA’s flagship health workforce program, NHSC offers doctors and clinicians the opportunity to work and have student loans repaid in exchange for providing two years of service in urban, rural or tribal communities with limited access to care.
“The NHSC is a powerful recruiting tool for health centers and have been shown to be successful in both recruiting and retaining providers to care for patients in underserved communities,” reads the letter, signed by the presidents of the AOA, AOSA, NOA, NOSA and ASCO. “If we are to build a more inclusive and accessible health care system that employs individuals with a wide range of socioeconomic and racial backgrounds, action must be taken to reduce student debt and increase loan forgiveness opportunities through the NHSC.”
Currently, optometry is not eligible for the NHSC loan forgiveness program despite originally being included at its inception. This omission is glaring, especially considering that optometry delivers up to 80% of all primary vision and eye health care through Medicaid, as well as medical eye care to over 6 million Medicare beneficiaries annually.
The letter continues by advocating against the exclusion of broad categories of professionals in various debt relief programs and proposals, as other factors, such as current income, are better indicators of those who would benefit most.
Reinstating optometry into the NHSC program has been among advocates’ top priorities for years with calls to initiate an immediate rulemaking process, clarifying 42 U.S. Code § 2541—1 to state the profession’s eligibility. In 2021, the same group of optometric stakeholders wrote to the Department of Education, reiterating policy briefs and statements from the National Rural Health Association (NRHA) and American Public Health Association that demonstrate optometry’s utility in rural and underserved communities. That year, the group also wrote to Ambassador Rice, joining alongside the NRHA and Association of Clinicians for the Underserved to encourage optometry’s inclusion in the NHSC.
But even prior to recent years, the NHSC issue has been one that doctors and optometry students champion to their members of Congress during AOA on Capitol Hill, the AOA’s largest annual federal advocacy event. The fly-in sees hundreds of advocates directly appeal for Congressional intervention to reinstate optometry.
Support the AOA’s advocacy
Help the AOA continue its advocacy on behalf of optometry students and new graduates by getting involved and helping advocates build momentum. Here’s how:
- Visit the AOA Action Center. Learn more about the NHSC issue and other federal priorities for optometry. Or text “NHSC” to 855.465.5124 to encourage optometry’s reinstatement in the NHSC.
- Become an AOA-PAC investor. This is one of the easiest, most effective ways to help make an impact in the AOA’s ongoing advocacy efforts. Use your eight-digit, AOA membership ID number and log in from your computer to make an immediate investment* to support the profession.
*Contributions to the AOA-PAC are for political purposes and are not tax deductible. Only AOA members and other eligible persons may contribute. Contributions will be screened and those from non-eligible persons will be returned. You have the right to refuse to contribute without fear of reprisal. You will not be advantaged or disadvantaged because of how much you give or because you do not give.
Student Loan Refinancing
AOA members in good standing are eligible for a 0.25% rate discount when refinancing with AOAExcel’s endorsed business partner, Laurel Road.
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