Student Loan Interest Rates

Congress Should Act to Stop July 1 Student Loan Interest Rate Hike

June 21, 2013 03:57 pm News Staff

"I urge the United States Congress to enact legislation to prevent any increase in student loan interest rates," said AAFP Board Chair Glen Stream, M.D., M.B.I, of Spokane, Wash., in a short but straightforward letter sent to Senate Majority Leader Harry Reid, D-Nev., and Senate Minority Leader Mitch McConnell, R-Ky., on June 18. On the House side, Speaker John Boehner, R-Ohio, and Democratic leader Nancy Pelosi, D-Calif., also received the Academy's letter(1 page PDF).

[Student Debt - Chalkboard]

The letter represents a final push by the Academy to stave off an interest rate hike on student loans that is set to take effect on July 1.

Stream said the increased interest rate would "greatly exacerbate" an already significant debt burden for many young Americans and added that medical students and residents "are hit hardest by the exploding cost of higher education in the United States because of the length of their training."

The median student loan debt for 2012 medical school graduates was $170,000, said Stream, noting that an increase in student loan interest rates would disproportionately affect the career choices of students interested in primary care.

"It is unwise to add to the medical student debt burden which is known to be driving physicians away from primary care specialties," he said.

In the same letter, Stream called on Congress to support measures that would expand funding for federal loan programs that support primary care.

Finally, he said, existing federal policy should be changed to allow deferment of interest and principal payments on medical student loans until after completion of postgraduate training, as well as tax-deductibility of interest on principal payments after loan repayment begins.

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