An Act amending the act of March 10, 1949 (P.L.30, No.14), known as the Public School Code of 1949, repealing provisions relating to medical education loan assistance.

PRINTER'S NO. 2968
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No. 2269
Session of
2026
INTRODUCED BY O'MARA, HILL-EVANS, KHAN, SANCHEZ, NEILSON,
SCHWEYER, GUENST, MADDEN, BURGOS AND CEPEDA-FREYTIZ,
MARCH 6, 2026
REFERRED TO COMMITTEE ON EDUCATION, MARCH 9, 2026
AN ACT
Amending the act of March 10, 1949 (P.L.30, No.14), entitled "An
act relating to the public school system, including certain
provisions applicable as well to private and parochial
schools; amending, revising, consolidating and changing the
laws relating thereto," repealing provisions relating to
medical education loan assistance.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Article XXII-A of the act of March 10, 1949
(P.L.30, No.14), known as the Public School Code of 1949, is
repealed:
[ARTICLE XXII-A.
MEDICAL EDUCATION LOAN ASSISTANCE.
(a) General Provisions.
Section 2201-A. Scope.
This article deals with medical education loan assistance.
Section 2202-A. Purpose.
The purpose of this article is to provide an incentive to
Pennsylvania students to pursue higher education and training in
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
medicine, professional nursing, biomedicine and the life
sciences in order to maintain the delivery of quality health
care services in this Commonwealth.
Section 2203-A. Definitions.
The following words and phrases when used in this article
shall have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Accredited medical college." An institution of higher
education located in this Commonwealth that is accredited by the
Liaison Committee on Medical Education to provide courses in
medicine and empowered to grant professional and academic
degrees in medicine as defined in the act of December 20, 1985
(P.L.457, No.112), known as the Medical Practice Act of 1985.
"Agency." The Pennsylvania Higher Education Assistance
Agency.
"Approved institution of higher learning." An institution of
higher learning located in this Commonwealth and approved by the
agency.
"Approved nursing program." An institution located in this
Commonwealth and accredited to grant professional and academic
degrees or diplomas in nursing as defined in the act of May 22,
1951 (P.L.317, No.69), known as The Professional Nursing Law.
"Degree in medicine." A degree from an accredited medical
college that qualifies the degree recipient to be licensed as a
physician.
"Designated area." Any of the following:
(1) A geographic area of this Commonwealth that is
designated by the Secretary of Health as having a shortage of
physicians.
(2) A geographic area of this Commonwealth designated by
20260HB2269PN2968 - 2 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
the United States Department of Health and Human Services as
a medically underserved area or designated to have a
medically underserved population.
"Eligible applicant." An individual who holds an
undergraduate degree from an institution of higher learning and
is enrolled in:
(1) an accredited medical college; or
(2) an approved institution of higher learning for
purposes of obtaining a graduate degree in biomedicine or
life sciences.
"Guarantor." An insurance company or not-for-profit
guarantor whose primary purpose is to provide default coverage
and loss prevention services to an offeror of unsecured student
loans.
"Licensed health care facility." A health care facility that
is enrolled in the Commonwealth's medical assistance program and
is licensed under Article X of the act of June 13, 1967 (P.L.31,
No.21), known as the Public Welfare Code, or the act of July 19,
1979 (P.L.130, No.48), known as the Health Care Facilities Act.
"Nursing school applicant." An individual who is a resident
of this Commonwealth and is enrolled in an approved nursing
program.
"Offeror." An institution that makes unsecured loans to
eligible students in cooperation with the agency.
"Physician." An individual licensed to practice medicine and
surgery within the scope of the act of October 5, 1978
(P.L.1109, No.261), known as the Osteopathic Medical Practice
Act, or the act of December 20, 1985 (P.L.457, No.112), known as
the Medical Practice Act of 1985.
"Registered nurse." An individual licensed to practice
20260HB2269PN2968 - 3 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
professional nursing under the act of May 22, 1951 (P.L.317,
No.69), known as The Professional Nursing Law.
"Work requirement for nurses." Postgraduate, full-time
employment in direct patient care with a licensed health care
facility located in this Commonwealth in an occupation related
to an approved course of study. The term does not include a paid
student internship, a paid fellowship, volunteer service or
employment before graduation.
(b) Program.
Section 2211-A. Pennsylvania Medical Education Loan Assistance
Program.
The agency shall establish and administer the Pennsylvania
Medical Education Loan Assistance Program as set forth in
sections 2212-A and 2213-A to provide financial assistance to
individuals who acquire the required degree or diploma in
medicine, professional nursing, biomedicine or life sciences and
to recruit these individuals to practice their professions in
Pennsylvania.
Section 2212-A. Loan guarantor program.
(a) Establishment of program.--The agency shall administer a
loan guarantor program on a Statewide basis. The agency shall
utilize funds in the Medical School Loan Account to encourage
eligible applicants to attend an accredited medical college or
an approved institution of higher learning.
(b) Loan Guarantor Program.--The Loan Guarantor Program
shall provide for the following:
(1) Life of loan servicing.
(2) Contracting for insurance with a guarantor, approved
by the agency, which offers a low-cost loan with competitive
interest rates and loan fees to eligible applicants.
20260HB2269PN2968 - 4 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
(3) Predetermining the eligibility of applicants who
receive a loan from an offeror to attend an accredited
medical school or an approved institution of higher learning
that is insured by a guarantor.
(4) Evaluating the benefit package of a guarantor for
adequacy, accessibility and availability of funds necessary
to provide adequate loss prevention.
(c) Low-cost loans.--An eligible applicant shall apply to an
offeror for a low-cost loan to attend an accredited medical
college or an approved institution of higher learning. A low-
cost loan made under this subsection shall be guaranteed by an
approved guarantor through a contract with the agency. Low-cost
loans made under this subsection shall provide reduced interest
rates and loan fees to eligible applicants compared to loans
made for the same purpose that are not guaranteed by this
article.
(d) Loan requirements.--Loans provided under this section
shall cover up to 100% of the actual cost of tuition, room and
board at an accredited medical college or an approved
institution of higher learning and the actual cost of course-
required textbooks and supplies for the recipient.
(e) Default.--If a recipient fails to repay a loan received
under this section, the agency shall collect the loan pursuant
to one of the following:
(1) Section 4.3 of the act of August 7, 1963 (P.L.549,
No.290), referred to as the Pennsylvania Higher Education
Assistance Agency Act.
(2) A process established by the applicable guarantors.
(3) Any other collection procedure or process deemed
appropriate by the agency.
20260HB2269PN2968 - 5 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
(f) Medical Education Loan Loss Account.--An account is
hereby established within the agency to receive funds
appropriated for purposes of this section. Moneys in the account
are hereby appropriated to the agency to provide the loan
guarantor program. When funds in the account are expended, no
additional loans shall be offered.
(g) Interest rate reduction.--The agency or an offeror may
modify loans under this section to further reduce interest rates
as follows:
(1) The agency or the offeror may reduce the interest
rate of the loan by not less than 1% if the loan recipient,
upon completion of a graduate degree in biomedicine or life
sciences or upon licensure as a physician, agrees to practice
medicine or be employed to conduct research on a full-time
basis in Pennsylvania for a period of three consecutive
years.
(2) The agency or the offeror may reduce the interest
rate of the loan by not less than 2% if the loan recipient,
upon licensure as a physician, agrees to practice medicine
for not less than three consecutive years in a designated
area.
(h) Contract.--In addition to the requirements of subsection
(g), in order to be eligible for an interest rate reduction, a
loan recipient shall enter into a contract with the agency or an
offeror or its assigns at the time the loan is made. The
contract shall include the following:
(1) The loan recipient practicing in a designated area
shall agree to treat patients eligible for medical assistance
and Medicare.
(2) The loan recipient shall permit the agency or the
20260HB2269PN2968 - 6 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
offeror to monitor the recipient's practice or employment to
determine compliance with the terms of the contract and this
article.
(3) The agency shall certify compliance with the terms
of the contract.
(4) Upon the loan recipient's death or total or
permanent disability, the agency or the offeror shall nullify
the service obligation of the recipient.
(5) If the loan recipient is convicted of or pleads
guilty or no contest to a felony or if the licensing board
has determined that the recipient has committed an act of
gross negligence in the performance of service obligations or
has suspended or revoked the license to practice, the agency
or the offeror shall terminate the loan recipient's
participation in the program and seek repayment of the amount
of the loan on the date of the conviction, determination,
suspension or revocation.
(6) A loan recipient who fails to comply with a contract
shall pay to the agency or the offeror the amount of loan
received under the original contract as of the time of
default. Providing false information or misrepresentation on
an application or verification of service shall constitute
default.
(i) Accountability.--In July 2004, the agency shall conduct
a performance review of the program and services provided. The
performance review shall include the following:
(1) The goals and objectives of the program.
(2) A determination of whether the goals and objectives
were achieved by the agency-participating guarantor and
offeror.
20260HB2269PN2968 - 7 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
(3) The specific methodology used to evaluate the
results.
(4) Recommendations for improvement.
Section 2213-A. Loan forgiveness program.
(a) Establishment of program.--The agency shall administer a
loan forgiveness program for nursing school applicants on a
Statewide basis. The agency may provide loan forgiveness as
provided in subsection (b) for recipients of loans who by
contract with the agency agree to practice professional nursing
in this Commonwealth upon attainment of the required license.
(b) Loan forgiveness.--Agency-administered, federally
insured student loans for higher education provided to a nursing
school applicant may be forgiven by the agency as follows:
(1) The agency may forgive 50% of the loan, not to
exceed $50,000, if a loan recipient enters into a contract
with the agency that requires the recipient upon successful
completion of an approved nursing program and licensure as a
registered nurse to practice nursing in this Commonwealth for
a period of not less than three consecutive years.
(2) Loan forgiveness awards made pursuant to paragraph
(1) shall be forgiven over a period of three years at an
annual rate of 33 1/3% of the award and shall be made from
funds appropriated for this purpose.
(3) The contract entered into with the agency pursuant
to paragraph (1) shall be considered a contract with the
Commonwealth and shall include the following terms:
(i) An unlicensed recipient shall apply for a
registered nurse's license to practice in this
Commonwealth at the earliest practicable opportunity upon
successfully completing a degree in nursing.
20260HB2269PN2968 - 8 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
(ii) Within six months after licensure, a recipient
shall engage in the practice of nursing in this
Commonwealth according to the terms of the loan
forgiveness award.
(iii) The recipient shall agree to practice in a
licensed health care facility in the provision of direct
patient care on a full-time basis.
(iv) The recipient shall permit the agency to
determine compliance with the work requirement for nurses
and all other terms of the contract.
(v) Upon the recipient's death or total or permanent
disability, the agency shall nullify the service
obligation of the recipient.
(vi) If the recipient is convicted of or pleads
guilty or no contest to a felony or if the licensing
board has determined that the recipient has committed an
act of gross negligence in the performance of service
obligations or has suspended or revoked the license to
practice, the agency shall have the authority to
terminate the recipient's service in the program and
demand repayment of the amount of the loan as of the date
of the conviction, determination, suspension or
revocation.
(vii) Loan recipients who fail to begin or complete
the obligations contracted for shall pay to the agency
the amount of the loan received under the terms of the
contract pursuant to this section. Providing false
information or misrepresentation on an application or
verification of service shall be deemed a default.
Determination as to the time of default shall be made by
20260HB2269PN2968 - 9 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
the agency.
(4) Notwithstanding 42 Pa.C.S. § 8127 (relating to
personal earnings exempt from process), the agency may seek
garnishment of wages in order to collect the amount of the
loan following default under paragraph (3)(vii).
Section 2214-A. Tax applicability.
Loan forgiveness repayments received by a student shall not
be considered taxable income for purposes of Article III of the
act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code
of 1971.
(c) Miscellaneous Provisions.
Section 2231-A. Annual report.
(a) Development of report.--The agency shall publish a
report by September 1, 2002, and every year thereafter for the
immediately preceding fiscal year. The report shall include
information regarding the operation of the programs established
under this article, including:
(1) The number and amount of loan guarantees and loan
contracts executed and renewed for eligible applicants in
medicine, biomedicine or life sciences and the nursing loan
forgiveness program.
(2) The number and amount of nursing loan forgiveness
contracts executed and renewed for nursing school applicants.
(3) The number of defaulted nursing loan forgiveness
contracts, reported by cause.
(4) The number of nurses participating in the nursing
loan forgiveness program, reported by type of institution
attended, including four-year educational institutions,
community colleges, independent two-year colleges, private
licensed schools, hospital-based courses of study and
20260HB2269PN2968 - 10 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
certificate programs.
(5) The number and type of enforcement actions taken by
the agency.
(b) Submission.--The annual report shall be submitted to the
Governor, the chair and minority chair of the Appropriations
Committee of the Senate, the chair and minority chair of the
Appropriations Committee of the House of Representatives, the
chair and minority chair of the Education Committee of the
Senate, the chair and minority chair of the Education Committee
of the House of Representatives, the chair and minority chair of
the Public Health and Welfare Committee of the Senate and the
chair and minority chair of the Health and Human Services
Committee of the House of Representatives.
Section 2232-A. Appeals.
The provisions of this article shall be subject to 22 Pa.
Code Ch. 121 (relating to student financial aid).
Section 2233-A. Regulations.
The agency shall adopt regulations and procedures necessary
to carry out the purposes of this article.
Section 2234-A. Funding.
Loan guarantor program payments and loan forgiveness
repayments shall be made only to the extent that funds are
appropriated for that purpose and are sufficient to cover
administration of the programs. The receipt of a loan under this
article shall not constitute an entitlement derived from the
Commonwealth or a claim on any funds of the Commonwealth.]
Section 2. This act shall take effect immediately.
20260HB2269PN2968 - 11 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27