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(98-L-210) (98-L-210) This letter provides clarification of an institutional eligibility criteria for the awarding of increased amounts of unsubsidized loans under the Direct Loan and FFEL programs for certain Health Professions students.

DCLPublicationDate: 10/1/98
DCLID: 98-L-210
AwardYear:
Summary: This letter provides clarification of an institutional eligibility criteria for the awarding of increased amounts of unsubsidized loans under the Direct Loan and FFEL programs for certain Health Professions students.


October 1998

GEN-98-23
98-G-313
98-L-210

Summary: This letter provides clarification of an institutional eligibility criteria for the awarding of increased amounts of unsubsidized loans under the Direct Loan and FFEL programs for certain Health Professions students.

Dear Colleague:

Based upon a number of questions we have received, it appears that there may be some misunderstanding about one of the institutional eligibility requirements that must be met in order for an institution to award increased amounts of unsubsidized loans under the Direct Loan and FFEL programs for certain Health Professions students. Specifically, some schools appear to be unclear about the statement in our most recent Dear Colleague Letter (GEN-98-18) that restricted institutional eligibility to schools that had participated in HEAL during FY 95 and had not subsequently withdrawn from the HEAL Program.

Dear Colleague Letter GEN-98-18 included the following:

To award unsubsidized loans in excess of current maximums, a school must have made disbursements of HEAL Program loans during FY 95 and not have withdrawn [emphasis added] from the HEAL Program since that time. The increased unsubsidized loan limits are intended to assist health professions students who are ineligible for HEAL Program loans solely because of the budgetary restrictions placed on that program. If a school did not participate in HEAL during FY 95, or has withdrawn [emphasis added] from HEAL participation since
FY 95, its students are not eligible for HEAL because of that action and not because of the phaseout.

It is important to note that the statement in GEN-98-18 makes a distinction between a school not having participated in HEAL during FY 95 and having withdrawn since FY 95. If a school participated in HEAL during FY 95 (made disbursements from the HEAL Program during the period October 1, 1994 through September 30, 1995) and did not officially withdraw or had not been terminated from the HEAL program subsequent to FY 95, that school was and remains eligible to award the increased amounts of unsubsidized loans in the Direct Loan or FFEL programs even if it had stopped making HEAL disbursements after FY 95. According to information we have received from the Department of Health and Human Services (HHS), only 14 schools have withdrawn or been terminated from the HEAL Program since FY 95, and 12 of those did not participate in HEAL during FY 95. Thus, only two schools are affected by the requirement that a school not have withdrawn from HEAL subsequent to
FY 95. Other schools that made HEAL Program disbursements during FY 95 remain eligible regardless of their subsequent HEAL activity (or non-activity) since they did not withdraw or were not terminated from the HEAL Program.

We apologize for any confusion or misunderstanding our earlier communications on this subject may have caused. If you have any further questions, please contact Vanessa Freeman of my staff at (202) 708-8242 or by email at vanessa_freeman@ed.gov.


Sincerely,


Diane E. Rogers
Acting Deputy Assistant Secretary
Student Financial Assistance Programs

Last Modified: 10/12/1998