ELFI expands access to healthcare education financing as federal loan changes take effect this month

EdMed supports next generation of physicians and healthcare professionals amid growing workforce shortages

KNOXVILLE, Tenn., July 6, 2026 /PRNewswire/ -- ELFI, a division of SouthEast Bank, today highlighted the growing importance of its EdMed student loan program as significant changes to federal student loan funding take effect July 1, 2026, reshaping how medical and healthcare students finance their education. EdMed was introduced in May to help address these evolving needs, providing a private student loan solution designed specifically for students pursuing careers across various healthcare disciplines.

As of July 1, federal policy changes, including the elimination of Grad PLUS loans for new borrowers and new caps on direct unsubsidized Loans, went into effect and are expected to create funding gaps for many incoming medical and healthcare students. While some current borrowers may continue under existing provisions, new cohorts entering programs this summer and beyond will face tighter borrowing limits that may not fully cover the cost of education.

These changes for medical education loans already have drawn national attention. A coalition of 25 states and the District of Columbia has filed a federal lawsuit challenging the new loan limits, arguing the restrictions could worsen healthcare workforce shortages by limiting access to higher education for aspiring providers. Policymakers and industry experts have similarly warned that reduced borrowing capacity may discourage qualified students from pursuing careers in medicine and other healthcare fields, ultimately reducing the number of providers entering the workforce.

The concern is especially urgent given existing workforce trends. The United States faces a growing physician shortage, with projections indicating a deficit of up to 141,000 physicians in the coming years. Expanding access to higher education and training pathways is widely recognized as essential to strengthening the healthcare workforce and meeting future patient demand.

"Recent changes to the federal student loan system have created meaningful gaps for medical and healthcare students pursuing professional and graduate degrees," said Barbara Thomas, Chief Operating Officer of SouthEast Bank and head of the ELFI division. "EdMed was developed to help address those realities, ensuring students can continue pursuing careers in healthcare without being sidelined by financing constraints. Student loan terms shouldn't be a barrier for someone becoming a doctor, nurse or other much needed and highly respected healthcare professional."

EdMed provides graduate school financing tailored to the unique structure of healthcare education, including multi-year eligibility; funding for up to 100% of the cost of attendance; flexible income and cosigner requirements; and extended deferment options during residency. These features are designed to align with the long and often costly training timelines required for medical, dental, veterinary, and other advanced medical degrees and provide flexible options for financing medical residency.

Rising educational costs further compound the challenge facing aspiring healthcare workers. A recent study commissioned by ELFI found that the median four-year cost of medical school has increased 16% over the past five years, with 70% of recent graduates carrying education debt as they enter residency, with an average amount around $223,000. As federal loan capacity contracts, private financing solutions are becoming an increasingly essential component in how students plan for and complete their education.

"Medical education has long required a significant financial commitment, but the structure that helped make it manageable is changing," said Marc Schoonover, general manager of ELFI. "With EdMed, we believe private lenders play an important role in helping ensure that future physicians and healthcare providers can access the education they need – and that U.S. communities continue to benefit from a strong pipeline of trained professionals."

In addition to supporting medical (MD) students, EdMed is available to students pursuing a wide range of healthcare degrees, including dentistry, osteopathic medicine, veterinary medicine, optometry, pharmacy and nursing. The program reflects the broader need to support all segments of the healthcare workforce development as demand continues to grow.

ELFI also has collaborated with the AAMC to provide additional support for MD students through the MedLoans™ borrower benefit program, which offers interest rate discounts for all eligible applicants.

As more students navigate the intersection of rising education costs and reduced federal funding, solutions like EdMed help ensure that aspiring healthcare professionals can continue their education – and ultimately contribute to addressing workforce shortages and enhancing provision of medical services for years to come.

EdMed graduate and medical school loans are available to students enrolled in MD, DO, DPM, DDS, DMD, DNP, MSN, OD, DVM and PharmD degree programs. Eligibility is subject to credit approval, school certification, enrollment verification and other requirements.

For more information and to check rates and eligibility, visit https://www.elfi.com/student-loans/graduate-school-loans/medical-student-loans/.

Media contact:
Lauren Miller
MoxCar Marketing + Communications
865-599-4050
[email protected]

SOURCE ELFI