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Report Shows Lack of Awareness for 12-Year-Old Loan Forgiveness Program for Doctors and Nurses

A federal incentive from 12 years ago has only attracted fewer than 18,000 doctors and nurses to rural Canada, as most medical students are unaware of the debt forgiveness program, according to a recent report.

The Department of Employment report revealed that since 2012, only 17,921 doctors and nurses have agreed to practice in underserved rural or remote communities in exchange for $172.2 million in loan forgiveness as part of the Canada Student Financial Assistance (CSFA) program.

According to the report, a lack of awareness about the loan forgiveness program has affected the number of applications.

“Intended beneficiaries learn about the benefits from different sources with word of mouth being the most common source of information,” said the report, first obtained by Blacklock’s Reporter.

In fact, half of the doctors and nurses who participated in the program “found out about the benefit from family or friends.”

The report also noted that the highest number of applications from doctors and nurses occurred from 2012 to 2015, during the “early years of the benefit.”

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The report’s authors recommended a renewed focus on informing medical students and professionals about the program.

“Since its launch, awareness creation has not been a key component of the benefit,” the authors said, adding that increased promotion of the program would likely result in more applications and, ultimately, more doctors and nurses relocating to designated communities.

Loan Forgiveness

The program aims to provide partial student loan forgiveness to eligible health care professionals, such as family doctors, nurses, and nurse practitioners, who agree to practice in an underserved rural or remote community for up to five years.

In 2012, Ottawa amended the Canada Student Loans Act to forgive up to $40,000 in loans for doctors and $20,000 for nurses. Last year, the government increased loan forgiveness to $60,000 for doctors and $30,000 for nurses.

“Research demonstrates that loan forgiveness and loan repayment programs are strong incentives that may influence medical residents’ career choices,” Ottawa wrote in a statement last year when it raised loan forgiveness rates.
Currently, a family doctor would be eligible for up to $8,000 in loan forgiveness during the first year, $10,000 for the second year, $12,000 for the third, $14,000 for the fourth, and $16,000 for the fifth year.

Nurses and nurse practitioners would be eligible for up to $4,000 in loan forgiveness during the first year, $5,000 for the second year, $6,000 for the third, $7,000 for the fourth, and $8,000 for the fifth year.

Without the benefit, 38 percent of doctors and 42 percent of nurses said they would be “unlikely to move to a designated community,” the report said, adding that approximately 600 communities attracted a new doctor or nurse under the program.

As of 2022, Canada had 96,020 doctors, with 92 percent working in urban areas, according to the Canadian Institute for Health Information.

Program Retention

A 2020 survey of program beneficiaries revealed that 69 percent of those who were no longer on the benefit chose to stay in a designated community after their eligibility expired.

More than half of all beneficiaries—54 percent—continued to work in the same designated community where they first qualified for loan forgiveness. The remaining 15 percent worked in a different rural community.

Doctors working between 250 and 499 kilometers from a central metropolitan area were twice as likely to spend an additional year on the benefit than those living less than 50 kilometers away, the report said. Those working between 500 and 999 kilometers were more than three times as likely.

The report also found that having a spouse or dependents increased the time spent taking advantage of the program unless the spouse was also contributing to household income.

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