The Biden administration has introduced new guidelines for the Total and Permanent Disability (TPD) discharge program, aimed at helping borrowers with disabling medical conditions achieve student loan forgiveness. The recent updates to the program coincide with a revised discharge application and expanded regulations that allow a wider range of medical providers to certify a borrower’s eligibility for loan forgiveness.
Under the TPD Discharge program, borrowers must demonstrate an inability to engage in substantial, gainful activity due to a physical or psychological condition that has persisted or is expected to continue for five years, or is terminal. The program offers three pathways for borrowers to qualify for loan forgiveness, including certification by the Veterans Administration, receiving Social Security disability benefits under certain circumstances, or having a medical provider certify their eligibility.
The new guidance issued by the Education Department is specifically for medical providers certifying a borrower’s eligibility for loan forgiveness under the TPD program. The guidance clarifies key elements of the program, outlines common mistakes to avoid on the application, and provides insight into the review process for medical providers completing the certification for the first time in their careers.
The department’s guidance emphasizes that borrowers who work and earn income can still qualify for TPD discharge as long as they are not engaged in substantial gainful activity. Providers are instructed on how to properly complete the certification form, including providing detailed information on their credentials and the borrower’s medical conditions. Failure to complete the form accurately could result in rejection of the application.
The Biden administration’s reforms to the TPD discharge program have resulted in over $14 billion in student loan forgiveness for more than 548,000 borrowers. The changes also include the elimination of post-discharge income monitoring requirements, making it easier for borrowers receiving Social Security disability benefits to qualify for loan forgiveness.
In addition to the TPD discharge program, President Biden’s “Plan B” student loan forgiveness initiative could provide further relief for borrowers, including those with disabilities. The program, slated to launch this fall, aims to offer forgiveness to borrowers who qualify for existing loan forgiveness programs but have not applied or are facing financial hardship due to medical conditions and associated expenses. Draft regulations for the program are currently open for public comment.
Overall, the Biden administration’s efforts to reform student loan forgiveness programs, particularly for borrowers with disabilities, are providing much-needed relief to hundreds of thousands of individuals struggling with student debt. The expansion of eligibility criteria, simplified application processes, and the introduction of new forgiveness initiatives are helping borrowers achieve financial stability and relief from the burden of student loans.
