If you are studying nursing or another healthcare field, you are walking into one of the strongest job markets in the country. The Bureau of Labor Statistics projects that the U.S. will need more than 177,000 additional registered nurses each year through 2032, and shortages in primary care, mental health, and rural medicine are even more acute. That demand has created something unusual in the student loan world: federal and state programs that will pay off a significant chunk of your loans in exchange for working in underserved communities after graduation.
These are not vague promises. The Nurse Corps Loan Repayment Program, the National Health Service Corps, and dozens of state-level programs offer real dollars — sometimes covering 60 to 85 percent of your outstanding balance. But each program has its own eligibility rules, service commitments, and application timelines. Understanding these programs before you graduate puts you in a much stronger position to manage your debt. This guide walks you through the major options, what they actually pay, and how to qualify.
The Nurse Corps Loan Repayment Program
How It Works
The Nurse Corps Loan Repayment Program (NCLRP) is run by the Health Resources and Services Administration, a division of the U.S. Department of Health and Human Services. It targets registered nurses (RNs), advanced practice registered nurses (APRNs), and nurse faculty — the people who teach the next generation of nurses. In exchange for a two-year service commitment at a Critical Shortage Facility or an eligible nursing school, the program pays up to 60 percent of your qualifying student loan balance. If you extend for a third year, the program covers an additional 25 percent, bringing the total potential repayment to 85 percent of your outstanding loans.
Who Qualifies
To be eligible for the 2025-26 cycle, you must be a U.S. citizen or national, hold an active and unencumbered nursing license, and either be currently employed at or have an accepted offer from an eligible facility. Eligible facilities include nonprofit hospitals, community health centers, rural clinics, skilled nursing facilities, and accredited nursing schools that are located in areas designated as having a nursing shortage by HRSA. Your loans must be from government or commercial sources used to pay for your nursing education — this includes federal Direct Loans, Stafford Loans, and private education loans.
What the Money Looks Like
For a nurse who graduates with the national average of roughly $40,000 in student loan debt, the Nurse Corps program could eliminate $24,000 over two years and up to $34,000 over three years. Payments go directly to your lender, and the funds are considered taxable income by the IRS, so you will want to plan for a higher tax bill in the years you receive payments. The application typically opens in February or March each year, and the program is competitive — HRSA received over 4,500 applications in recent cycles for approximately 800 to 1,200 awards.
Nurse Faculty Track
If you plan to teach nursing after earning a graduate degree, the nurse faculty track is especially valuable. Nursing schools across the country turned away over 65,000 qualified applicants in 2023 because they did not have enough faculty. The federal government is actively trying to fix this by offering the same 60-to-85-percent loan repayment deal to nurses who commit to teaching full-time at accredited nursing programs.
The National Health Service Corps
How It Works
The National Health Service Corps (NHSC) covers a wide range of healthcare professionals, including nurse practitioners, certified nurse-midwives, psychiatric nurse specialists, physician assistants, physicians, dentists, and behavioral health providers. The NHSC Loan Repayment Program offers up to $50,000 for a two-year full-time service commitment at an approved site in a Health Professional Shortage Area (HPSA). Half-time service earns up to $25,000 for two years. You can apply for additional commitments, and many participants receive well over $100,000 in total loan repayment over their careers.
The Substance Use Disorder Workforce Track
NHSC also runs a Substance Use Disorder (SUD) Workforce Loan Repayment Program to address the national addiction and mental health crisis. This track offers up to $75,000 for a three-year, full-time commitment at an approved SUD treatment facility. If you are studying to become a psychiatric nurse practitioner or another behavioral health provider, this track offers some of the largest federal loan repayment awards available anywhere.
Eligible Sites and How to Find Them
NHSC-approved sites are searchable through the HRSA Health Workforce Connector. These include federally qualified health centers, Indian Health Service facilities, rural health clinics, prison medical facilities, and community behavioral health centers. There are more than 20,000 approved sites across the country. When you are deciding where to work after graduation, checking whether a facility has NHSC approval can be worth tens of thousands of dollars.
Application Timeline
The NHSC application typically opens in the spring. For the 2025 cycle, the window ran from mid-March through mid-April. Awards are scored based on the HPSA score of your practice site (higher scores indicate greater need), your discipline, and your start date. Being willing to work in a high-need rural or urban location significantly improves your chances.
State-Level Healthcare Loan Forgiveness Programs
Why State Programs Matter
Federal programs like Nurse Corps and NHSC get the most attention, but state governments collectively spend hundreds of millions of dollars each year on their own healthcare workforce loan repayment programs. These state programs often have less competition than federal ones and can sometimes be stacked with federal benefits, meaning you could receive loan repayment from both sources at the same time.
Examples of Strong State Programs
California. The California State Loan Repayment Program (SLRP) offers up to $50,000 for a two-year commitment at an approved site in a shortage area. It is open to a broad range of healthcare providers including registered nurses and nurse practitioners.
Texas. The Texas Higher Education Coordinating Board administers multiple loan repayment programs for healthcare workers. The Physician Education Loan Repayment Program offers up to $160,000, and the state also runs targeted programs for nurses, mental health professionals, and allied health workers who practice in underserved areas.
New York. The New York State Get on Your Feet Loan Forgiveness Program covers up to 24 months of federal student loan payments for recent graduates earning under $50,000. New York also participates in the State Loan Repayment Program, which offers awards to healthcare workers in Health Professional Shortage Areas.
Florida. The Florida Nursing Student Loan Forgiveness Program forgives student loans for nurses who work in Florida public or nonprofit facilities that serve a high proportion of low-income patients. Awards are distributed on a per-year-of-service basis.
Illinois. The Illinois Nurse Educator Loan Repayment Program provides loan repayment for nurses who commit to teaching in Illinois nursing programs, addressing the same faculty shortage that the federal Nurse Corps program targets.
How to Find Your State’s Programs
Every state administers its programs differently. The best starting point is the HRSA State Loan Repayment Program directory, which lists programs that receive federal matching funds. You can also search your state’s higher education agency or health department website. Many states open applications on different schedules than the federal programs, so keeping a calendar of deadlines matters.
Public Service Loan Forgiveness for Healthcare Workers
How PSLF Fits In
If you carry federal student loans and work full-time for a qualifying nonprofit hospital, community health center, or government agency, the Public Service Loan Forgiveness (PSLF) program forgives your remaining federal balance after 120 qualifying monthly payments — 10 years. PSLF is not healthcare-specific, but it is highly relevant because so many healthcare employers are nonprofits or government entities.
As of early 2025, the Department of Education has approved over $74 billion in PSLF discharges for more than 1,050,000 borrowers. Healthcare workers make up one of the largest groups of PSLF recipients.
Stacking PSLF With Nurse Corps or NHSC
Here is where things get interesting. You can participate in Nurse Corps or NHSC loan repayment and pursue PSLF at the same time, as long as your employer qualifies for PSLF and you are making payments on any remaining balance under an income-driven repayment plan. The Nurse Corps or NHSC payments reduce your principal, and your qualifying monthly payments continue to count toward the 120 required for PSLF. After 10 years, whatever is left gets forgiven. This combination can eliminate your entire balance years sooner than either program alone.
To take advantage of this, make sure you are enrolled in an income-driven repayment plan and submit the PSLF Employment Certification Form annually so your qualifying payments are tracked from the start.
Challenges You Should Prepare For
Loan forgiveness programs are real, but they are not effortless. Here are the roadblocks that trip people up.
Competitive application pools. Federal programs like Nurse Corps and NHSC receive far more applications than they can fund. In recent years, fewer than one in four Nurse Corps applicants received an award. Apply to multiple programs rather than counting on a single one.
Service location requirements. Most programs require you to work in a designated shortage area, which often means rural communities or underserved urban neighborhoods. If you are set on working at a large academic medical center in a major city, you may not qualify for the biggest awards. Be honest about where you are willing to live and work for two to three years.
Tax implications. Nurse Corps and NHSC payments are considered taxable income by the IRS. If you receive $25,000 in loan repayment in a single year, you could owe several thousand dollars in additional federal and state income taxes. PSLF forgiveness, by contrast, is tax-free under current law through at least 2025. Budget for taxes on any non-PSLF forgiveness you receive.
Paperwork and tracking. PSLF requires you to certify your employment every year and make sure each monthly payment counts as "qualifying." Many borrowers have been denied because they were on the wrong repayment plan or their employer did not meet the nonprofit requirement. Use the PSLF Help Tool to verify your eligibility before you start counting payments.
Program funding uncertainty. Federal loan repayment programs depend on annual Congressional appropriations. While Nurse Corps and NHSC have been consistently funded for decades, the dollar amounts and number of awards can fluctuate. Apply when you are eligible rather than waiting for a "better" year that may not come.
The Bottom Line
If you are borrowing to pay for a nursing or healthcare degree, loan forgiveness is not a distant fantasy — it is a concrete financial strategy you can plan around starting right now. The Nurse Corps Loan Repayment Program can cover up to 85 percent of your nursing school debt. The National Health Service Corps offers up to $50,000 — or $75,000 for substance use disorder work — for a two-year commitment. State-level programs add another layer of potential relief, and PSLF can wipe out whatever remains after 10 years of qualifying payments at a nonprofit or government employer. The students who benefit most learn about these programs before they graduate, choose employers strategically, and keep their paperwork in order from day one.
Frequently Asked Questions
Can I apply to both Nurse Corps and NHSC at the same time? You cannot hold both awards simultaneously, but you can apply to both and accept whichever you receive. If you complete one program, you may then be eligible to apply for the other. You can also pursue PSLF alongside either program.
Do I need to be done with school to apply? Yes. Both Nurse Corps and NHSC require you to have completed your degree and hold an active license before you apply. You cannot apply while you are still a student, but you can research programs, identify eligible sites, and plan your first job placement while you are still in school.
Are private student loans eligible for these programs? For Nurse Corps, yes — both federal and private education loans qualify. For NHSC, only government and commercial loans used for educational purposes are eligible. For PSLF, only federal Direct Loans qualify. If you hold private loans that are not eligible for PSLF, Nurse Corps or a state program may be your best path to repayment assistance.
What counts as a Critical Shortage Facility for Nurse Corps? Critical Shortage Facilities include health facilities with a Critical Shortage Facility score determined by HRSA, such as community health centers, disproportionate share hospitals, state or local public health departments, skilled nursing facilities, and certain Indian Health Service facilities. You can search for eligible facilities on the HRSA data website.
Will loan forgiveness affect my credit score? No. Loan repayment through these programs goes directly to your lender on your behalf, counting as regular on-time payments. Reducing your balance faster can actually improve your debt-to-income ratio over time.
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— Sravani at CollegeLens