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Higher Ed Community Calls for Decreased Interest Rates on Student Loans

April 27, 2012—The AAMC April 26 joined  more than 40 higher education associations in support of maintaining decreased undergraduate interest rates on Stafford loans. Without congressional action, the interest rate on Stafford loans for undergraduate students is scheduled to double from 3.4 percent to 6.8 percent on July 1, 2012. Both House Republicans and Senate Democrats have proposed bills that would avert the interest rate increase. 

The House April 27 approved the Interest Rate Reduction Act (H.R. 4628). The Senate is scheduled to consider its version of the measure, the Stop the Student Loan Interest Rate Hike Act of 2012 (S.2343), the week of May 7.

Both the House and Senate bills would extend the lower interest rate until July 1, 2013; however, the Senate bill offsets the cost of the extension by raising taxes on so-called “S” corporations, while the House proposal would repeal the Prevention and Public Health Fund established under the Affordable Care Act (ACA, P.L. 111-148 and P.L. 111-152). The White House issued an April 27 Statement of Administration Policy objecting to use of the Fund as an offset, and indicated that if the bill is presented to the president, “his senior advisors would recommend that he veto” it.

The AAMC has opposed the use of the Prevention and Public Health Fund as an offset for other measures [see Washington Highlights, Sept. 10, 2010].


Matthew Shick, JD
Director, Gov't Relations & Regulatory Affairs
Telephone: 202-862-6116


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Washington Highlights, a weekly electronic newsletter, features brief updates on the latest legislative and regulatory activities affecting medical schools and teaching hospitals.

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