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e-CFR data is current as of March 3, 2021

Title 38Chapter IPart 17 → Subject Group

Title 38: Pensions, Bonuses, and Veterans' Relief

Specialty Education Loan Repayment Program

Source: 85 FR 45535, July 29, 2020, unless otherwise noted.

§17.525   Purpose.

The purpose of §§17.525 through 17.531 is to establish the Specialty Education Loan Repayment Program (SELRP). The SELRP is an incentive program for certain individuals to meet VA's need for physicians in medical specialties for which VA determines that recruitment and retention of qualified personnel is difficult. Assistance under the SELRP may be in addition to other assistance available to individuals under the Educational Assistance Program under 38 U.S.C. 7601.

§17.526   Definitions.

The following definitions apply to §§17.525 through 17.530:

Educational loan means a loan, government or commercial, made for educational purposes by institutions that are subject to examination and supervision in their capacity as lending institutions by an agency of the United States or of the state in which the lender has its principal place of business. Loans must be for the actual costs paid for tuition, and other reasonable educational expenses such as living expenses, fees, books, supplies, educational equipment and materials, and laboratory expenses. Loans must be obtained from a government entity, a private financial institution, a school, or any other authorized entity stated in this definition. The following loans do not qualify for the SELRP:

(1) Loans obtained from family members, relatives, or friends;

(2) Loans made prior to, or after, the individual's qualifying education;

(3) Any portion of a consolidated loan that is not specifically identified with the education and purposes for which the SELRP may be authorized, such as home or auto loans merged with educational loans;

(4) Loans for which an individual incurred a service obligation for repayment or agreed to service for future cancellation;

(5) Credit card debt;

(6) Parent Plus Loans;

(7) Loans that have been paid in full;

(8) Loans that are in default, delinquent, not in a current payment status, or have been assumed by a collection agency;

(9) Loans not obtained from a bank, credit union, savings and loan association, not-for-profit organization, insurance company, school, and other financial or credit institution which is subject to examination and supervision in its capacity as a lending institution by an agency of the United States or of the state in which the lender has its principal place of business;

(10) Loans for which supporting documentation is not available;

(11) Loans that have been consolidated with loans of other individuals, such as spouses, children, friends, or other family member; or

(12) Home equity loans or other noneducational loans.

SELRP means the Specialty Education Loan Repayment Program established in §§17.525 through 17.530.

State means a State as defined in 38 U.S.C. 101(20), or a political subdivision of such a State.

VA means the Department of Veterans Affairs.

§17.527   Eligibility.

(a) General. An individual must meet the following requirements to be eligible to participate in the SELRP:

(1) Will be eligible for appointment under 38 U.S.C. 7401 to work as a physician in a medical specialty for which VA determines that recruitment or retention of qualified personnel is difficult. In determining staffing needs, VA will consider the anticipated needs of VA for a period of two to six years in the future. VA will publish these vacancies in a notice in the Federal Register on a yearly basis until vacancies are filled.

(2) Owes any amount of principal or interest for an educational loan where the proceeds were used by or on behalf of the individual to pay costs relating to a course of medical education or training that leads to employment as a physician and;

(3) Is:

(i) Recently graduated from an accredited medical or osteopathic school and matched to an accredited residency program in a medical specialty designated by VA; or

(ii) A physician in training with more than 2 years remaining in such training.

(b) Applicants without a residency match. An applicant may apply for the SELRP before receiving a residency match during the applicant's senior year of medical or osteopathic school. Once the applicant is matched with a residency specialty stated in §17.525 and upon selection of the SELRP, VA must offer the applicant participation in the SELRP no later than 28 days after:

(1) The applicant is matched with the residency; and

(2) VA has published the residency in a Notice in the Federal Register. Such notices are published on a yearly basis until vacancies are filled.

(c) Preferences. VA will give preference to eligible participants who:

(1) Are, or will be, participating in residency programs in health care facilities that are:

(i) Located in rural areas;

(ii) Operated by Indian tribes, tribal organizations, or the Indian Health Services; or

(iii) Are affiliated with underserved health care facilities of VA; or

(2) Veterans.

§17.528   Application.

(a) General. A complete application for the SELRP consists of a completed application form, letters of reference, and personal statement.

(b) References. The applicant must provide the following letters of reference and sign a release of information form for VA to contact such references:

(1) One letter of reference from the Program Director of the core program in which the applicant is training, which indicates that the applicant is in good to excellent standing, or, for individuals who have yet to initiate training, a letter of reference from a faculty member or dean;

(2) One or more letters of reference from faculty members under which the applicant trained; and

(3) One letter of reference from a peer colleague who is familiar with the practice and character of the applicant.

(c) Personal statement. The personal statement must include the following documentation:

(1) A cover letter that provides the following information:

(i) Why the applicant is interested in VA employment;

(ii) The applicant's interest in working at a particular medical specialty and underserved area;

(iii) Likely career goals, including career goals in VA; and

(iv) A brief summary of past employment or training and accomplishments, including any particular clinical areas of interest (e.g., substance abuse).

(2) The following information must be provided on a VA form or online collection system and is subject to VA verification:

(i) A summary of the applicant's educational loan, which includes the total loan amount and when the loan was acquired. The educational loan must be specific to the education that was required and used to qualify the applicant for appointment as a physician.

(ii) The name of the lending agency that provided the educational loan.

(3) A full curriculum vitae.

(The Office of Management and Budget has approved the information collection requirements in this section under control number XXXX-XXXX.)

§17.529   Award procedures.

(a) Repayment amount. (1) VA may pay no more than $40,000 in educational loan repayment for each year of obligated service for a period not to exceed four years for a total payment of $160,000.00.

(2) An educational loan repayment may not exceed the actual amount of principal and interest on an educational loan or loans.

(b) Payment. VA will pay the participant, or the lending institution on behalf of the participant, directly for the principal and interest on the participant's educational loans. Payments will be made monthly or annually for each applicable service period, depending on the terms of the agreement. Participants must provide VA documentation that shows the amounts that were credited or posted by the lending institution to a participant's educational loan during an obligated service period. VA will issue payments after the participant commences the period of obligated service. Payments are exempt from Federal taxation.

(c) Waiver of maximum amount of payment. VA may waive the limitations under paragraph (a)(1) of this section to participants of the SELRP if VA determines that there is a shortage of qualified employees due to either the location of where the participant will serve the period of obligated service or the requirements of the position that the participant will hold in VA. However, the waiver may not exceed the actual amount of the principal and the interest on the participant's loans payable to or for that participant.

§17.530   Agreement and obligated service.

(a) General. In addition to any requirements under section 5379(c) of title 5, a participant in the SELRP must agree, in writing, to the following:

(1) Obtain a license to practice medicine in a State;

(2) Successfully complete postgraduate training leading to eligibility for board certification in a medical specialty;

(3) Serve as a full-time clinical practice employee of VA for 12 months for every $40,000.00 that the participant receives payment through the SELRP, however, the participant must serve for a period of no fewer than 24 months; and

(4) Except as provided in paragraph (b) of this section, begin obligated service as a full-time VA employee no later than 60 days after completing residency in the medical specialty described in §17.527(a)(1).

(b) Obligated service. (1) General provision. A participant's obligated service will begin on the date on which the participant begins full-time permanent employment with VA in the qualifying field of medicine in a location determined by VA. Obligated service must be full-time permanent employment and does not include any period of temporary or contractual employment.

(2) Location and position of obligated service. VA will provide SELRP participants a list of qualifying medical facility locations. A participant may select a service location from that list. However, VA reserves the right to make final decisions on the location and position of the obligated service.

(c) Exception to commencement of obligated service. If a participant receives an accredited fellowship in a medical specialty other than the specialty described in §17.27(a)(1), the participant may request, in writing, a delayed commencement of the period of obligated service until after the participant completes the fellowship. However, the period of obligated service will begin no later than 60 days after completion of such fellowship in the medical specialty described in §17.527(a)(1).

§17.531   Failure to comply with terms and conditions of agreement.

A participant of the SELRP who fails to satisfy the period of obligated service will owe the United States government an amount determined by the formula A = B × ((T−S) ÷ T)), where:

(a) “A” is the amount the participant owes the United States government.

(b) “B” is the sum of all payments to or for the participant under the SELRP.

(c) “T” is the number of months in the period of obligated service of the participant.

(d) “S” is the number of whole months of such period of obligated service served by the participant.

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