Pharmacist student loan forgiveness: What to know

The average pharmacist graduates with more than $179,000 in student loan debt, according to a 2020 study by the American Association of Colleges of Pharmacy. Paying off that debt could take years (if not decades), but several pharmacist student loan forgiveness programs are available to help repay a portion of the balance.

Here’s a look at some pharmacist student loan forgiveness programs, who’s eligible, and what they offer.

• Public Service Loan Forgiveness
• State-based pharmacist student loan forgiveness
• National Institutes of Health Loan Repayment Program
• National Health Service Corps Substance Use Disorder Workforce Loan Repayment Program
• Health Resources & Services Administration Faculty Loan Repayment Program
• Armed Forces Active Duty Health Professions Loan Repayment Program
• Indian Health Service Loan Repayment Program
• Refinancing your student loans

Public Service Loan Forgiveness

The Public Service Loan Forgiveness (PSLF) Program is available to federal student loan borrowers who work for certain employers. You may qualify for this program if you’re employed full-time by the U.S. government; state, local, or tribal governments; or certain not-for-profit organizations.

If you’re eligible, the PSLF program will forgive your remaining federal student loan debt after you make 120 qualifying payments while working for a qualifying employer. You must also be making payments under an income-driven repayment (IDR) plan and have Direct Loans (or consolidate your existing federal loans into a federal Direct Consolidation Loan). For more information about PSLF, visit the Federal Student Aid website.

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State-based pharmacist student loan forgiveness

Depending on where you live, a state-based loan forgiveness program for pharmacists might also be an option. State-specific programs vary, but they generally offer partial loan forgiveness to medical professionals in exchange for a commitment to work in a designated area or organization.

Here are a few state-based pharmacist student loan forgiveness programs and how much assistance they offer:

Arizona

• Program: Arizona Department of Health Services Loan Repayment Program
• Available forgiveness: Up to $50,000 during the first two years, $25,000 in the third year, $20,000 in the fourth year, and $10,000 in the fifth year and each subsequent year

California

• Program: California State Loan Repayment Program
• Available forgiveness: Up to $50,000 during the first two years of full-time service, then $20,000 in extension years one and two and $10,000 in extension years three and four; up to $50,000 during the first four years of part-time service, then $10,000 in extension years one and two and $5,000 in extension years three and four

Colorado

• Program: Colorado Health Service Corps loan repayment
• Available forgiveness: Up to $60,000 with a full-time obligation and up to $30,000 with a part-time obligation, both with a three-year commitment at an approved site

Idaho

• Program: Idaho State Loan Repayment Program
• Available forgiveness: Between $10,000 and $25,000 per year (depending on employer match) with a two-year obligation

Kentucky

• Program: Kentucky State Loan Repayment Program
• Available forgiveness: Up to $80,000 with a two-year commitment and sponsor match

Massachusetts

• Program: Massachusetts Loan Repayment Program for Health Professionals
• Available forgiveness: Up to $40,000 with a two-year, full-time contract

Minnesota

• Program: Minnesota Rural Pharmacist Loan Forgiveness program
• Available forgiveness: $24,000 per year with a minimum service obligation of three years and a maximum service obligation of four years in a rural area

Nebraska

• Program: Nebraska Loan Repayment Program
• Available forgiveness: Up to $15,000 per year with employer match, up to $100,000 maximum

New Mexico

• Program: New Mexico Health Professional Loan Repayment Program
• Available forgiveness: Up to $35,000 per year with a two-year minimum commitment to practice full-time in a health professional shortage area

North Dakota

• Program: North Dakota State Loan Repayment Program
• Available forgiveness: Up to $50,000 per year for a full-time commitment and up to $25,000 per year for a half-time commitment to practice for two years in a selected area

Oregon

• Program: Oregon Health Care Provider Incentive Loan Repayment
• Available forgiveness: Up to $50,000 per year with a full-time, three-year minimum obligation, up to 50% of total eligible loan debt balance; up to $25,000 per year with a part-time, three-year minimum obligation

If you don’t live in a state that offers a pharmacist student loan forgiveness program, refinancing might help make your student loan payments more manageable. You can compare private student loan refinance rates using Credible, and it won’t affect your credit score.

National Institutes of Health Loan Repayment Program

The National Institutes of Health (NIH) Loan Repayment Program offers up to $50,000 per year to eligible pharmacists, depending on their total private and federal loan debt. This award is generally aimed at pharmacists in research or lower-paying jobs within or outside of the NIH in exchange for a commitment to engage in research with the NIH. To learn more, visit the NIH Loan Repayment Program page.

National Health Service Corps Substance Use Disorder Workforce Loan Repayment Program

The National Health Service Corps (NHSC) offers a loan forgiveness program aimed at helping fight the U.S. opioid crisis. The NHSC Substance Use Disorder Workforce Loan Repayment Program offers up to $75,000 in loan repayment in exchange for a three-year commitment.

During this commitment, awardees must work full- or part-time at NHSC-approved sites and provide substance abuse disorder treatment. These sites are generally considered to be health professional shortage areas. For more information, visit the NHSC SUD Workforce LRP page.

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Health Resources & Services Administration Faculty Loan Repayment Program

For pharmacists who also serve as faculty at approved health professions schools, the HRSA Faculty Loan Repayment Program offers up to $40,000 in loan repayment assistance. This program is limited to applicants with at least a two-year contract of employment who come from an economically disadvantaged background. To learn more, visit the HRSA Faculty Loan Repayment Program page.

Armed Forces Active Duty Health Professions Loan Repayment Program

Each branch of the military participates in the Armed Forces Active Duty Health Professions Loan Repayment Program. Though each program has a different name according to the branch you’re contracted to, they all offer the same benefit — up to $40,000 per year for up to two years for eligible active-duty service members.

This means a maximum loan forgiveness benefit of $80,000. With this program, federal taxes are taken from the loan forgiveness award before it’s disbursed. These taxes equate to about 25% of the award amount. Contact the program manager of the military branch you’re serving in for more information.

Indian Health Service Loan Repayment Program

In exchange for a two-year clinical commitment, the Indian Health Service Loan Repayment Program offers eligible medical professionals up to $40,000 toward their student loan debt. To qualify, awardees will need to practice in American Indian or Alaska Native communities with staffing needs for an initial service commitment of two years.

After the initial two years, this contract can be extended each year until all your qualified student loan debt is repaid. Visit the IHS Loan Repayment Program page to learn more.

Refinancing your student loans

If your career doesn’t qualify for one of these student loan forgiveness programs, or your loans aren’t eligible, refinancing your student loans is another option to consider.

Refinancing can combine multiple loan balances into one single loan, simplifying the repayment process. It can also result in a lower interest rate, reduced monthly payment, a shorter repayment term, or all three.

Student loan refinancing is especially beneficial if you work in the private sector and have a manageable debt-to-income ratio (the amount of your gross monthly income that goes toward your debt payments). Applying and qualifying for a private refinance loan typically means meeting certain credit score, income, and debt burden requirements.

If you have federal student loans, it’s important to note that refinancing them into a private loan means forgoing some of their biggest benefits. You’ll lose any Public Service Loan Forgiveness eligibility once you refinance those loans to a private student loan. You’ll also lose federal forbearance or deferment benefits, as well as access to income-driven repayment plans.

While a private student loan refinance is still a good idea for many borrowers, it’s important to consider all these factors and the costs of refinancing before moving forward. If you do decide to refinance, it’s important to shop around and compare interest rates and repayment terms from three to five lenders to make sure you’re getting the best refinance deal for your situation.