Physician Student Loan Defense

Often, because of circumstances beyond his or her control, a physician will find himself unable to repay student loans from college or medical school. This can become an extremely serious matter because:

1. Student loans are not dischargeable in bankruptcy court.
2. Defaulting on student loans is grounds for an emergency suspension of a health care professional’s license.
3. Defaulting on student loans is grounds for revocation or other discipline against a professional’s license.
4. The U.S. Attorney’s office is making a concerted effort to collect on defaulted student loans.
5. A civil lawsuit can be filed against you in federal court by the U.S. Attorney’s Office and you will be required to add attorney’s fees, interest, penalties and court costs to the amount you already owe.
6. Defaulting on student loans will result in exclusion from the Medicare and Medicaid Programs by the U.S. Department of Health and Human Services (HHS) Office of the Inspector General (OIG). If this occurs, no individual or organization which participates in Medicare or Medicaid, or any other federal health care program (CHAMPUS, TRICARE, Railroad Retirement System, Bureau of Indian Affairs, etc.) is allowed to employ you or to contract with you or with any other individual or organization which employs you or contracts with you. This will have the effect of eliminating 98% of your possible employment opportunities.
7. Exclusion by the HHS OIG will automatically cause you to be placed on the U.S. General Services Administration’s (GSA’s) debarment list (list of individuals who are excluded from contracting with the federal government. . If this occurs, no individual or organization which contracts with the federal government is allowed to employ you or to contract with you or with any other individual or organization which employs you or contracts with you.
8. You may find yourself the subject of television shows and other media reports that target individuals in high paying professions who are in default on student loans.
   You should take every opportunity available to avoid going into default on student loans. We work with physicians and other health professionals in obtaining deferments or forgiveness on student loans. Often there are hardship grounds available for this. If the case has been referred to the U.S. Attorney’s Office for a suit to be filed in federal court, we are available to defend you in federal court.

We work with physicians and other health care professionals in making repayment plans and resolving default situations. It is never too late to resolve the situation. Even if you are already in default, already excluded by the OIG, already on the federal government’s default list, it is possible to remedy the situation. We have been successful in obtaining stays of exclusions and in having exclusions lifted.

There are those unscrupulous individuals out there who will tell you they can negotiate settlements of the amounts you owe for pennies on the dollar. These are liars. It is extremely rare that the U.S. will accept a lump sum payment of less than seventy percent (70%) to eighty-five percent (85%) of the total amount you owe. If someone tells you something different: 1) request the promise in writing on their letterhead and signed; and 2) make them agree, in writing, that there will be no charge to you if they fail to do so. See what happens then.

When a client does not have enough money to make a lump sum payment, we have been successful in negotiating repayment plans with the government. Repayment plans can be negotiated based on your financial situation. If you only have a low paying job and few assets, the government will agree to accept lower monthly payments. However, if you have a high paying job or a lot of liquid assets, the government will expect you to pay more each month. You will be required to produce financial documents and releases to the government to show your true financial condition and ability (or lack of ability) to make monthly payments. The government will conduct a background investigation and asset search on you and will find d hidden assets, and it is very good at this.

You cannot attempt to hide assets or lie on financial disclosure forms. Making a false statement of any kind on any form or report made to the U.S. government is a federal criminal offense, even if it is not under oath.

Because of our experience in working with physicians and other health care professionals, our experience in working with state and federal administrative agencies, and our experience in litigation, we have a great deal of credibility in resolving matters of this nature. Additionally, we are often able to do so while protecting your license. Think twice before hiring anyone who is not familiar with all of the issues and all of the possible repercussions you could face in the future regarding such matters.