Guidelines for the Minnesota Dentist Loan Forgiveness Program

Program Purpose

The purpose of Minnesota’s Loan Forgiveness program is to recruit and retain health care professionals to needed areas and facilities within Minnesota. Loan forgiveness is an important benefit for health care professionals as well as health care facilities and communities experiencing a shortage of access to primary health care services.

Program Administration and Funding

The Office of Rural Health and Primary Care (ORHPC), Minnesota Department of Health administers this program. It is funded by the State of Minnesota. Program eligibility requirements and benefits are established by state statute, 144.1501 authorizing the health professional education loan forgiveness program.

Participant Eligibility and Application

This program is offered to dental students, residents or licensed dentists, who plan to practice for at least 30 hours per week, for at least 45 weeks per year, for a minimum of three years serving at least 25 percent of their annual patient encounters to state public program enrollees or patients receiving a sliding fee schedule in Minnesota.

To be eligible, a prospective participant must submit an application to the Office of Rural Health and Primary Care during the application cycle (July 1-December 1) while completing dental school or residency training. Licensed dentists with remaining educational debt that are currently serving at least 25 percent of their annual patient encounters to state public program enrollees or patients receiving a sliding fee schedule in Minnesota may also apply.

Loan Eligibility

The Dentist Loan Forgiveness Program provides funds for repayment of qualifying educational loans for dental students, residents or licensed dentists. Applicants are responsible for securing their own educational loans. Qualified loans include government, commercial and foundation loans for actual costs paid for tuition, reasonable education and living expenses related to the graduate or undergraduate education of a health care professional.

Selection

This is a competitive selection process. Selections are made based on suitability for practice as indicated by experience or training as noted on an application, as well as preference given to those closest to completing their training. The number of applicants ORHPC may select for participation per year varies and is contingent upon state funding.

Service Obligation and Funding

Participants must begin their service obligation under this program no later than March 31 following completion of their dental program. Participants must complete their dental program as originally stated in their application. Participants are required to practice as a dentist serving at least 25 percent of their annual patient encounters to state public program enrollees or patients receiving a sliding fee schedule for at least 30 hours per week, for at least 45 weeks per year, for a minimum of three years.

Participants are eligible to participate for up to four years of loan forgiveness during which they practice as a dentist serving at least 25 percent of their annual patient encounters to state public program enrollees or patients receiving a sliding fee schedule. The ORHPC will make an annual payment to the participant in the amount of $25,000, not to exceed $100,000 total for the maximum four-year period or the balance of the designated loan(s), whichever is less.

Annual Reporting

Annually, the ORHPC will request participants to verify their employment and document that they have applied the loan forgiveness funds to their designated educational loan(s). This information will be verified prior to each annual disbursement. It is the decision of the participant to pay their loan servicer(s) with a lump sum payment, or make monthly payments that total the annual disbursement.

Income Tax Reporting

Payments made to participants under the loan forgiveness program may be considered taxable income. The State of Minnesota will issue a 1099 form. It is the participant’s responsibility to determine how to report figures appropriately on their state and federal tax returns. Neither the ORHPC nor the participant is permitted to withhold any part of the annual loan forgiveness disbursement to pay any potential state or federal taxes.

Temporary Suspension of Service

Service obligations may be suspended as a result of an illness, disability or temporary job transfer lasting less than a total of 12 months during the four-year commitment. All requests for temporary suspension of service must be in writing and substantiated by documentation acceptable by the state on a case by case basis. The agreement end date will be extended by the amount of time a participant is in suspension status.

Penalty for Non-fulfillment

If a participant does not fulfill the minimum obligation of three years serving at least 25 percent of their annual patient encounters to state public program enrollees or patients receiving a sliding fee schedule in Minnesota, the participant will be required to repay the total amount ORHPC paid plus interest, at a rate established according to Minnesota Statutes 270C.40.