What is the Health Education Assistance Loan (HEAL) Program?

Image of doctor putting money in a piggy bank

The HEAL Program is a loan program that, between the years of 1978 and 1998, insured loans that were made to eligible graduate students studying medicine, osteopathy, dentistry, veterinary medicine, optometry, podiatry, public health, pharmacy, chiropractic, or in health admin or clinical psychology programs. While you may fall under the qualifications for the HEAL Program, you will not be able to obtain a Health Education Assistance Loan. The granting of Health Education Assistance Loans was discontinued on September 30th, 1998.

What is the interest on a Health Education Assistance Loan?

According to the Public Health Service Act, "the maximum interest which may be charged to the borrower on the unpaid balance of the loan may not exceed the average bond-equivalent rate during the prior calendar quarter for 91-day Treasury bills sold at auction, plus three percent, rounded to the next higher 1/8 of one percent."

Who do I send my Health Education Assistance Loan repayment to?

According to the Public Health Service Act, "repayment begins the first day of the 10th month after the month the borrower ceases to be a full-time student at a HEAL school. The 9-month period before the repayment period begins is called the "grace period." However, if the borrower becomes an intern or resident in an accredited program within 9 full months after leaving school, repayment will begin the first day of the 10th month after the borrower ceases to be an intern or a resident. A borrower has from 10 to 25 years to repay the loan after the repayment period starts even when the borrower participates in an authorized deferment program. There is no penalty for prepayment. Overdue accounts will be aggressively pursued and referred to collection agencies and credit bureaus or for legal action when borrowers fail to meet the terms of their loans."

What are my HEAL repayment options?

Two repayment options were available while this loan was in use:

  • Graduated repayment - It was mandatory that lenders and lender services offered this option to borrowers that required smaller payments early on in their repayment period.
  • Income-contingent - It was mandatory that lenders and lender services offered this repayment schedule and base it on the borrower's income during their first 5 years of repayment.

Is a deferment possible for this type of loan?

Since it typically takes a student between 10-25 years to pay off a Health Education Assistance Loan, there should be very few instances of a student needing a deferment. However, should this occur, it is important to note that your interest will continue to accrue:

  • During full-time study at a HEAL school or at a higher education institute that is eligible to participate in Title IV student aid programs
  • Up to 3 years during full-time active duty in the Armed Forces
  • Up to 3 years for service in the Peace Corps, VISTA, or the National Health Service Corps (3 years per service program)
  • Up to 2 years for specified fellowship and educational training programs
  • Up to 4 years for internships and residence training
  • Up to 1 year for graduates from schools of chiropractic
  • Up to 3 years upon completion of an internship or residency training program in osteopathic general practice, family medicine, general internal medicine, preventative medicine, or general pediatrics and is practicing primary care
  • Up to 3 years for providing health care services to Indians through an Indian Health Service funded health program or facility.

Is a forebearance possible for a HEAL?

Much like the deferment, the typical student with this loan will most likely not require forbearance at this stage in their loan repayment. However, if you require forbearance, you must contact your lender and lender servicers in order to request forbearance. You may be granted forbearance in periods of 6 months and capping once you reach the maximum of 3 years. If you require an extension, this can only be granted by the Secretary. It is important to note that, according to the Public Health Service Act, "Any period of forbearance granted to a HEAL borrower shall not be included in the 25 year loan repayment period for loans made on or after 10/13/1992."