Healthcare providers and employers in the US are facing unprecedented challenges regarding employee shortages, retention, and worker satisfaction. The Association of American Medical Colleges (AAMC) predicts a shortage of 37,800—124,000 physicians in the next ten years. Forecasts for other healthcare workers – such as nurses and therapists – also predict significant deficits.
A major factor exacerbating this crisis is the high student loan debt burdening many healthcare professionals. However, the student loan debt crisis is also an opportunity for hospitals and healthcare employers to step up and offer innovative solutions. Employers can help workers reduce debt and stress levels while alleviating personnel shortages and low retention rates in the industry.
Let’s look at what student loan debt looks like for medical professionals and how employers can help alleviate it.
The burden of student loan debt for healthcare professionals
Student loan debt in the healthcare industry is high because of the education required. On average, doctors undergo 11–16 years of education. This includes four years of pre-med undergraduate studies, four years of medical school, and a residency of three to seven years, with the potential for more time to specialize with a fellowship.
Registered nurses require two-year Associate Degree in Nursing (ADN) or a four-year Bachelor of Science degree in Nursing (BSN). Nurse practitioners need a Master of Science in Nursing (MSN), which requires another two years of study. Doctors of Nursing Practice (DNPs) must have a BSN or MSN and an additional three to five years of full-time study.
Beyond the financial crunch, the burden of student debt can impact quality of life and mental health. Healthcare professionals can experience diminished job satisfaction and lower motivation, resulting in more employee shortages and a lower quality of patient care.
Average student loan debt for doctors
A doctor’s average student loan debt is $243,483, more than seven times that of the average four-year college graduate. Paying off medical school debt can take 10–30 years, excluding undergraduate student loans.
Average student loan debt for nurses
The average student loan debt for nurses ranges from $19,928 for ADNs with an associate’s degree, to $47,321 for nurses with a master’s degree, such as APRNs, and $187,787 for nurse practitioners with doctorates. The average time to pay off student loan debt for an MSN is 18 years.
The role of healthcare employers
Social and economic conditions like the COVID-19 pandemic have exacerbated the current healthcare industry crisis, contributing to record personnel shortages, employee burnout, and dissatisfaction. Inflation and economic downturns have also impacted to the situation. These conditions create a challenge for healthcare employers. They are a call to action to address the core issues, especially student loan debt, to help ease the burden on workers.
Student loan benefits
Financial health and wellness, which measures an individual's ability to manage expenses, cope with economic setbacks, and build wealth, is critical to the wellbeing and morale of employees.
A 2022 TIAA Financial Wellness Survey found that over half of all respondents and 65% of Gen Z respondents believe that employers have a responsibility to help employees improve their financial wellness. Student loan benefits can be a key part of a holistic benefits package that helps employees improve and feel secure in their financial wellness.
Mental health
The burden of student debt can affect more than just financial security: It can impact mental health by contributing to prolonged stress, burnout, and depression.
Many healthcare workers struggle to manage student debt while trying to move forward with their lives. They may postpone important life milestones like buying a home and starting a family, which can lead to a sense of instability and helplessness.
Industry health
Healthcare employers have a responsibility to make the industry more viable and attractive as a field. Implementing programs like student loan benefits demonstrates a commitment to enhancing employees' wellbeing and helps create a more stable and motivated workforce. Financially secure, motivated employees can mean employers can recruit and retain top talent—a crucial part of delivering high-quality patient care.
Expansion of eligibility
By expanding eligibility for student loan benefits, employers can better attract and retain a wider range of employees. For example, instead of offering benefits after a period of employment, such as six months, employers can start student loan benefits immediately, with a contribution that increases with the employee's tenure. Or employers can extend benefits to part-time workers.
Solutions in partnership with student loan experts
Through Laurel Road Student Loan Freedom,SM we provide tailored student loan solutions for healthcare professionals in collaboration with employers. Employees start with a free 1–1 consultation with one of our specialists who can walk them through their all their student loan options, help them understand their eligibility for federal student loan forgiveness, and develop a customized plan.
Student loan forgiveness counseling
Eligible employees pursuing forgiveness through either the federal Public Service Loan Forgiveness (PSLF) or Income-Driven Repayment (IDR) programs can sign up for our annual forgiveness counseling memberships for ongoing help staying on the path to student loan forgiveness, year-after year.
Refinancing
For employees with private student loans, strategically refinancing could mean obtaining a better interest rate and terms for those who qualify. Laurel Road offers refinancing options that can help borrowers save.
Advantages of benefit program implementation
Offering student loan benefits can be a key strategy for healthcare employers in today’s marketplace where45% of workers now consider loan repayment the most critical benefit. These benefits can contribute to employees’ financial wellness and reduce financial stress, which can mean a healthier, more supportive workplace culture, and better patient care.
Explore student loan benefits for employees
Student loan benefits address a vital need by helping workers find a path to debt reduction, loan forgiveness, and financial security.
Offering student loan benefits can aid in recruiting and retaining top healthcare talent. By addressing this need, employers can help rejuvenate an industry plagued by personnel shortages and contribute to quality patient care for all.
If you’re looking to implement student loan benefits, Laurel Road offers both customizable and turnkey solutions, and can work with you to find the package that best meets your needs. To explore how your organization can benefit from offering student loan debt solutions, visit our employer partnerships page.
