Title 42The Public Health and WelfareRelease 119-73

§254l–1 National Health Service Corps Loan Repayment Program

Title 42 › Chapter CHAPTER 6A— - PUBLIC HEALTH SERVICE › Subchapter SUBCHAPTER II— - GENERAL POWERS AND DUTIES › Part Part D— - Primary Health Care › Subpart subpart iii— - scholarship program and loan repayment program › § 254l–1

Last updated Apr 6, 2026|Official source

Summary

Creates the National Health Service Corps Loan Repayment Program to keep enough primary care providers working in places with too few doctors and other health workers. Doctors, dentists, behavioral and mental health professionals, certified nurse midwives, nurse practitioners, physician assistants, and other needed health professionals can apply. Applicants must have the right degree or certification, be in an approved training program or in the final year of school, be eligible for Corps service, and submit an application. The program must give clear, easy-to-read application and contract forms, explain the rights and penalties, tell how someone might meet the service requirement through private practice, and give schools information to share with students. The program encourages workers to stay in shortage areas after their service, helps with the move to private practice if they stay in those areas, and asks employers to support options like job-sharing or recruiting professional couples. A person joins only after signing a written contract. The government agrees to pay eligible education loans on the person’s behalf. The person agrees to accept the payments, stay in school if required, keep good academic standing, and serve as a primary care provider in a designated shortage area for at least 2 years (or longer if they agree). Loan repayment can cover principal, interest, and related costs for undergraduate or graduate loans for tuition, fees, books, lab costs, and reasonable living expenses. The Secretary may pay up to $50,000 per year plus an inflation adjustment each year starting in fiscal year 2012. Payments for a year must be made by the end of the fiscal year when that year of service ends. The program also pays an amount equal to 39% of the loan repayments for taxes, may add more if needed, and can set a schedule with loan holders. All payments depend on money being appropriated by Congress. Trainees with contracts do not count against Department employment limits.

Full Legal Text

Title 42, §254l–1

The Public Health and Welfare — Source: USLM XML via OLRC

(a)The Secretary shall establish a program to be known as the National Health Service Corps Loan Repayment Program to assure, with respect to the provision of primary health services pursuant to section 254d(a)(2) of this title—
(1)an adequate supply of physicians, dentists, behavioral and mental health professionals, certified nurse midwives, certified nurse practitioners, and physician assistants; and
(2)if needed by the Corps, an adequate supply of other health professionals.
(b)To be eligible to participate in the Loan Repayment Program, an individual must—
(1)(A)have a degree in medicine, osteopathic medicine, dentistry, or another health profession, or an appropriate degree from a graduate program of behavioral and mental health, or be certified as a nurse midwife, nurse practitioner, or physician assistant;
(B)be enrolled in an approved graduate training program in medicine, osteopathic medicine, dentistry, behavioral and mental health, or other health profession; or
(C)be enrolled as a full-time student—
(i)in an accredited (as determined by the Secretary) educational institution in a State; and
(ii)in the final year of a course of a study or program, offered by such institution and approved by the Secretary, leading to a degree in medicine, osteopathic medicine, dentistry, or other health profession;
(2)be eligible for, or hold, an appointment as a commissioned officer in the Regular or Reserve Corps 11 See Change of Name note below. of the Service or be eligible for selection for civilian service in the Corps; and
(3)submit to the Secretary an application for a contract described in subsection (f) (relating to the payment by the Secretary of the educational loans of the individual in consideration of the individual serving for a period of obligated service).
(c)(1)In disseminating application forms and contract forms to individuals desiring to participate in the Loan Repayment Program, the Secretary shall include with such forms—
(A)a fair summary of the rights and liabilities of an individual whose application is approved (and whose contract is accepted) by the Secretary, including in the summary a clear explanation of the damages to which the United States is entitled under section 254o of this title in the case of the individual’s breach of the contract; and
(B)information respecting meeting a service obligation through private practice under an agreement under section 254n of this title and such other information as may be necessary for the individual to understand the individual’s prospective participation in the Loan Repayment Program and service in the Corps.
(2)The application form, contract form, and all other information furnished by the Secretary under this subpart shall be written in a manner calculated to be understood by the average individual applying to participate in the Loan Repayment Program.
(3)The Secretary shall make such application forms, contract forms, and other information available to individuals desiring to participate in the Loan Repayment Program on a date sufficiently early to ensure that such individuals have adequate time to carefully review and evaluate such forms and information.
(4)(A)The Secretary shall distribute to health professions schools materials providing information on the Loan Repayment Program and shall encourage the schools to disseminate the materials to the students of the schools.
(B)(i)In the case of any health professional whose period of obligated service under the Loan Repayment Program is nearing completion, the Secretary shall encourage the individual to remain in a health professional shortage area and to continue providing primary health services.
(ii)During the period in which a health professional is planning and making the transition to private practice from obligated service under the Loan Repayment Program, the Secretary may provide assistance to the professional regarding such transition if the professional is remaining in a health professional shortage area and is continuing to provide primary health services.
(C)In the case of entities to which participants in the Loan Repayment Program are assigned under section 254f of this title, the Secretary shall encourage the entities to provide options with respect to assisting the participants in remaining in the health professional shortage areas involved, and in continuing to provide primary health services, after the period of obligated service under the Loan Repayment Program is completed. The options with respect to which the Secretary provides such encouragement may include options regarding the sharing of a single employment position in the health professions by 2 or more health professionals, and options regarding the recruitment of couples where both of the individuals are health professionals.
(d)(1)Subject to section 254f–1 of this title, in providing contracts under the Loan Repayment Program—
(A)the Secretary shall consider the extent of the demonstrated interest of the applicants for the contracts in providing primary health services; and
(B)may consider such other factors regarding the applicants as the Secretary determines to be relevant to selecting qualified individuals to participate in such Program.
(2)In providing contracts under the Loan Repayment Program, the Secretary shall give priority—
(A)to any application for such a contract submitted by an individual whose training is in a health profession or specialty determined by the Secretary to be needed by the Corps;
(B)to any application for such a contract submitted by an individual who has (and whose spouse, if any, has) characteristics that increase the probability that the individual will continue to serve in a health professional shortage area after the period of obligated service pursuant to subsection (f) is completed; and
(C)subject to subparagraph (B), to any application for such a contract submitted by an individual who is from a disadvantaged background.
(e)An individual becomes a participant in the Loan Repayment Program only upon the Secretary and the individual entering into a written contract described in subsection (f).
(f)The written contract (referred to in this subpart) between the Secretary and an individual shall contain—
(1)an agreement that—
(A)subject to paragraph (3), the Secretary agrees—
(i)to pay on behalf of the individual loans in accordance with subsection (g); and
(ii)to accept (subject to the availability of appropriated funds for carrying out sections 254d through 254h of this title and section 254j of this title) the individual into the Corps (or for equivalent service as otherwise provided in this subpart); and
(B)subject to paragraph (3), the individual agrees—
(i)to accept loan payments on behalf of the individual;
(ii)in the case of an individual described in subsection (b)(1)(C), to maintain enrollment in a course of study or training described in such subsection until the individual completes the course of study or training;
(iii)in the case of an individual described in subsection (b)(1)(C), while enrolled in such course of study or training, to maintain an acceptable level of academic standing (as determined under regulations of the Secretary by the educational institution offering such course of study or training); and
(iv)to serve for a time period (hereinafter in this subpart referred to as the “period of obligated service”) equal to 2 years or such longer period as the individual may agree to, as a provider of primary health services in a health professional shortage area (designated under section 254e of this title) to which such individual is assigned by the Secretary as a member of the Corps or released under section 254n of this title;
(2)a provision permitting the Secretary to extend for such longer additional periods, as the individual may agree to, the period of obligated service agreed to by the individual under paragraph (1)(B)(iv), including extensions resulting in an aggregate period of obligated service in excess of 4 years;
(3)a provision that any financial obligation of the United States arising out of a contract entered into under this subpart and any obligation of the individual that is conditioned thereon, is contingent on funds being appropriated for loan repayments under this subpart and to carry out the purposes of sections 254d through 254h of this title and section 254j and 254k of this title;
(4)a statement of the damages to which the United States is entitled, under section 254o of this title for the individual’s breach of the contract; and
(5)such other statements of the rights and liabilities of the Secretary and of the individual, not inconsistent with this subpart.
(g)(1)A loan repayment provided for an individual under a written contract under the Loan Repayment Program shall consist of payment, in accordance with paragraph (2), on behalf of the individual of the principal, interest, and related expenses on government and commercial loans received by the individual regarding the undergraduate or graduate education of the individual (or both), which loans were made for—
(A)tuition expenses;
(B)all other reasonable educational expenses, including fees, books, and laboratory expenses, incurred by the individual; or
(C)reasonable living expenses as determined by the Secretary.
(2)(A)For each year of obligated service that an individual contracts to serve under subsection (f) the Secretary may pay up to $50,000, plus, beginning with fiscal year 2012, an amount determined by the Secretary on an annual basis to reflect inflation, on behalf of the individual for loans described in paragraph (1). In making a determination of the amount to pay for a year of such service by an individual, the Secretary shall consider the extent to which each such determination—
(i)affects the ability of the Secretary to maximize the number of contracts that can be provided under the Loan Repayment Program from the amounts appropriated for such contracts;
(ii)provides an incentive to serve in health professional shortage areas with the greatest such shortages; and
(iii)provides an incentive with respect to the health professional involved remaining in a health professional shortage area, and continuing to provide primary health services, after the completion of the period of obligated service under the Loan Repayment Program.
(B)Any arrangement made by the Secretary for the making of loan repayments in accordance with this subsection shall provide that any repayments for a year of obligated service shall be made no later than the end of the fiscal year in which the individual completes such year of service.
(3)For the purpose of providing reimbursements for tax liability resulting from payments under paragraph (2) on behalf of an individual—
(A)the Secretary shall, in addition to such payments, make payments to the individual in an amount equal to 39 percent of the total amount of loan repayments made for the taxable year involved; and
(B)may make such additional payments as the Secretary determines to be appropriate with respect to such purpose.
(4)The Secretary may enter into an agreement with the holder of any loan for which payments are made under the Loan Repayment Program to establish a schedule for the making of such payments.
(h)Notwithstanding any other provision of law, individuals who have entered into written contracts with the Secretary under this section, while undergoing academic or other training, shall not be counted against any employment ceiling affecting the Department.

Legislative History

Notes & Related Subsidiaries

Editorial Notes

Prior Provisions

A prior section 338B of act July 1, 1944, was renumbered section 338C by section 201(2) of Pub. L. 100–177 and is classified to section 254m of this title.

Amendments

2010—Subsec. (g)(2)(A). Pub. L. 111–148 substituted “$50,000, plus, beginning with fiscal year 2012, an amount determined by the Secretary on an annual basis to reflect inflation,” for “$35,000” in introductory provisions. 2003—Subsec. (e). Pub. L. 108–163 made technical amendment. 2002—Subsec. (a)(1). Pub. L. 107–251, § 310(1)(A), inserted “behavioral and mental health professionals,” after “dentists,”. Subsec. (a)(2). Pub. L. 107–251, § 310(1)(B), struck out “(including mental health professionals)” before period at end. Subsec. (b)(1)(A). Pub. L. 107–251, § 310(2), added subpar. (A) and struck out former subpar. (A) which read as follows: “must have a degree in medicine, osteopathic medicine, dentistry, or other health profession, or be certified as a nurse midwife, nurse practioner, or physician assistant;”. Subsec. (e)(1). Pub. L. 107–251, § 310(3), struck out par. (1) designation and heading. Subsec. (i). Pub. L. 107–251, § 310(4), struck out subsec. (i), which required an annual report to Congress about the Loan Repayment Program. 1998—Subsec. (b)(1)(B). Pub. L. 105–392 substituted “behavioral and mental health, or other health profession” for “or other health profession”. 1990—Subsec. (a). Pub. L. 101–597, § 202(a)(1), substituted “Corps Loan Repayment Program to assure, with respect to the provision of primary health services pursuant to section 254d(a)(2) of this title—” and pars. (1) and (2) for “Corps Loan Repayment Program (hereinafter in this subpart referred to as the ‘Loan Repayment Program’) in order to assure— “(1) an adequate supply of trained physicians, dentists, and nurses for the Corps; and “(2) if needed by the Corps, an adequate supply of podiatrists, optometrists, pharmacists, clinical psychologists, graduates of schools of veterinary medicine, graduates of schools of public health, graduates of programs in health administration, graduates of programs for the training of physician assistants, expanded function dental auxiliaries, and nurse practitioners (as defined in section 296m of this title), and other health professionals.” Subsec. (b)(1). Pub. L. 101–597, § 202(b)(1)(A), amended par. (1) generally. Prior to amendment, par. (1) read as follows: “(A) be enrolled— “(i) as a full-time student— “(I) in an accredited (as determined by the Secretary) educational institution in a State; and “(II) in the final year of a course of study or program, offered by such institution and approved by the Secretary, leading to a degree in medicine, osteopathic medicine, dentistry, or other health profession; or “(ii) in an approved graduate training program in medicine, osteopathic medicine, dentistry, or other health profession; or “(B) have— “(i) a degree in medicine, osteopathic medicine, dentistry, or other health profession; “(ii) completed an approved graduate training program in medicine, osteopathic medicine, dentistry, or other health profession in a State, except that the Secretary may waive the completion requirement of this clause for good cause; and “(iii) a license to practice medicine, osteopathic medicine, dentistry, or other health profession in a State;”. Subsec. (b)(2) to (4). Pub. L. 101–597, § 202(b)(2)(A), inserted “and” at end of par. (2), added par. (3), and struck out former pars. (3) and (4) which read as follows: “(3) submit an application to participate in the Loan Repayment Program; and “(4) sign and submit to the Secretary, at the time of the submission of such application, a written contract (described in subsection (f) of this section) to accept repayment of educational loans and to serve (in accordance with this subpart) for the applicable period of obligated service in a health manpower shortage area.” Subsec. (c)(4). Pub. L. 101–597, § 401(b)[(a)], substituted reference to health professional shortage area for reference to health manpower shortage area in subpars. (B) and (C). Pub. L. 101–597, § 202(c), added par. (4). Subsec. (d). Pub. L. 101–597, § 401(b)[(a)], substituted reference to health professional shortage area for reference to health manpower shortage area in par. (2)(B). Pub. L. 101–597, § 202(d), amended subsec. (d) generally. Prior to amendment, subsec. (d) read as follows: “In determining which applications under the Loan Repayment Program to approve (and which contracts to accept), the Secretary shall give priority to applications made by— “(1) individuals whose training is in a health profession or specialty determined by the Secretary to be needed by the Corps; and “(2) individuals who are committed to service in medically underserved areas.” Subsec. (e). Pub. L. 101–597, § 202(b)(2)(B), substituted “only upon the Secretary and the individual entering into a written contract described in subsection (f).” for “only on the Secretary’s approval of the individual’s application submitted under subsection (b)(3) of this section and the Secretary’s acceptance of the contract submitted by the individual under subsection (b)(4) of this section.” in par. (1) and struck out par. (2) which read as follows: “The Secretary shall provide written notice to an individual promptly on— “(A) the Secretary’s approving, under paragraph (1), of the individual’s participation in the Loan Repayment Program; or “(B) the Secretary’s disapproving an individual’s participation in such Program.” Subsec. (f)(1)(B)(ii), (iii). Pub. L. 101–597, § 202(b)(1)(B), substituted “subsection (b)(1)(C)” for “subsection (b)(1)(A)”. Subsec. (f)(1)(B)(iv). Pub. L. 101–597, § 401(b)[(a)], substituted reference to health professional shortage area for reference to health manpower shortage area. Pub. L. 101–597, § 202(a)(2), inserted “as a provider of primary health services” before “in a health”. Subsec. (f)(2). Pub. L. 101–597, § 202(e), inserted before semicolon at end “, including extensions resulting in an aggregate period of obligated service in excess of 4 years”. Subsec. (g)(1). Pub. L. 101–597, § 202(f)(1), inserted “regarding the undergraduate or graduate education of the individual (or both), which loans were made” after “loans received by the individual”. Subsec. (g)(2)(A). Pub. L. 101–597, § 401(b)[(a)], substituted reference to health professional shortage area for reference to health manpower shortage area in cls. (ii) and (iii). Pub. L. 101–597, § 202(f)(2)(A), substituted “For each year” for “Except as provided in subparagraph (B) and paragraph (3), for each year” and “$35,000” for “$20,000”, inserted at end “In making a determination of the amount to pay for a year of such service by an individual, the Secretary shall consider the extent to which each such determination—”, and added immediately thereafter cls. (i) to (iii). Subsec. (g)(2)(B), (C). Pub. L. 101–597, § 202(f)(2)(B), redesignated subpar. (C) as (B) and struck out former subpar. (B) which read as follows: “For each year of obligated service that an individual contracts under subsection (f) of this section to serve in the Indian Health Service, or to serve in a health program or facility operated by a tribe or tribal organization under the Indian Self-Determination Act (25 U.S.C. 450f et seq.), the Secretary may pay up to $25,000 on behalf of the individual for loans described in paragraph (1).” Subsec. (g)(3). Pub. L. 101–597, § 202(g)(1), amended par. (3) generally. Prior to amendment, par. (3) read as follows: “In addition to payments made under paragraph (2), in any case in which payments on behalf of an individual under the Loan Repayment Program result in an increase in Federal, State, or local income tax liability for such individual, the Secretary may, on the request of such individual, make payments to such individual in a reasonable amount, as determined by the Secretary, to reimburse such individual for all or part of the increased tax liability of the individual.” Subsec. (i). Pub. L. 101–597, § 401(b)[(a)], substituted reference to health professional shortage area for reference to health manpower shortage area in par. (8). Pub. L. 101–597, § 202(h), amended subsec. (i) generally. Prior to amendment, subsec. (i) read as follows: “The Secretary shall, not later than March 1 of each year, submit to the Congress a report specifying— “(1) the number, and type of health profession training, of individuals receiving loan payments under the Loan Repayment Program; “(2) the educational institution at which such individuals are receiving their training; “(3) the number of applications filed under this section in the school year beginning in such year and in prior school years; and “(4) the amount of loan payments made in the year reported on.” 1988—Subsec. (b)(1). Pub. L. 100–607 substituted “osteopathic medicine” for “osteopathy” wherever appearing.

Statutory Notes and Related Subsidiaries

Change of Name

Reference to Reserve Corps of the Public Health Service deemed to be a reference to the Ready Reserve Corps, see section 204(c)(3) of this title.

Effective Date

of 2003 AmendmentAmendment by Pub. L. 108–163 deemed to have taken effect immediately after the enactment of Pub. L. 107–251, see section 3 of Pub. L. 108–163, set out as a note under section 233 of this title.

Effective Date

of 1990 Amendment Pub. L. 101–597, title II, § 202(g)(2), Nov. 16, 1990, 104 Stat. 3026, provided that: “The amendment made by paragraph (1) [amending this section] shall apply only with respect to contracts under section 338B of the Public Health Service Act [42 U.S.C. 254l–1] (relating to service in the National Health Service Corps) that are entered into on or after the

Effective Date

of this Act [Nov. 16, 1990].”

Regulations

Pub. L. 100–177, title II, § 205, Dec. 1, 1987, 101 Stat. 1003, provided that: “Not later than 180 days after the

Effective Date

of the

Amendments

made by this title [Dec. 21, 1987], the Secretary of Health and Human Services shall issue

Regulations

for the loan repayment programs established by the

Amendments

[enacting this section and section 254q and 254q–1 of this title, amending section 242a, 254d, 254g, 254h–1, and 254o of this title, and repealing former section 254q of this title].” Clarification on Current Eligibility for Loan Repayment Programs Pub. L. 114–255, div. B, title IX, § 9023, Dec. 13, 2016, 130 Stat. 1253, provided that: “The Administrator of the Health Resources and Services Administration shall clarify the eligibility pursuant to section 338B(b)(1)(B) of the Public Health Service Act (42 U.S.C. 254l–1(b)(1)(B)) of child and adolescent psychiatrists for the National Health Service Corps Loan Repayment Program under subpart III of part D of title III of such Act (42 U.S.C. 254l et seq.).”

Reference

Citations & Metadata

Citation

42 U.S.C. § 254l–1

Title 42The Public Health and Welfare

Last Updated

Apr 6, 2026

Release point: 119-73