A future nurse with $120K in loans. A respiratory therapy student just one semester from graduating who is forced to drop out after maxing out federal aid. A hospital stalled in hiring because an ICU nurse can’t afford to pursue a CRNA degree.

These aren’t isolated incidents, they’re clear symptoms of a healthcare workforce crisis that’s worsening. Since 1980, the cost of education has soared by 170% while average earnings have increased by only 19%, leaving students deeply in debt and struggling to make ends meet.

New Education Barriers

The domestic policy bill recently signed into law eliminates the Grad PLUS loan program and caps lifetime federal borrowing for professional students at $200K—a sharp departure from the previous “Cost of Attendance” model. 

This change would significantly reduce federal borrowing capacity for students pursuing clinical degrees. Nurse anesthetists, physical therapists, and physicians—whose programs already require extensive and expensive training—would be forced to turn to alternative loans, often with higher interest rates and fewer protections.

In addition, changes to federal income-driven repayment plans and uncertainty around Public Service Loan Forgiveness (PSLF) eligibility mean that even students in shorter programs, such as respiratory therapy, could see reduced access to affordable repayment pathways. Together, these shifts compound the financial strain across the healthcare workforce.

Without action from institutions and employers, many students may delay or forgo clinical careers simply because they can’t finance their education. This slows the flow of new talent and puts even more pressure on a healthcare system already at capacity.

The Stakes for Higher Education

Colleges and universities are the front door to clinical careers. Health professions account for the second most popular field of study in the U.S. And that education isn’t optional: according to the Bureau of Labor Statistics, roughly 70% of all healthcare jobs require postsecondary education. That means higher education is not just a pathway, it’s a prerequisite.

But if students can’t afford to walk through that door, or choose not to because the return on investment no longer adds up, our healthcare workforce pipeline starts to erode.

This isn’t hypothetical. Take a physical therapy graduate, now required to complete a doctor of physical therapy program. With tuition and living costs, many graduate with $140K or more in debt. Their starting salary? Around $85K, translating to about $5,200 in monthly take-home pay in cities like Boston or Chicago. With loan payments often exceeding $1,550 per month, there’s little left for housing, food, family, or financial stability. That math doesn’t work, and students are starting to notice.

As financial pressures mount and relief options shrink, colleges face real risks:

  • Enrollment in healthcare programs may decline.
  • Completion rates could stall as students pause or drop out for financial reasons.
  • Employer partnerships may erode if graduates are unwilling, or unable, to enter the field. (Our School Deserts Index shows that in many regions, colleges preparing students for these careers are already scarce—and financing challenges risk making access even worse.)

In short, what’s happening in Washington is not just a student debt issue. It’s a direct threat to the sustainability of healthcare education.

The Response Can’t Be Passive

Higher education can’t wait for Washington to fix this. The cost of inaction? Shrinking programs, empty classrooms, and fewer clinicians entering the field. Enrollment in health professions and clinical sciences continues to decline, dropping 5% in associate programs and 2.5% in bachelor’s programs in recent years. It’s time to act with urgency and intention:

  • Partner with employers to offer tuition support and student loan repayment that eases debt before it becomes a barrier.
  • Embed financial counseling into healthcare programs so students understand—and can manage—the risks.
  • Push for policy that reflects the true cost of clinical training and safeguards income-driven repayment options.
  • Reimagine aid with bold models like income-share agreements or service-based forgiveness that make education more accessible.

This isn’t charity. It’s smart strategy. Programs that reduce student debt see stronger enrollment, higher completion, and better post-grad outcomes. In today’s competitive landscape, that’s a win for mission and margin.

What Employers Are Doing

Some healthcare systems are already adapting, including players like Boston Children’s Hospital, Novant Health, OhioHealth, and others who have committed a combined $100M+ to a new model. Rather than pouring money into transactional tools like sign-on bonuses—which studies show have a negative 72% ROI—employers are piloting structured loan repayment programs that start while students are still in school and are designed to drive long-term retention. These models offer early support, reduce financial stress, and secure future talent pipelines.

Forward-thinking systems are already seeing stronger retention and faster hiring by replacing sign-on bonuses with debt repayment. Institutions that partner with these employers become talent magnets while others risk falling behind.

But without higher education at the table to design aligned curricula, share data, and coordinate student engagement, these employer efforts won’t scale. That’s why collaboration is critical.

The Call for Higher Education

The healthcare workforce crisis is not looming—it’s here. 

Institutions that act now will shape the next generation of clinicians. Those that don’t will watch their programs (and their impact) shrink.

Now is the time to rethink affordability, reimagine partnerships, and recommit to the students and employers who are counting on us. 

Higher education has the power to help solve this. But only if it moves.

Tess Michaels is the Founder and CEO of Clasp, a venture-backed fintech company, tackling two urgent challenges: the student debt crisis and the healthcare workforce shortage.