Federal Loans Among US Medical Students

Abstract

This study evaulates trends in federal loan use among US medical students and how they may be affected by the One Big Beautiful Bill Act, which eliminated Graduate PLUS loans for medical students.

The US has the world’s highest cost of medical school attendance.¹ To finance their education, more than half of medical students borrow federal or private loans.² However, the federal government’s role in financing undergraduate medical education was recently circumscribed by the 2025 One Big Beautiful Bill Act (OBBBA). The law eliminated Graduate PLUS Loans, which allowed medical students to borrow up to their total cost of attendance, instituted caps on both annual ($50 000 maximum) and lifetime ($200 000 maximum) federal loans for medical students, and reduced the generosity of loan forgiveness and repayment programs.³ Researchers have raised concerns that these restrictions may adversely affect the physician workforce.⁴ To understand the scope of these consequences, we evaluated trends in federal loan use among medical students and those most affected by the OBBBA.

Methods

We analyzed the 2008-2020 National Postsecondary Student Financial Aid Survey (NPSAS), which collects information on student federal loan debt every 4 years (eMethods in Supplement 1).⁵ Our sample included medical students (weighted N = 383 754, response rate ≥ 71.3% for each wave) across all years of medical school. We examined 3 primary outcomes related to OBBBA restrictions: having any Graduate PLUS Loans, having annual federal loans of more than $50 000 in the survey year, and having cumulative undergraduate and graduate federal loans of more than $200 000. We also assessed self-reported cost of medical school attendance.

We described trends in our outcomes between 2008 and 2020. Multivariable logistic regressions were fit to estimate the association between student characteristics and primary outcomes in 2020, the most recent year of available data. We used NPSAS survey weights to generate nationally representative estimates. Statistical analyses were conducted in PowerStats with 2-sided tests and α = .05. This study was exempted from institutional review board review because it used publicly available, deidentified data.

Results

Between 2008 and 2020, the inflation-adjusted annual cost of medical school attendance rose from $51 400 to $71 000, a 38% increase (Figure, A). The proportion of students using Graduate PLUS Loans increased by 262% from 13% in 2008 to nearly half (47%) in 2020 (Figure, B). In 2020, annual federal loans exceeded $50 000 for 40% of medical students (7.7% in 2008), and lifetime federal loans exceeded $200 000 for 14% of medical students (0.6% in 2008). The proportion of students with lifetime federal loans exceeding $200 000 grew over the course of medical school (Figure, C).

Figure. Trends in Medical School Costs and Loan Borrowing.

A, The cost was measured in 2020 US dollars using the Consumer Price Index. Cost of attendance includes tuition, fees, and other student financial requirements (housing and food). B, Trends in borrowing are displayed separately for medical students using a Graduate PLUS Loan, having an annual federal loan amount greater than $50 000 in the year of survey, or having a cumulative or lifetime federal loan amount exceeding $200 000. The 3 categories are not mutually exclusive. C, Proportion of medical students with lifetime federal loans of more than $200 000 are displayed over the course of medical school using 2020 data.

Across student characteristics, those attending medical school outside their home state were significantly more likely to use Graduate PLUS Loans (adjusted odds ratio [aOR], 1.91 [95% CI, 1.15-3.19]) and have annual federal loans of more than $50 000 (aOR, 2.65 [95% CI, 1.56-4.49]) (Table). Students reporting annual income below $10 000 had higher odds of incurring lifetime federal loan debt exceeding $200 000 (aOR, 3.30 [95% CI, 1.52-7.14]). Finally, students who were aware of loan forgiveness programs were more likely to use Graduate PLUS Loans (aOR, 3.52 [95% CI, 1.71-7.22]) and have annual federal loans of more than $50 000 (aOR, 3.25 [95% CI, 1.35-7.80]).

Table. Characteristics of Medical Students Borrowing Federal Loans in 2020 by Loan Type.

	Medical students with Graduate PLUS Loansa		Medical students with annual federal loans >$50 000a		Medical students with lifetime federal loans >$200 000a
	Adjusted odds ratio (95% CI)	P value	Adjusted odds ratio (95% CI)	P value	Adjusted odds ratio (95% CI)	P value
Sex
Male	1 [Reference]		1 [Reference]		1 [Reference]
Female	1.02 (0.69-1.51)	.93	1.03 (0.69-1.54)	.88	0.84 (0.47-1.49)	.56
Race and ethnicityb
Hispanic	0.81 (0.33-1.98)	.65	0.84 (0.36-1.97)	.68	1.17 (0.40-3.44)	.78
Non-Hispanic Black	1.10 (0.24-5.11)	.90	1.46 (0.32-6.61)	.62	0.82 (0.00-24 134.97)	.97
Non-Hispanic White	1 [Reference]		1 [Reference]		1 [Reference]
Non-Hispanic other	0.90 (0.29-2.86)	.86	0.95 (0.30-2.96)	.92	0.89 (0.31-2.54)	.82
Attending institution in state of legal residence
In state	1 [Reference]		1 [Reference]		1 [Reference]
Out of state	1.91 (1.15-3.19)	.01	2.65 (1.56-4.49)	<.001	1.65 (0.80-3.39)	.17
Students’ permanent residencec
Large city	1 [Reference]		1 [Reference]		1 [Reference]
Midsize city	1.76 (0.80-3.83)	.16	2.18 (0.86-5.54)	.10	2.43 (0.74-7.98)	.15
Small city	1.66 (0.34-8.12)	.53	2.15 (0.42-10.98)	.36	1.72 (0.01-366.08)	.84
Suburban	1.89 (1.02-3.53)	.045	2.13 (1.06-4.28)	.04	1.19 (0.50-2.82)	.69
Rural	1.72 (0.60-4.88)	.31	2.03 (0.81-5.05)	.13	0.62 (0.02-22.89)	.79
Disabilityd
No	1 [Reference]		1 [Reference]		1 [Reference]
Yes	2.37 (0.49-11.52)	.29	1.57 (0.46-5.39)	.48	0.55 (0.11-2.71)	.46
Student income, $
<10 000	0.76 (0.39-1.48)	.42	0.88 (0.43-1.79)	.72	3.30 (1.52-7.14)	.003
10 000-50 000	1 [Reference]		1 [Reference]		1 [Reference]
>50 000	0.80 (0.21-3.06)	.74	0.51 (0.13-1.98)	.33	0.85 (0.00-820 903.50)	.98
Immigrant status
US citizen with citizen parents	1 [Reference]		1 [Reference]		1 [Reference]
US-born citizen, non–US-born parent(s)	1.04 (0.29-3.80)	.95	1.02 (0.27-3.88)	.98	0.65 (0.18-2.34)	.51
Non–US-born citizen	1.13 (0.36-3.55)	.83	0.84 (0.27-2.64)	.77	1.17 (0.26-5.21)	.83
Aware of student loan forgiveness programs
No	1 [Reference]		1 [Reference]		1 [Reference]
Yes	3.52 (1.71-7.22)	<.001	3.25 (1.35-7.80)	.009	3.58 (0.66-19.49)	.14

^a Models were estimated separately for 3 outcomes: (1) medical students with Graduate PLUS Loans, (2) medical students with greater than $50 000 in annual federal loans, and (3) medical students with greater than $200 000 in lifetime or cumulative federal loans.

^b Race and ethnicity were self-reported in the National Postsecondary Student Aid Survey. Other race refers to Asian, Native American and Pacific Islander, and individuals with multiple race and ethnicity categories.

^c Students’ permanent residence was created from urban-centric locale codes from the 2010 Census, which stratifies residential status into large city, midsize city, small city, suburban (which includes towns), and rural.

^d Disability refers to students who answered yes to any of the following: difficulty hearing, difficulty seeing, difficulty concentrating, and difficulty walking or climbing stairs.

Discussion

We found that the cost of medical school attendance has increased over the past decade, with trainees increasingly relying on federal loans to finance their education. Our findings highlight how new OBBBA loan restrictions will affect students, including the elimination of Graduate PLUS loans (affecting 1 in 2 students) and annual federal loan caps (affecting 2 in 5 students). Although the OBBBA impact will likely be broad given the high prevalence of federal loan use, the current results suggest that low-income and out-of-state medical students will disproportionately experience the impact.

Limitations of this study include a reliance on self-reported outcomes, the inability to disaggregate MD and DO students, and using pre-OBBBA 2008-2020 data to project potential implications for the future physician workforce, which likely underestimates the OBBBA impact given the recent and continued growth in the cost of medical school attendance.¹

Together, the OBBBA loan restrictions and rising cost of medical school attendance may force students to borrow from private lenders with higher interest rates, push students away from lower-reimbursed but important specialties such as primary care, or discourage medical careers altogether, disproportionately impacting underrepresented students.⁶ Policymakers and medical schools should prioritize efforts to reduce student debt and make medical education more accessible through loan forgiveness expansion and tuition reduction.

Supplement 1.

eMethods

eReferences

Supplement 2.

Data Sharing Statement