| | Educational Loan Forgiveness
Sometimes, hospitals, groups or other employers may agree to pay off a physician's medical education loans as part of the contract. With many new physicians $100,000 or more in debt, this can be a very important incentive. Debt that might burden a physician for years can be eliminated in a much quicker timeframe. The quid pro quo is that the physician must agree to practice in the community for a certain length of time. The employer might agree to pay the physician's educational debt on a prorated basis over two or three years. A physician $100,000 in debt therefore would have about $33,000 paid off by the hospital in exchange for a commitment to stay in the community three years. It's important, however, to ensure that the stipulated amount is paid at the end of each year, not at the end of the three year period. If, for professional or personal reasons, the physician wants or needs to leave the community before three years, he or she should be paid for their time in the community. For example, if the physician leaves after one year, one-third of his loans should be paid off.
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