RAP Plan for Medical Students 2026: What to Know

If you start medical school in fall of 2026, you are entering a completely different world of student loans. The SAVE plan is gone and PAYE is on the way out and a new plan called RAP, Repayment Assistance Plan, is the default for anyone who makes their first payment on or after July 1, 2026. That is you. Before you sign your promissory note master you need to understand how RAP works and compare it to IBR and make smart moves now to save tens of thousands during your career. What's RAP and Where Did It Come From? The Repayment Assistance Plan (RAP) came from the One Big Beautiful Act that was signed into law in 2025. It began July 1, 2026 and covers all Direct Federal loans issued after that date. So if you start medical school in August 2026, your first loan payments will be subject to RAP rules automatically. RAP does not apply to people who have loans that were issued before July 2026. These people remain on whichever plan they currently use such as IBR or PAYE. How RAP Works: Payments and Forgiveness Payments: RAP sets monthly payments at roughly 10 percent of Adjusted Gross Income after subtracting 150 percent of federal poverty level. This is similar to IBR for many borrowers but IBR has a hard cap that prevents payments from exceeding the standard 10 years while RAP does not. Take a resident making $70,000 per year for example: Poverty level at 150 percent is around $22,590 for singles in 2026. Remaining discretionary income after that is $47,410. Monthly RAP payment works out to roughly $395 a month. This is close to what residents pay under IBR roughly speaking. For most medical trainees actual monthly RAP payment will be similar to IBR. Big difference: forgiveness. Under IBR forgiveness after 20 years (for loans taken out after July 1, 2014) or 25 years (for previous loans). For RAP this forgiveness happens after 30 years. This five to ten years difference for doctors who do not use Public Service Loan Forgiveness (PSLF) is huge. Doctors on a long repayment path get forgiveness at year 20 under IBR; under RAP they pay off loans for an extra ten years before forgiveness. RAP vs. IBR: What MS1s Need to Know If you are aiming for PSLF, IBR and RAP are essentially the same. For forgiveness PSLF, you get forgiveness after 120 qualifying payments regardless of which IDR plan you use. But if you are not going for PSLF, the 20 year window for forgiveness provided by IBR is much better than the 30 years for RAP. New borrowers now can no longer use IBR; it is closed July 1, 2026. So the main question is how can you best position yourself for PSLF if you are planning to borrow new loans now? PSLF Under RAP: No Changes Here PSLF still operates just the same for RAP as well: you need: 120 qualifying monthly payments (that is 10 years worth). Payments while on qualifying IDR plan (RAP qualifies). Full time employment at a qualifying employer for nonprofits and government. For students starting residency in 2026, their medical loans are under PSLF while in residency. Payments during residency count toward PSLF. After residency and if working with a qualifying employer both during residency and as attending physician, total 10 years of qualifying payments are needed. After making 10 qualifying payments from first qualifying one, loans are forgiven tax free. Strategy for new MS1 students has not changed: they use RAP payments rather than IBR. Strateg ic Decisions to Make Before MS1 Year Starts 1. Understand your total projected debt. The average medical school debt at graduation is now ~$202,000 (AAMC 2024). But that's just the starting balance. At 7%+ interest over four years of medical school, your balance at graduation will be higher: Year 1 loan: $55,000 → grows to ~$72,000 by graduation (7% × 4 years) Year 2 loan: $55,000 → grows to ~$67,000 Year 3 loan: $55,000 → grows to ~$62,000 Year 4 loan: $55,000 → stays at ~$55,000 Total graduated balance on $220,000 borrowed: approximately $256,000. Then residency adds more interest. Your final attending-start balance will likely be $275,000–$320,000. 2. Borrow only what you actually need. This sounds obvious but isn't. The financial aid office offers maximums — you don't have to take the maximum. Every $10,000 you don't borrow in year 1 saves you ~$30,000+ in interest and payments over a career. Use scholarship money aggressively. Apply for every NHSC, military HPSP, and institutional scholarship available. Every dollar not borrowed is better than any repayment strategy. 3. Identify your likely career setting in year 1. Your specialty and practice setting determine your optimal repayment strategy — and that strategy should guide decisions you make in medical school: Academic medicine or hospital-employed → PSLF is likely in your future → stay on RAP, certify employment from day 1 of residency Private practice or procedure-heavy specialty → PSLF less likely → aggressive payoff on attending salary is the plan → borrow minimally and watch the balance 4. Sign up for RAP immediately at residency match. When you match into residency, log into studentaid.gov and enroll in RAP (or whatever the current qualifying IDR plan is at that time). Don't wait — every month of standard repayment on a $280,000 balance costs you ~$3,200/month you almost certainly can't afford on a resident salary. 5. Submit an Employment Certification Form from day 1 of internship. If your residency program is at a nonprofit or government hospital (which most are), submit an ECF on your first day of work. The clock starts on your qualifying payments immediately. Don't wait until year 3 of residency to figure out if your program qualifies. The RAP Interest Subsidy: A Small But Real Benefit One feature RAP has that IBR doesn't: if your RAP payment is less than $50/month, the Department of Education covers the difference between your payment and any interest that would otherwise accrue — up to a $50/month cap. In practice, this matters mainly for borrowers in very low-income periods. For a medical student on internship with a $65,000 salary, RAP payments are already ~$370/month — above the $50 subsidy threshold. So this benefit doesn't apply during residency for most physicians. It's more relevant for borrowers in financial hardship who have near-zero payments. What About Medical School Scholarships in 2026? The most underused tool for medical students isn't a repayment plan — it's reducing the debt before it accrues. NHSC Scholarship Program: Covers full tuition + fees + living stipend in exchange for 2 years of service at an NHSC-approved site (rural/underserved community). Extremely competitive but life-changing financially. See our NHSC loan repayment guide. Military HPSP: Army, Navy, Air Force all sponsor medical education in exchange for 4 years of active duty service as a physician. Full tuition + monthly stipend covered. If military service interests you, this eliminates debt entirely. Institutional scholarships: Many medical schools offer merit and need-based scholarships that don't get the same attention as NHSC or HPSP. Apply broadly — institutional aid can reduce your debt by $20,000–$80,000. Common MS1 Mistakes With Student Loans Borrowing the maximum offered without a budget. The loan maximum isn't your target — it's a ceiling. Create a monthly budget for your medical school years and borrow only what that budget requires. Not understanding the interest capitalization at graduation. Interest accrued during medical school capitalizes (gets added to the principal) when you enter repayment. That's not just interest — it then earns interest itself. Understand the math before borrowing. Assuming the current rules will remain constant. The last 5 years have seen SAVE created and vacated, PAYE phased out, and RAP introduced. The rules will change again. Build your strategy around plans likely to persist (federal statute-based programs like IBR and PSLF) rather than regulatory creations like SAVE that can be vacated. Not certifying PSLF employment from residency day one. If you plan to pursue PSLF, the 10-year clock starts the moment you make your first qualifying payment at a qualifying employer. That's day 1 of intern year at most hospital programs. FAQ What is the RAP plan for medical students? RAP (Repayment Assistance Plan) is a new federal income-driven repayment plan effective July 1, 2026, applying to loans first disbursed on or after that date. Payments are approximately 10% of discretionary income, and loan forgiveness occurs after 30 years — longer than IBR's 20–25 year timeline. RAP qualifies for PSLF. Is RAP better or worse than IBR? For physicians pursuing PSLF, RAP and IBR are equivalent — both qualify for PSLF forgiveness at 10 years. For physicians not pursuing PSLF, IBR is better because it offers forgiveness at 20–25 years vs. RAP's 30 years. Since new MS1s take loans under RAP, PSLF positioning becomes more important. Can medical students starting in 2026 choose IBR instead of RAP? No — IBR is closed to new borrowers after July 1, 2026. Students whose first loan disbursement is on or after that date are limited to RAP (plus the option of standard, extended, or graduated repayment). PSLF works the same under RAP. How much will a medical student pay under RAP during residency? Depends on income. A resident earning $70,000/year would pay approximately $370–$420/month under RAP — similar to IBR payments at the same income level. RAP payments during residency count toward PSLF's 120 qualifying payments. Should I try to avoid the RAP plan as an MS1? You can't avoid it — RAP applies to all new loans from July 2026 forward. But you can minimize its impact by: (1) borrowing as little as possible, (2) pursuing PSLF to sidestep the 30-year forgiveness disadvantage, and (3) considering scholarships that eliminate borrowing entirely. --- Run Your Own Numbers Every physician's debt situation is different. Use the MedDebt Calculator to model your exact repayment strategy — PSLF vs. aggressive payoff vs. refinancing — with your actual loan balance, specialty, and income. It's free, takes 2 minutes, and shows you net worth projections by year.

This article is for informational purposes only and does not constitute financial, legal, or tax advice. Every borrower's situation is unique — consult a certified student loan advisor or fee-only financial planner before making repayment decisions.

Disclosure: This article is for informational purposes only and does not constitute financial, legal, or tax advice. Loan program details change — always verify current rules on studentaid.gov. MedDebt may earn a referral commission if you refinance through links on this site.