Exactly How IHS Student Loan Repayment works

[WestTXisGr8]

I looked and looked for specific information regarding the IHS loan repayment and couldn't find the specifics of what I was looking for. So after being in the program 1 year, I thought I would post EXACTLY what to expect for anyone else interested.

So, for the 1st contract, it is a 2-year contract. You need to be aware that there are serious penalties for not completing a contract. I read through all the paperwork and the IHS has a calculation in there of what you would be charged for not completing a contract. (The reason for not completing the contract is inconsequential, unless the reason is that you died). But basically, there is a penalty of approximately 3 times what you received, for not completing a contract. And that could be for any reason - you quit, were fired, replaced by a Native American, etc. This is in their online documentation. There is a formula they post as to how they figure the penalty. But it is a very large penalty. So have a back-up plan. For instance, I know if I am were to ever be fired or replaced, I will immediately notify the IHS repayment center, and immediately get another job ANYWHERE I HAD TO with the IHS to complete my contract. You must get approval from the IHS repayment center BEFORE starting your new job.

Secondly to keep in mind, they require you have no more than 35 days off in a contract year (from the date your contract starts). This includes annual time (vacation), personal time, time off for training (even if it is work required training - anything that takes you away from your "clinical job"), sick time, time off your work for any reason other than holidays. And once a year your HR/personnel, supervisor, and time sheet tracker (so 3 people) must sign a form stating you have worked 40 hours a week for the past 12 months and had 35 or fewer days off in that time frame.

Here is exactly how this is written in the form that needs to be signed by the 3 individuals at your work: "I certify that the above named individual was away from their designated duty station for a total of ____ days during the contract obligation period. This includes but is not limited to: annual leave; sick leave; comp-time/credit hours used; maternity leave; court/jury duty; deployment; training and education; or Family Medical Leave. (*Do not include holidays)."

Also their program states "You must request a suspension of your service commitment if you anticipate an absence from full-time clinical practice longer than the approved 35 workdays. Suspensions are reviewed for medical reasons (including maternity leave), military deployment and urgent personal matters only." So keep in mind you must get approval FIRST, and then your contract will be extended by the amount of time they approve.

So for instance, I have 20 days a year of vacation time and 4 days a year of personal time, so I can take no more than 11 days off a year for ANY OTHER REASON (including sick time, comp-time, etc etc). It is imperative to know this up front!!

Next, in the IHS LRP paperwork (or website) it says something like they only review you for repayment on sites that score a 19 or higher. My site is scored a 13. I applied anyway. I was approved pretty immediately after applying. So that 19 or higher is based on the # of applicants vs the amount of money available. So apply no matter what your site score is.

Also, once you have received approval and had a contract, you are first in line (in front of any new requests) to be funded for future contracts (as long as you reapply). So definitely reapply in time. You need to reapply PRIOR to January of the year you want funding. So for my first contract (which is 2 years, 1st year funding May 1, 2023-April 30, 2024, 2nd year funding May 1, 2024-April 30, 2025) I will re-apply around October-Nov 2024 for the cycle of May 1, 2025-April 30, 2026.

So here is how the funding (money) works: I received approval May 1, 2023 for my first contract (first contract is 2 years, after that it is 1 year for every renewal contract). I signed the contract in April and they signed it May 1st. I received the first $25,000 (for the 1st year) in September 2023. I am responsible for paying my loan payments until the money is received, but then can count that money to any payments I paid starting May 1st. On or before April 30, 2024 I have to submit to them the printout from my loan company showing I paid $25,000 towards my loan in that contract year (from 5/1/23-4/30/24).

Here is what I received from IHS and how it applies to my income taxes:
The deposit I received in September 2023 was for $22,628.50. The W2 I received in January 2024 is as follows: Lines 1,3,& 5 for Wages received amount is: $31,000.00 (this is the amount I will pay taxes on). Line 2 Federal income tax withheld was $6,000.00. Line 4 Social Security Tax Withheld was $1,922.00. Line 6 Medicare Tax withheld was $449.50. No state taxes were withheld (I currently live in a state with state income tax).

So even though the deposit was for $22,628.50 I do need to pay the full contract amount of $25,000 towards my student loans within that contract year. If my income is above the SS threshold, I will receive back the amount they paid towards social security in my taxes (refund from IRS). However, I will possibly owe a little more MC taxes, and I will owe state income taxes. And receiving this loan money from IHS increases my income amount by $31,000 (above what my income from working is). This is treated just like I worked another job and made $31,000 at that other job. Obviously all the tax amount shown on my W2 (from IHS LRP) were paid directly to the IRS, just like it would be at my job.

I hope this helps people more understand this program. Here are some side notes related to how this works alongside Public Service Loan Forgiveness. So for the PSLF I have to be in an income-driven repayment program that is approved for PSLF (not all repayment options are approved for PSLF). Currently I am in the SAVE repayment plan. (SAVE is the acronym for the program). Each year I have to re-certify my income. Each person has a different re-certify date depending on the date you first enter the program. My date is December each year. I re-certify by giving them one-time access to my IRS filings (giving them permission to access the IRS on my behalf). So my payment is adjusted based on my "Adjusted Gross Income" (Line 11 of the 1040). So receiving the IHS LRP money increases that amount, and increases my payment up accordingly. I do not have my student loans set to auto-deduct monthly. If you do have them set for that, and you pay a lump sum towards your student loans, it does not change the next date they auto-deduct a payment.

For the past year my student loan payment has been right at $1,300/mo. So I'm only paying $15,600/year in student loans. However, I MUST pay $25,000/year. So before my contract year was up, I had to pay an additional $9,400 towards my student loan. If they are set up to auto-deduct, they will still take the $1,300 out of my checking account every month even after I pay a one-time payment of $9,400. However, by removing it from auto-deduct, I lose the small amount of % they reduce my student loan interest by (0.25% I think). But then when I pay a large payment it rolls forward my student loan. So right now, after paying the $25,000 total for the last contract year, my payment is not due again until January 2025. This gives me a buffer so I don't have to pay my next payment until I receive the next money from IHS (will receive it sometime between now and the end of September).

What it also does for me, is when my payment increases in December (because of the added money from IHS on my income), I will have plenty of money to pay that increase. If I read their info correctly, when they re-certify my payment in December, that starts a new cycle, so if my payment goes up, it might actually reset that my payment is paid ahead. Additionally, I keep my money in a SOFI savings account which currently pays me 4.6% interest per year. So that interest more than compensates for any amount I am losing with not having my payments auto-deducted.

Additionally, when I hit my 10 years and my student loans are forgiven under the PSLF, they are forgiven tax-free. I do not owe taxes on the amount forgiven. So I don't care that I am accruing a little more interest by not having my payments auto-deducted.

I hope this thoroughly explains this and gives some information that I have not been able to find elsewhere, but wish I had known ahead of time.

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[Caverject]

Is what you described for commissioned Officers or GS employees? I thought my path to loan repayment as an Officer with the Army was arduous and bureaucratic, but the Army has nothing on the public health service!

 

[WestTXisGr8]

This is not for commissioned officers. I am a civilian working at an IHS facility.

 

[Caverject]

This is not for commissioned officers. I am a civilian working at an IHS facility.

God bless you and hopefully you never get sick. I lost a pharmacist once for 8 months due to cancer. I wouldn't be able to stomach the idea of saying "too bad, so sad" for not meeting the 35 day requirement.

Thank you for sharing your experience!

 

[GrandTheftAutumn]

I have 0 interest in doing IHS, but out of curiosity
1) do they pay for private student loans or just federal?
2) is 25k the set amount? i.e whether you owe 300k or 50k, the amount you get is the same?
3) 31k was your paycheck for entire 2023?
4) what's the life like in the reservations?
5) I'd imagine it comes with a lot of sacrifices. Do you think it's all worth it for 25k in repayment?

This was an enjoyable read btw, keep up the great work there

 

[WorthlessOxygen]

Damn I'm a fed and thought I was pretty comfortable with bureaucratic procedures but this is a whole new level

 

[lord999]

I don’t think some of what you said is correct. Title 5 Civil Service doesn’t allow some of the contract breaks due to separation rules.

This I know is less severe than you make it:

The 35 day rule allows for suspension for humane or command reasons. That’s a Title 5 and Title 10 (military) requirement. It’s actually automatic for military or emergency duty situations where the six month calendar doesn’t apply (I’ve personally ordered IHS personnel to transfer under this rule). Title 10 assumes payment responsibility if orders cause a breakage of another Civil Service related contract provided that the person had truthfully notified their home agency of the service commitment.

I’ve never heard of a suspension denied for pregnancy, there’s horror stories in Professional Liability Insurance circles on supervisors who are martinet and then get immediately sent for AIB inquiry.

Question:
On the topic of the Native American rule, is that considered a termination for unsatisfactory performance? It’s always been handled as an administrative separation and on IHS to deal with. Where is the text for this for LRP?

Tribal Resolutions Excluding IHS Employees from Reservation Where Assigned | 1995

The Indian Health Service (IHS), an agency within the Department of Health and Human Services, is responsible for providing federal health services to American Indians and Alaska Natives. The provision of health services to members of federally-recognized Tribes grew out of the special...

www.ihs.gov

The only time I’m aware that it’s an issue is if the reservation bans you from their lands. The Navajo in AZ will do so for performance related reasons. But even in that case, IHS is required by Title 5 to effect a transfer unless you’re sent to an AIB tribunal.

 

[WestTXisGr8]

I have 0 interest in doing IHS, but out of curiosity
1) do they pay for private student loans or just federal?
2) is 25k the set amount? i.e whether you owe 300k or 50k, the amount you get is the same?
3) 31k was your paycheck for entire 2023?
4) what's the life like in the reservations?
5) I'd imagine it comes with a lot of sacrifices. Do you think it's all worth it for 25k in repayment?

This was an enjoyable read btw, keep up the great work there

1) I don't think it matters if your student loans are private or federal. They repay student loans.
2) $25K is the set amount annually no matter how much your student loans are. My student loan is right at $200k and this more than covers my payments. (Currently is about $10,000 more per year than my student loan payments. So it pays my student loan payment plus $10,000 extra to go towards interest & principal).
3) $31k is the W2 from IHS for the student loan repayment ONLY. I receive a second W2 from my actual work income, which is >$160,000.
4) I don't live on the reservation. So my life outside of work is rural, and typical (I enjoy rural living). I live in a regular small town (by choice). What is work life like on the reservation? The majority of my co-workers are awesome. We have a few who are not, but for the most part they are great. My work stress is MUCH different than when I worked at a retail pharmacy. My work load is much less, I have input in patient care (not just dispensing meds), I absolutely love my job. The stress comes from people above me who are "voted in by a popular vote" that make decisions when they have no business or medical experience, and no education in either area. But for the most part, regarding working in the clinic, if you do your job, and focus on patient care the rest can be, for the most part, mitigated. It isn't as bad as upper level management in a retail chain pharmacy working you to death and treating you like you are disposable. Plus our hours are 8am-4:30pm Monday-Friday. I never work weekends. I very very rarely ever work past 4:30pm.
5) I haven't made any sacrifices to work here, or to receive the student loan repayment. I make more money than I would retail or hospital (that may not be true for every IHS facility - I work directly for a Tribal-run IHS facility). I already love living rural. My house is large and beautiful and is a 10 minute drive to work. I don't work weekends or evening. I have 23 paid holidays a year (not a misprint) - but that is probably less at an IHS-run IHS facility. I am paid weekly. My health insurance is covered 100% and they cover 75% of my husband's health insurance. I receive a 4% match on my 401K. I get 160 vacation hours per year and 32 personal time hours per year. I receive 96 sick hours per year, which can be rolled over indefinitely so that if I am ever truly sick I could actually be out a couple of months (after working several years) and it be fully paid.

If you like rural living, it is definitely something to consider. Things that struck me working here that I didn't deal with previously: rules have to be strict and pretty much the same for everyone. For instance we do not dispense a controlled substance even a day early. All chronic controlled substances are a 28 day supply and we hold it to the day. I would have never been that strict in retail. Not long after starting my job at IHS, I had a patient call me and say they were going to a funeral and asked for their controlled substance a day early. I allowed that to happen. Within 5 minutes of dispensing I received a call that had 6 people on speaker phone at that patient's house wanting to know why I wouldn't give them their controlled substance early (they were not going to a funeral). So the fact that everyone is related, knows each other, tells each other everything, is something that caught me by surprise when I first started working there. Obviously I would not discuss that with any of them.

In a regular setting HIPAA is very important. In this setting it is imperative. I have to make absolutely sure if I have a discussion with a tech or one of our medical providers regarding a patient, that we are in a completely private setting with no patients anywhere around. Because even without saying a patient's name, someone eavesdropping at the window while they are picking up their med, can figure out who you might be referring to. Even if you are talking at the back of the pharmacy in a low voice (we are a very small pharmacy). In a retail setting you can have a discussion on the phone with a provider and not have to worry that a patient picking up their med would figure out who you are discussing (when no names are said out loud). Not in this setting. We have sound machines everywhere, and a pharmacy window that is glass and closes, so we can actually have 100% HIPAA compliance. Every time one of my techs is about to open the window to greet a patient, they announce that, so the rest of us in the pharmacy don't say anything regarding any other patients (to each other obviously, or to a provider that has come in to discuss a patient).

Hope this gives you a little insight. Feel free to ask me any questions.

 

[WestTXisGr8]

God bless you and hopefully you never get sick. I lost a pharmacist once for 8 months due to cancer. I wouldn't be able to stomach the idea of saying "too bad, so sad" for not meeting the 35 day requirement.

Thank you for sharing your experience!

Although I hope that never happens, they wouldn't say "too bad, so sad", they would actually extend my contract (or basically pause it for the 8 months that I am out). So a 1 year contract would turn into a 1 year and 8 month contract with the same $25,000 for that entire time. It wouldn't be great, but it wouldn't trigger a contract breach, it would just extend it.

 

[WestTXisGr8]

I don’t think some of what you said is correct. Title 5 Civil Service doesn’t allow some of the contract breaks due to separation rules.

This I know is less severe than you make it:

The 35 day rule allows for suspension for humane or command reasons. That’s a Title 5 and Title 10 (military) requirement. It’s actually automatic for military or emergency duty situations where the six month calendar doesn’t apply (I’ve personally ordered IHS personnel to transfer under this rule). Title 10 assumes payment responsibility if orders cause a breakage of another Civil Service related contract provided that the person had truthfully notified their home agency of the service commitment.

I’ve never heard of a suspension denied for pregnancy, there’s horror stories in Professional Liability Insurance circles on supervisors who are martinet and then get immediately sent for AIB inquiry.

Question:
On the topic of the Native American rule, is that considered a termination for unsatisfactory performance? It’s always been handled as an administrative separation and on IHS to deal with. Where is the text for this for LRP?

Tribal Resolutions Excluding IHS Employees from Reservation Where Assigned | 1995

The Indian Health Service (IHS), an agency within the Department of Health and Human Services, is responsible for providing federal health services to American Indians and Alaska Natives. The provision of health services to members of federally-recognized Tribes grew out of the special...

www.ihs.gov

The only time I’m aware that it’s an issue is if the reservation bans you from their lands. The Navajo in AZ will do so for performance related reasons. But even in that case, IHS is required by Title 5 to effect a transfer unless you’re sent to an AIB tribunal.

I'm not quite sure what you mean. I am not military. I am not Health Corp. I'm just a private individual, working for an Indian Tribe. The 35 day rule is not a suspension of my job. It would be "pause" of my student loan repayment contract. So if I were to go out on maternity leave for say 3 months, my student loan repayment contract would extend from 1 year to 1 year and 3 months. So the next time they would renew my contract and pay another $25,000 would be after 15 months instead of 12 months.

None of this is related to job termination. Except for the penalty you would incur from the LRP if you were terminated and did not go back to work at a different IHS facility. But I'm not sure what you mean by, "On the topic of the Native American rule, is that considered a termination for unsatisfactory performance?"

Also, to be excluded from a Tribal Reservation, I would have to be a felon or threatening people (at least at the Reservation where I am currently employed), either of which would cause job termination. And since I am not Native American, I wouldn't be on the Reservation if I were terminated.

Not sure that answered your questions?

 

[GrandTheftAutumn]

1) I don't think it matters if your student loans are private or federal. They repay student loans.
2) $25K is the set amount annually no matter how much your student loans are. My student loan is right at $200k and this more than covers my payments. (Currently is about $10,000 more per year than my student loan payments. So it pays my student loan payment plus $10,000 extra to go towards interest & principal).
3) $31k is the W2 from IHS for the student loan repayment ONLY. I receive a second W2 from my actual work income, which is >$160,000.
4) I don't live on the reservation. So my life outside of work is rural, and typical (I enjoy rural living). I live in a regular small town (by choice). What is work life like on the reservation? The majority of my co-workers are awesome. We have a few who are not, but for the most part they are great. My work stress is MUCH different than when I worked at a retail pharmacy. My work load is much less, I have input in patient care (not just dispensing meds), I absolutely love my job. The stress comes from people above me who are "voted in by a popular vote" that make decisions when they have no business or medical experience, and no education in either area. But for the most part, regarding working in the clinic, if you do your job, and focus on patient care the rest can be, for the most part, mitigated. It isn't as bad as upper level management in a retail chain pharmacy working you to death and treating you like you are disposable. Plus our hours are 8am-4:30pm Monday-Friday. I never work weekends. I very very rarely ever work past 4:30pm.
5) I haven't made any sacrifices to work here, or to receive the student loan repayment. I make more money than I would retail or hospital (that may not be true for every IHS facility - I work directly for a Tribal-run IHS facility). I already love living rural. My house is large and beautiful and is a 10 minute drive to work. I don't work weekends or evening. I have 23 paid holidays a year (not a misprint) - but that is probably less at an IHS-run IHS facility. I am paid weekly. My health insurance is covered 100% and they cover 75% of my husband's health insurance. I receive a 4% match on my 401K. I get 160 vacation hours per year and 32 personal time hours per year. I receive 96 sick hours per year, which can be rolled over indefinitely so that if I am ever truly sick I could actually be out a couple of months (after working several years) and it be fully paid.

If you like rural living, it is definitely something to consider. Things that struck me working here that I didn't deal with previously: rules have to be strict and pretty much the same for everyone. For instance we do not dispense a controlled substance even a day early. All chronic controlled substances are a 28 day supply and we hold it to the day. I would have never been that strict in retail. Not long after starting my job at IHS, I had a patient call me and say they were going to a funeral and asked for their controlled substance a day early. I allowed that to happen. Within 5 minutes of dispensing I received a call that had 6 people on speaker phone at that patient's house wanting to know why I wouldn't give them their controlled substance early (they were not going to a funeral). So the fact that everyone is related, knows each other, tells each other everything, is something that caught me by surprise when I first started working there. Obviously I would not discuss that with any of them.

In a regular setting HIPAA is very important. In this setting it is imperative. I have to make absolutely sure if I have a discussion with a tech or one of our medical providers regarding a patient, that we are in a completely private setting with no patients anywhere around. Because even without saying a patient's name, someone eavesdropping at the window while they are picking up their med, can figure out who you might be referring to. Even if you are talking at the back of the pharmacy in a low voice (we are a very small pharmacy). In a retail setting you can have a discussion on the phone with a provider and not have to worry that a patient picking up their med would figure out who you are discussing (when no names are said out loud). Not in this setting. We have sound machines everywhere, and a pharmacy window that is glass and closes, so we can actually have 100% HIPAA compliance. Every time one of my techs is about to open the window to greet a patient, they announce that, so the rest of us in the pharmacy don't say anything regarding any other patients (to each other obviously, or to a provider that has come in to discuss a patient).

Hope this gives you a little insight. Feel free to ask me any questions.

Thanks for answering the questions. That sounds incredible, I'm glad you're enjoying your work and that's a great pay + benefits.
I'm more of a fan of the big cities and still at an age where I'd pay up to live the metropolitan life.
But sounds like a win-win if you like the rural lifestyle.
I wish more pharmacists would find these kinds of work rather than being stuck at the corner or three letter.