7-02: HEAL Program Information - HEAL Program Transferred to U.S. Department of Education Effective July 1, 2014

Posted Date: July 2, 2014

Author: Pamela Eliadis, Service Director, System Operations & Aid Delivery Management, Federal Student Aid

Subject: HEAL Program Information - HEAL Program Transferred to U.S. Department of Education Effective July 1, 2014

From fiscal year 1978 through fiscal year 1998, the Health Education Assistance Loan (HEAL) Program insured loans made by participating lenders to eligible graduate students in schools of medicine, osteopathy, dentistry, veterinary medicine, optometry, podiatry, public health, pharmacy, chiropractic, or in programs in health administration and clinical psychology. It is no longer possible to obtain a new HEAL Program loan. The making of new HEAL Program loans was discontinued on September 30, 1998.

On July 1, 2014, the HEAL Program was transferred from the U.S. Department of Health and Human Services (HHS) to the U.S. Department of Education (ED) as required by the Consolidated Appropriations Act, 2014 (Pub. L. 113-76). ED has begun HEAL Program processing, moved HEAL Program Web pages into production, and connected a toll-free HEAL Program phone number. HHS has stopped all HEAL Program processing, removed the HEAL Program pages from its Web site, and disconnected its HEAL Program phone number. From this point forward, ED is responsible for managing the servicing of non-defaulted HEAL Program Loans and the collection of defaulted HEAL Program loans.

In this announcement, we present information as follows:

  • HEAL Program Transfer Overview
  • HEAL Program Information on Web
  • HEAL Program Contact Information
HEAL Program Transfer Overview

There are some aspects of HEAL Program processing that will change now that ED is responsible for the HEAL Program; however, most aspects will stay the same. We have communicated with HEAL Program lenders and lender servicers about the program transfer and potential impact to their organizations. While there are essentially no changes for HEAL Program borrowers, we will inform them of the program transfer over the summer.

  • ED will continue to honor the HEAL Program contracts with lenders and lender servicers that are in effect through September 30, 2014. Later this summer, we will send HEAL Program lenders and lender servicers new contracts for execution.
  • ED will continue to use the HEAL On-Line Processing System (HOPS) to collect data related to borrowers, loans, claims, schools, lenders, lender servicers, and litigation actions. HEAL Program lenders and lender servicers will send files to and receive files from HOPS just as they have done to date.

Given the brief break in processing prior to July 1, 2014, items such as lender file updates, lender reports, forbearance approval requests, and claim submissions are queued in HOPS. We will now work the backlogged items from oldest to newest. We are committed to clearing the backlog as expeditiously as possible.

Despite the processing break, we advised HEAL Program lenders and lender servicers to continue to submit claims when due. We will follow up regarding the status of each submitted claim as soon as possible and will ensure that there is no penalty assessed to a lender or lender servicer provided the claim was submitted prior to the filing deadline.

  • ED will continue to partner with the HHS Program Support Center (PSC) for holding and collecting on defaulted HEAL Program loans after claims are paid. HEAL Program lenders and lender servicers will continue to cease responsibility for a HEAL Program loan once a claim is paid.
  • ED will issue the HEAL Program interest rates effective July 1, 2014 through September 30, 2014 (also referred to as the quarter ending September 30, 2014) as soon as possible in July 2014. In addition to sending HEAL Program lenders and lender servicers an interest rate communication generated through HOPS, ED will post the new interest rate information in the HEAL Program Information area on our Information for Financial Aid Professionals (IFAP) Web site (see below for additional information).

Until we issue the HEAL Program interest rates for the quarter ending September 30, 2014, HEAL Program lenders and lender servicers will continue to calculate interest on HEAL Program loans using the interest rates for the quarter ending June 30, 2014. Once we provide the new interest rate information, lenders and lender servicers will begin using the new interest rates to calculate interest on borrowers’ HEAL Program loans. For cases in which the new interest rate on a borrower’s loan is lower than the previous interest rate, lenders and lender servicers will recalculate the interest that should have been charged since July 1, 2014 and adjust the borrower’s account accordingly.

  • ED has transferred the Office of Management and Budget (OMB) clearance of HEAL Program forms from HHS to ED. We are now updating the OMB clearance information on each form and replacing HHS references and contact information with ED’s information. Once completed, we will post the updated versions of the forms in the HEAL Program Information area on our IFAP Web site (see below for additional information).

Until we post the updated versions of the HEAL Program forms, HEAL Program lenders and lender servicers will continue to use the HHS versions of the forms. Once we post the “ED” versions of the forms, lenders and lender servicers will begin using the updated forms.

  • ED has established new contact information for HEAL Program lenders and lender servicers. Lenders and lender servicers will use a new toll-free phone number and e-mail address for general questions and a new e-mail address and mailing address for claims process questions and submissions.

The new contact information for lenders and lender servicers is located on the HEAL Program for Lenders and Lender Servicers Contact Information page on the IFAP Web site.

Note: On June 16, 2014, HHS stopped accepting e-mails sent to its HEAL Claims mailbox. An automatic reply message instructed senders to resend their e-mails to one of our new HEAL Program e-mail addresses beginning July 1, 2014. A recipient of the automatic reply message must resend his or her e-mail to the appropriate e-mail address. E-mails received in the HHS HEAL Claims mailbox prior to June 16th that were not worked or completed before the shutdown were forwarded to us. We will now work the backlogged e-mails from oldest to newest. We are committed to clearing the backlog as expeditiously as possible.

HEAL Program Information on Web

We have established a HEAL Program Information area on our IFAP Web site. The HEAL Program information area consolidates previous program documentation posted by HHS, new contact information, and new program guidance under four categories—References, Current Guidance, Interest Rates, and Forms. Each time we update the HEAL Program Information area, a notice will appear on the IFAP Web site’s “What’s New” page and in the IFAP subscription e-mail (see below for additional information). The HEAL Program Information area is located at http://ifap.ed.gov/HEALInfo/HEALInfo.html.

We will post new HEAL Program guidance through the IFAP Web site’s Electronic Announcement communication type. We will identify such announcements by including the words “HEAL Program Information” at the beginning of the subject line. Notice of each announcement will appear on the IFAP Web site’s “What’s New” page and in the IFAP subscription e-mail. If a HEAL Program lender or lender servicer has not already subscribed to weekly e-mail notifications of IFAP postings, this would be a good time to do so. An IFAP user subscribes following these four easy steps:

1) Go to the IFAP Home page located at ifap.ed.gov. 

2) Click on MyIFAP at the top of the right sidebar. 

3) Select New User Registration. 

4) Complete the electronic sign up process.

We have added HEAL Program items on our StudentAid.gov Web site. These items will provide appropriate contact information for HEAL Program borrowers who visit that site. The primary HEAL Program item is located on the Loans page.

HEAL Program Contact Information

We have posted new HEAL Program contact information on two IFAP Contact Information pages.

Thank you for directing HEAL Program inquiries as outlined on the Contact Information pages.

 

Publication Date: 7/2/2014

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