Service-conditional medical student aid programs

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Abstract
Medical student aid programs tied to a service commitment are in operation in 31 states. The programs provide various options for students to pay back the financial support given by the state, the most popular form being cancellation of the financial obligation to the the state if a service commitment is fulfilled. Although the statutory language and program literature claim a major objective of the programs to be the provision of manpower to underserved areas, lenient “buy-out” provisions and small awards relative to the total tuition have caused these programs to be used as sources of low-interest loans. Moreover, states do not provide subsidies to promote service in unattractive areas; thus, there is little reason for physician graduates to locate in low-income areas. State cooperation with the federal National Health Service Corps Scholarship Program, which does provide subsidies to physicians practicing in underserved areas, may provide the states a strategy for meeting their legislative objectives of providing physicians for the underserved.

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