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Nurse Faculty Loan Program Guidance

VIII. Other Information

ROLE OF SCHOOL OFFICIALS

We encourage the school of nursing coordinator, financial aid office coordinator, and the authorized official at the school to discuss and decide their roles in administering the NFLP prior to submitting the application. Communication between the coordinators must be maintained to properly monitor the status of NFLP recipients.

1. Role of the School of Nursing Coordinator – The school of nursing is the eligible applicant. Therefore, the school of nursing, not the financial aid office or other administrative unit, must prepare and submit the NFLP application. The school of nursing should notify the financial aid office of its intent to apply for an NFLP award and work with the financial aid office on activities such as, but not limited to, advising potential NFLP recipients and submitting required reports.
   
   
2. Role of the Financial Aid Office Coordinator – The financial aid office generally administers the NFLP fund (i.e., issuing the Promissory Note and verifying employment status, repayment/cancellation schedules and collections following graduation). The financial aid office may be responsible for completion and submission of the NFLP Annual Operating Report or may work with a designated office within the school. The financial aid office should work with the school of nursing on activities such as, but not limited to, advising potential NFLP recipients and submitting required reports.
   
   
3. Role of the Authorized Official – The authorized official of the applicant school is the person legally and financially responsible for the use and disposition of any HHS funds awarded on the basis of this NFLP application; and certifies that the information in the application is correct and the school agrees to comply with the applicable terms and conditions placed on the award.
   
   The school must notify HRSA’s Division of Nursing of any change in school officials cited in the application. Schools should use the “Notification of Change in Contact Personnel” form (EXHIBIT A) included in this application.

OVERVIEW OF INSTITUTIONAL MANAGEMENT OF NFLP FUNDS

The NFLP agreement requires the school to establish and operate the NFLP fund. This section offers a brief introduction to the management of the NFLP fund. For additional information, visit the HRSA Fiscal Management web site.

IMPORTANT NOTE: Please be aware that the HRSA Fiscal Management web site provides general guidance and procedures for other HHS programs that are similar to the NFLP. The specific requirements for the NFLP may differ (i.e. repayment periods, cancellation provisions, service obligation requirements, exhibits). Applicant schools should contact the Division of Nursing staff for any clarification (See Section VII of this guidance).

1. Cash Balances

The unused accumulation (cash balance) in the NFLP fund must be reported annually on the AOR for the specified reporting period. The unused accumulation will be monitored yearly. If a school is determined to have an excessive unused accumulation, future awards will be affected.

HRSA reserves the right to terminate participating NFLP schools that do not use awarded NFLP funds over a 2-year period. HRSA will notify the school in writing that their program will be terminated following consultation with the school.

NOTE: For existing NFLP schools, the unused accumulated amount (NFLP loan fund cash balance) is determined by the cumulative FCC awarded to the school plus the cumulative cash receipts total reported (including the cumulative ICC deposited) minus the cumulative cash disbursements total reported. The award balance in PMS (if applicable) will be added to the cash balance reported to assess the “actual” unused accumulation amount.

Schools should review the balance in the NFLP fund on a semi-annual basis to determine whether the fund balance exceeds its needs. Refer to Collections under the Fiscal Management web site for information about cash balances.

2. Carryover of Unused NFLP Funds

Schools may request approval to retain (carryover) the unused accumulation of NFLP funds for a 1-year period. The unused accumulation should be allocated during the academic year approved for carryover.

3. Reporting of NFLP Loan Disbursements

PMS requires the school to complete and submit the quarterly PMS Form 272 to report NFLP loan disbursements.

4. Cancellation Payments by HHS

When a school cancels all or any part of a loan or interest, the Secretary of HHS will pay to the school an amount equal to the school's proportionate share of the cancelled portion, as determined by the Secretary.

5. Write-Off Procedures

Schools must adhere to the policies and procedures for write off review of uncollectible loans. If a school writes off a loan, it retains the authority to collect the loan if collection is possible at a later time. The school must notify the Division of Nursing through the reporting process of subsequent collections on loans approved for write off. For more guidance on write-off procedures, see Collections under the Fiscal Management web site.

6. Institutional Termination and Withdrawal

Upon withdrawal or termination of institutional participation in the program, the balance in the NFLP fund will be distributed between the HHS and the school in proportion to the amounts contributed by each. Schools must remit the Federal Government's proportionate share of amounts received thereafter in payment of loan collections and any other earnings on a quarterly basis.

At the time of each quarterly remittance, the school should withdraw its proportionate share of the quarterly cash accumulation from the fund. See Collections under the Fiscal Management web site for a description of procedures for remittance of collections.

Remittance checks must:

• be made payable to the HHS;
• include the CAN# 3760333, the school’s entity identification number, the assigned OPSID Number, and the PMS Payee Account Number; and
• be mailed to:
  Department of Health and Human Services
  Division of Payment Management
  P.O. Box 6021
  Rockville, Maryland 20852

Schools must forward a copy of the remittance documentation to the NFLP Project Officer in the Division of Nursing.

EXHIBIT FORMS

The exhibit forms listed below are provided for institutional use in administration of the NFLP. The Exhibt Forms are available for downloading in MS Word format.. Please contact the Division of Nursing if you are unable to access these forms.

With the exception of the Annual Operating Report (EXHIBIT B1-B2) and the Promissory Note (EXHIBIT C), schools may modify the sample forms listed below.

• EXHIBIT A Notification of Change in Contact Personnel
• EXHIBIT B-1 NFLP Annual Operating Report (OMB Number: 0915-0314)
• EXHIBIT B-2 Instructions for Completing the Annual Operating Report
• EXHIBIT C NFLP Promissory Note
• EXHIBIT D Statement of Rights and Responsibilities
• EXHIBIT E NFLP Loan Application
• EXHIBIT F Certification of Employment Form
• EXHIBIT G NFLP Request for Partial Cancellation
• EXHIBIT H Disability Checklist
• EXHIBIT I NFLP Request for Postponement of Installment Payment
• EXHIBIT J NFLP Deferment Form
• EXHIBIT K Exit Interview – Questionnaire
• EXHIBIT L Forbearance Request Form

STUDENT ELIGIBILITY

Schools must ensure that students meet the eligibility criteria to receive NFLP loans. Schools must verify the accuracy of the student applicant’s information to determine eligibility.

1. Citizenship Status

A student applicant must be a citizen or national of the United States, or a lawful permanent resident of the United States, the Commonwealth of Puerto Rico, the Northern Mariana Islands, the Virgin Islands, Guam, American Samoa or the Trust Territory of the Pacific. A student who is in the United States on a student or visitor's visa is not eligible for a NFLP loan.

2. Enrollment Status

Students who receive a NFLP loan must be enrolled full-time or part-time in an eligible master’s or doctoral program that offers an education component(s) to prepare qualified nurse faculty. The school will define “full-time or part-time” status for the program as recorded by the Registrar’s office.

Students must maintain enrollment for a minimum of 2 consecutive terms/semesters (either full-time or part-time) during an academic year while receiving the NFLP loan support.

1. Enrollment Beyond 2 Semesters/Terms – Students may receive NFLP support for enrollment beyond 2 terms/semesters during the academic year if required by the program (i.e. summer session).
2. Enrollment During Dissertation – Students must have prior participation in the NFLP to receive support during the dissertation phase and must complete the specified education component(s) before graduation from the program of study.
3. Enrollment During Last Year of Program – NFLP students enrolled in the last year of the program are not required to enroll for 2 terms if the program requirements are met (i.e. the NFLP recipient may receive support in the Fall (or one semester) to complete the degree.

Leave of Absence from Program

Temporary leave of absence from the nurse education program that is 1) approved by the school, and 2) in accordance with the institution’s student enrollment and leave policy, is not considered to be a breach of the NFLP Promissory Note by the borrower.

The NFLP encourages the school to make a determination that there is a reasonable expectation that the student will return to the school.

The NFLP encourages the school to require students to provide a written, signed, and dated request that includes the reason for the request prior to the leave of absence. However, if unforeseen circumstances prevent a student from providing a prior written request, the school may grant the student's request for a leave of absence, if the school documents its decision and collects the written request at a later date.

Active Military Duty

Temporary leave under the NFLP includes a period up to 3 years during which the borrower is ordered to active duty as a member of a uniformed service of the United States (Army, Navy, Marine Corps, Air Force, Coast Guard, the National Oceanic and Atmospheric Administration Corps, or the U.S. Public Health Service Corps). This does NOT include a borrower who either voluntarily joins a uniformed service or is employed by one of the uniformed services in a civilian capacity.

3. Academic Status

The student must be in good academic standing, as defined by the school, and capable, in the opinion of the school, of maintaining good academic standing in the course of study. Schools may choose to apply the satisfactory academic progress guidelines for programs under Title IV of the Higher Education Act. If an NFLP borrower ceases to be a student in good academic standing, the school must stop disbursement of the NFLP loan.

4. Default on Other Federal Loans

According to Federal law, a student is ineligible to receive a NFLP loan if a judgment lien has been entered against him/her based on the default on a Federal debt, 28 U.S.C. 3201(e).

NFLP SUPPORT TO STUDENTS

Under the NFLP, continuing students committed for support must be given the opportunity for loan support ahead of new students requesting NFLP loans. Students who receive a NFLP loan must be enrolled full-time or part-time in an eligible master’s or doctoral nursing program at the time the NFLP loan is established.

Prior to making a loan, the school should determine whether the student will enroll for a minimum of 2 consecutive terms/semesters (i.e. Fall-Spring, Spring-Summer, Summer-Fall or Spring-Fall) during the academic year. Students are permitted to complete a second term/semester during the summer session, as allowed by the school to meet the 2-term requirement.

IMPORTANT NOTE: The NFLP loan recipient must complete the education component(s) required to prepare qualified nurse faculty prior to completing the program of study.

• NFLP loan recipients who wish to remain enrolled after completing a master’s degree program must enroll in an advanced level, i.e. doctoral nursing degree program. Students that pursue the doctoral degree should not duplicate education courses that were already completed.
  
  
• The NFLP does not support post-doctoral nursing programs (i.e. fellowships). NFLP recipients who graduate and participate in post-doctoral programs may request deferment of payment.

1. Full Support to Students

The school should offer full support or the amount requested by the student to cover the full or partial tuition/fees for the academic year. NLFP loans should be made on a first-come-first-serve basis for an academic year until funds are expended. Full support includes the cost of tuition, fees, books, laboratory expenses and other reasonable education expenses.

IMPORTANT NOTE: NFLP loans do not include stipend support (i.e., living expenses, student transportation cost, room/board, personal expenses).

2. Maximum Amount of NFLP Loan(s) to Students

NFLP loans to a student may not exceed $30,000 for an academic year. Schools should inform a loan recipient that, subject to the availability of funds and the recipient maintaining good academic standing, the NFLP loan will be made annually for the period required to complete the course of study, not to exceed 5 years. Students who remain enrolled beyond 5 years may not receive additional NFLP support.

The NFLP is not a need-based program. FAFSA data and other financial records are not required to determine eligibility for the NFLP. FAFSA data may be used to confirm U.S. citizenship and non-defaulting status on federal loans.

The NFLP loan(s) made to a recipient is not transferable to another school. The student may transfer to another participating NFLP school and request NFLP loan support; however, the cumulative total should not exceed the maximum of $30,000 per academic year, and not to exceed 5 years of support.

3. Multiple Program Support to Students

In addition to NFLP support, students may receive support from other Federal programs, provided that the funds are not used to cover the same costs during the academic year. The student may already receive other Federal support that does not cover all costs (tuition, fees and other expenses) for the academic period; in this case, the student may receive NFLP support to cover the remaining costs, excluding stipend support.

Example: A school that administers both the Advanced Education Nursing Traineeship Program (AENT) and the Nurse Faculty Loan Program (NFLP) may offer support under the AENT program to cover stipends and room/board costs since these costs are not allowed under the NFLP. The tuition costs and other fees for the academic year may be covered with NFLP funds.

MAKING NFLP LOANS TO STUDENTS

1. Entrance Interview

The school must conduct and document an entrance interview for each academic year during which the student receives the NFLP loan. The school is not required to conduct an entrance interview each time a student receives a disbursement within a single academic year; however, many schools have found requiring a borrower to complete a new "borrower information" form at the time of each disbursement to be useful in the collections process.

2. Documentation

Schools are responsible for distributing NFLP applications to students. EXHIBIT E is the NFLP Loan Application that is completed during the entrance interview. The NFLP loan application must contain sufficient information for the school to determine if the student meets the eligibility criteria for the program and to assist the school in the loan collection process, if necessary, after the student leaves the school.

The school must document that the student is informed of the service obligation associated with the cancellation of the loan. See Collections under the Fiscal Management web site for entrance interview requirements. No matter what format or method the school uses to conduct an entrance interview, it must document that the borrower is aware of the rights and responsibilities associated with the NFLP loan.

The school may use a:

• Separate statement listing the borrower's rights and responsibilities (EXHIBIT D) which the borrower must sign and date to acknowledge that he or she has been provided the information; or
• Statement of the borrower's rights and responsibilities that is incorporated into a disclosure document.

The school must document entrance interviews by maintaining the papers signed by the borrower in his/her file. Documentation consists of evidence that the borrower:

• is aware of his /her rights and responsibilities; and
• has provided information to aid in skip tracing, if needed

The school has discretion in deciding which office (e.g., financial aid, fiscal, loan collection, Dean's) will be responsible for entrance interviews.

3. Student Records

The school must maintain an individual file for each NFLP loan recipient and maintain these records for at least three years after the loan is retired. This file should contain clear evidence of how the school evaluated each application for financial assistance. Even if no funds were awarded, the school must retain evidence of rejection, cancellation, or declination for the same period of time.

The student file should contain documents relating to each academic year application so that each application cycle is complete and auditable. Student files must, at a minimum, include the types of documents that support this information, which include:

• approved student applications;
• loan notification letter--institutional copy;
• copy of signed Promissory Note(s);
• signed disclosure (i.e., Statement of Borrower's Rights and Responsibilities);
• records of enrollment status for each academic year of NFLP support
• records of payments and cancellation; and
• records of approved leave of absence, deferment, forbearance, or default

HHS permits the school to maintain their records in a variety of formats at the option of the school. Record keeping formats include:

• computer;
• electronic;
• microfiche/microfilm; or
• paper

For information on maintenance of records, see Accounting under the Fiscal Management web site.

NFLP PROMISSORY NOTE

Each NFLP loan made to the student must be documented by a Promissory Note which describes the terms and conditions of the loan (EXHIBIT C). The borrower must sign the Promissory Note prior to disbursement of loan funds for the academic year. EXHIBIT C is a sample copy of the open-end Promissory Note for schools to maintain a “single” Note signed each time a student receives a loan advance. However, schools are permitted to use a closed-end Promissory Note to maintain a “separate” Note for a specific period each time a student receives a loan advance. The loan amounts advanced to the students for the combined academic period(s) of NFLP support should be combined for repayment of the total of loans made to a student. The school must give the borrower an updated copy of the Promissory Note. Schools may establish an “electronic” Promissory Note for the NFLP at their school.

IMPORTANT NOTE: Modification of the Promissory Note requires prior approval by HRSA.

The Promissory Note is the legal document that binds the student to his/her repayment obligations. The school must ensure that the Promissory Note is complete, legible and signed. Any change in the statute that affects the terms of the Promissory Note requires that a new Promissory Note be signed for future loans. The Promissory Note is a major asset and the school must adequately safeguard it against fire, theft, and tampering. The particular method of insuring this protection is the school's responsibility.

1. Payments to Students

The school determines the number and the amount of loans disbursed to the student. However, NFLP loans may not exceed what the school determines is necessary for the student to pay for any academic year (e.g., semesters, terms, or quarters). The school may advance payments directly to the student or it may credit the disbursement to the student's tuition account. In either case, payments must be clearly documented.

The school must stop disbursement to the NFLP recipient if the borrower:

• withdraws from the institution;
• fails to meet the academic standards of the institution; or
• requests to terminate NFLP participation

2. Loan Notification Letter to Students

After the school has determined individual NFLP loans, it must send a loan notification letter to each student. The letter should provide a space for the student to accept or reject the NFLP loan. Duplicate copies of the letter should be provided so that the student can retain one copy and return the original copy to the school.

TERMS AND CONDITIONS OF NFLP LOANS TO STUDENTS

1. Completion of Nursing Education Program

The NFLP recipient must agree to the terms and conditions of the NFLP loan as specified in the Promissory Note signed by the student. The student must enroll full-time or part-time for 2 consecutive terms/semesters during the academic year and complete the nursing education program that prepares students to become nurse faculty.

IMPORTANT NOTE: The education course/component(s) offered must be completed while receiving NFLP support and prior to graduating from the program.

Schools are strongly encouraged to inform the student of the employment and repayment guidelines for NFLP borrowers.

2. Employment Status

The NFLP borrower must submit certification of employment to the lending school within a reasonable timeframe as determined by the lending school, but no later than 12 months following graduation. A sample certification of employment form is provided as EXHIBIT F. At a minimum, the certification of employment must state the date the NFLP recipient began full-time employment as nurse faculty in accordance with the terms of the NFLP Promissory Note and must be signed and dated by the recipient. The recipient is responsible for submitting certification of employment to the lending school in order to determine the interest rate applicable to the unpaid loan balance.

NFLP borrowers are limited to a 12-month timeframe to establish employment as full time nurse faculty at a school of nursing following graduation from the program. If employment verification is not submitted within the 12-month period, the borrower will not be eligible for the NFLP loan cancellation provision.

• Leave During Employment – Paid or unpaid leave needs to be consistent with the institution's policy and is subject to supervisory approval.
• Changing Employment – A reasonable period of time to change from one place of employment to another does not constitute a break in employment.

3. Change of Name or Address

The borrower is required to inform the lending school of any change of name or address after ceasing to be a student at the school of nursing. The borrower must also inform the lending school of any change of name or address during the repayment period.

CANCELLATION PROVISION

The NFLP is a direct loan program with a cancellation provision for recipients of the loan. Section 846A of the Public Health Service Act authorizes the lending school to cancel up to 85% of the NFLP loan. The borrower must serve as full-time nurse faculty for a consecutive four-year period at a school of nursing following graduation from the program to cancel the maximum amount of the loan.

The borrower may cancel:

• 20% of the principal and the interest on the amount of the unpaid loan balance upon completion of each of the first, second, and third year of full-time employment; and
• 25% the principal of and the interest on the amount of the unpaid loan balance upon completion of the fourth year of full-time employment.

Example 1:
If the borrower is employed as full-time nurse faculty for 4 consecutive years following graduation from the program, the principal and interest on the unpaid balance of the loan will be cancelled at the end of each year; 20% for the first, second and third year and 25% for the fourth. The lending school must establish a repayment schedule for the borrower to begin repayment of remaining unpaid principal and interest.

Example 2:
If a borrower is employed full-time as nurse faculty for 2 consecutive years following graduation and ceases employment in the third year, 20% of the unpaid principal and interest will be cancelled at the end of the first and second year; however, the borrower may NOT request cancellation of unpaid principal and interest in the third year. The lending school must establish a repayment schedule and the borrower must begin repayment of the remaining unpaid principal and interest on the first day after the last date of employment at the prevailing market rate.

The Promissory Note, which specifies the terms and conditions of the NFLP loan, binds the student to his/her repayment obligation and states the provisions for loan cancellation.

The borrower is responsible for requesting cancellation. After the end of each complete year of employment, the borrower must submit a NFLP Request for Partial Cancellation Form (See below).

NFLP REQUEST FOR POSTPONEMENT OF INSTALLMENT PAYMENTS FORM

When a borrower is employed full-time as a faculty at a school of nursing and will request partial cancellation of the loan at the end of each complete year of employment, the borrower may obtain a postponement of installment payments on the loan. The borrower may submit the Request for Postponement of Installment Payment Form (EXHIBIT I) for each period of cancellation. This form is intended to notify the lending school that repayment is not expected from borrower.

The form requires the borrower to:

• complete Part I;
• obtain certification by the employing school of nursing, Part II; and
• forward the original and one copy to the lending school.

The school must notify the borrower of the approval of the Request for Postponement of Installment Payment and retain the form in the borrower's file. The lending school must maintain current loan accounts for the borrower documenting any periods of postponement of payments.

The borrower must notify the lending school of termination of full-time employment as faculty prior to completion of a year within 30 days after the last day of such employment, and the lending school must then place the borrower back into repayment with installment payment(s) payable to the lending school according to the borrower's repayment schedule.

NFLP REQUEST FOR PARTIAL LOAN CANCELLATION FORM

Borrowers may request PARTIAL loan cancellation each year while employed as full-time nurse faculty at a school of nursing over a consecutive 4-year period. To receive loan cancellation, the Borrower must submit the Request for Partial Cancellation of Loan Form (EXHIBIT G) to the lending school at the end of each complete year of full-time employment as faculty at a school of nursing.

This form requires the borrower to:

• complete Part I;
• obtain certification by the employing school of nursing to complete Part II; and
• forward the original and one copy to the lending school for cancellation of loan at the appropriate rate in lieu of payment.

The lending school will complete Part III indicating the amount of cancellation (and interest) and return a copy to the borrower as the receipt that it approved the loan cancellation.

If the borrower takes a break from full-time employment as nurse faculty during the year, the borrower is not eligible for loan cancellation and must begin repayment of the NFLP loan immediately.

REPAYMENT PROVISION

1. Grace Period

The grace period for NFLP loan repayment is 9 months. Neither interest nor principal is payable during the 9-month grace period.

2. Repayment Period

The repayment period for an NFLP loan begins following a 9-month grace period after the borrower ceases to be enrolled as a student in the advanced nurse education program.

Following graduation from the program, NFLP borrowers who fail to establish employment as full-time nurse faculty at a school of nursing must begin repayment of the NFLP loan following the 9-month grace period.

The unpaid loan balance is repayable in equal or graduated periodic installments over a 10-year repayment period. Installment payments must be made no less often than quarterly, in equal or graduated installments, in accordance with the terms of the schedule provided by the lending school and agreed to by the borrower. Refer to Collections under the Fiscal Management web site as a resource for establishing repayment schedules.

3. Repayment Schedule

If the borrower ceases to pursue the advanced education nursing program, the NFLP loan is repayable in equal or graduated periodic installments over a 10-year period that begins 9 months after the individual ceases to pursue a course of study at the school of nursing.

The NFLP borrower is allowed 3 additional months beyond the 9-month grace period to establish employment as full-time employment as nurse faculty.

If the borrower is not employed full-time as nurse faculty at a school of nursing within 12 months following graduation from the program, the NFLP loan is repayable in equal or graduated periodic installments over a 10-year period. The loan is repayable following the 9-month grace period. However, if the borrower becomes employed between the 10th through 12th month following graduation, the borrower may stop the repayment schedule.

If the borrower’s NFLP loan has been cancelled for the maximum portion (up to 85%) of the principal amount of the loan and interest, the remaining amount (15% or more depending upon years of employment) of the unpaid loan balance is repayable in equal or graduated periodic installments over the remaining six years of the repayment period.

Refer to Collections under the Fiscal Management web site as a resource for institutional responsibility in establishing repayment schedules.

4. Combining NFLP Loans

When a borrower has more than one NFLP loan outstanding, the sum of the amounts loaned should be combined for repayment purposes (i.e. multiple loans disbursed to a recipient during the academic year or years of support).

NFLP loan disbursements from more than one NFLP school can not be combined for repayment purposes.

5. Prepayment

The borrower may, at his or her option and without penalty, prepay all or any part of the principal and accrued interest at any time. If an accelerated payment is made, that prepayment must first be applied to any accrued interest and then to the principal balance.

INTEREST

The NFLP loan bears interest on the unpaid balance at the rate of 3% per annum beginning 3 months after the borrower ceases to be enrolled as a student in the advanced nurse education program. Borrowers employed as full-time nurse faculty at a school of nursing for a consecutive four-year period will bear interest at the rate of 3% for the four-year period and the remaining six years of the repayment period.

If the lending school determines that the borrower will either fail to complete the course of study or fail to establish full-time employment as faculty following graduation from the program, the loan will bear interest on the unpaid balance at the prevailing market rate.

The prevailing market rate is determined by the Treasury Department and is published quarterly in the Federal Register. The rates are fixed. Refer to the HHS, Office of Finance web site for information on the "consumer interest” rates.

Important Note: The borrower is responsible for submitting verification of employment to the lending school in order to determine the interest rate applicable to the unpaid loan balance.

DEATH AND DISABILITY

1. Death

Upon the death of a borrower, the school must submit documentation to the Division of Nursing (NFLP), Parklawn Building, Room 9-36, 5600 Fishers Lane, Rockville, Maryland 20857. The school retains the documentation in the borrower's file for audit purposes. The school must report the amount of the loan cancelled on its Annual Operating Report. The Secretary of HHS or a designee will cancel the unpaid balance of the NFLP loan and accrued interest of a loan upon submission to the school of a death certificate or other official proof of death of the borrower. The school will be formally notified of the Secretary's decision and must retain the written notification of the decision on file for audit and other review purposes.

2. Permanent and Total Disability

A borrower may be entitled to cancellation of any remaining payment of the NFLP loan in the event of permanent and total disability. Permanent and total disability is defined as unable to engage in gainful employment of any kind because of a medically determined impairment that is expected to continue for a long and indefinite period of time or to result in death. The Secretary of HHS or a designee will make this determination based on medical certification submitted by the borrower supporting the borrower's disability and will cancel the NFLP loan upon approval.

To claim cancellation for disability, a borrower must submit a formal request to the lending school that awarded the loan along with the following documentation:

• date entered and date graduated or date studies terminated;
• total amount of loans obtained;
• amount of unpaid balance;
• nature and date of onset of the disability;
• employment history prior to disability;
• statement of financial support; and
• current medical examination and/or treatment.

The medical report must be sufficiently detailed to provide for a comprehensive review to determine the nature, duration, and extent of the impairment and prognosis. Supporting documentation must include history of illness, medical examination(s), inpatient and outpatient treatments, current medications, and copies of all pertinent past medical records and a prognosis and rehabilitation plan. A signed and dated statement must accompany the medical documentation from the borrower's physician documenting permanent and total disability according to the definition above. The lending school must obtain from the borrower consent for release of information allowing the release of any required information on the disability to the HHS. The school will be formally notified of the Secretary's decision and must retain the written notification of the decision on file for audit and other review purposes. The school must report the amount of the loan cancelled on its Annual Operating Report.

IMPORTANT NOTE: The school does not have the authority to cancel loans based on permanent and total disability. This authority remains with HHS.

The school must submit documentation of disability to the Division of Nursing (NFLP), Parklawn Building, Room 9-36, 5600 Fishers Lane, Rockville, Maryland 20857. A disability checklist is provided as EXHIBIT H for the school in obtaining the required documentation to submit claims for permanent and total disability. This checklist should not be used in lieu of obtaining the required documentation described above.

DEFERMENT OF LOAN REPAYMENT

Deferment options under the NFLP are limited.

• NFLP borrowers who are ordered to active duty as a member of a uniformed service of the United States (Army, Navy, Marine Corps, Air Force, Coast Guard, the National Oceanic and Atmospheric Administration Corps, Peace Corps, or the U.S. Public Health Service Commissioned Corps) are eligible for deferment for up to 3 years. A borrower who voluntarily joins a uniformed service is not eligible for deferment, nor is a borrower who is employed by one of the uniformed services in a civilian capacity.
  
  
• NFLP borrowers that graduate and are employed, and decide to return to a graduate nursing education program to pursue a doctoral degree to further their preparation as nurse faculty may request deferment of payment for up to 3 years.
  
  
• NFLP borrowers that graduate and participate in post-doctoral programs may request deferment of payment for up to 3 years.

The school may not put a borrower into deferment status unless the borrower submits a deferment request form (EXHIBIT J). Deferments are not automatic. Borrowers must file deferment forms for each period of deferment and request deferments at least 30 days before the beginning of:

• the activity that makes the borrower eligible for deferment; or
• the repayment period (i.e., the due date of the first payment) if the borrower is beginning the activity during the grace period.

Deferment periods are excluded from the 10-year repayment period. For example, a borrower who has used three years of deferments still has a total of 10 years not 7 years to repay the NFLP loan.

The borrower is responsible for informing the lending school of the end of the deferment period, and the school is responsible for placing the borrower back in repayment following the end of the deferment.

FORBEARANCE

A lending school may, based on its discretion, place a borrower’s NFLP loan in forbearance when extraordinary circumstances such as poor health or hardships temporarily affect the borrower's ability to make scheduled loan repayments. Forbearance is limited to situations in which the borrower clearly intends to repay the NFLP loan obligation but is temporarily unable to comply with the existing repayment schedule. See Collections under the Fiscal Management web site for additional information on forbearance. During periods of forbearance, the borrower's obligation to make payments on interest and principal may be either reduced or eliminated. Interest on the loan continues to accrue but is not payable during this period.

A borrower must request forbearance by submitting a completed Request for Forbearance form (EXHIBIT L) to the school. The school must notify the borrower in writing of its approval or denial of the forbearance request and document that decision in the borrower's file.

Forbearance periods may be up to 6 months each. A school may grant a borrower no more than 2 forbearance periods without seeking the prior approval of HHS. Periods of forbearance are not excluded from the borrower's 10-year repayment period.

INSTITUTIONAL RESPONSIBILITY IN REPAYMENT PROCESS

See Collection under the Fiscal Management web site for information on accounting requirements, debt collection requirements (e.g., due diligence), cash management requirements, program monitoring and audits.

1. Exit Interview

The school must conduct and document an exit interview with its borrowers (individually or in groups). The school has the discretion in deciding which office (e.g., financial aid, fiscal, loan collection, or dean's) will be responsible for the exit interview, and for determining the specific format of the exit interview as long it obtains the following documentation:

• Evidence that the borrower was reminded of his or her rights and responsibilities concerning the terms and conditions of the loan, and
• the borrower's current address, telephone number, and other information needed for loan collection. (See EXHIBIT K)

If a borrower fails to appear for an exit interview, the school must attempt to conduct the exit interview by mailing the exit interview information to the borrower and requesting that a copy of the repayment terms and the rights and responsibilities form or statement be signed and dated, the personal information form be completed and dated, and these items be returned to the school. If the borrower returns the information as requested, this will document that the exit interview was conducted. See Collections under the Fiscal Management web site for more information on exit interviews.

DEFINITIONS

“Accreditation” is a nongovernmental process conducted by representatives of postsecondary institutions and professional groups. A program may be accredited by a recognized body or bodies, or by a State agency, approved for such purpose by the Secretary of Education and when applied to a hospital, school, college or university (or unit thereof) means a hospital, school, college or university (or unit thereof) which is accredited by a recognized body or bodies, or by a State agency, approved for such purpose by the Secretary of Education, as defined in section 801(6) of the Public Health Service (PHS) Act.

Two forms of accreditation are recognized: one is institutional accreditation and the other is professional or specialized accreditation. A collegiate school of nursing must be accredited by a recognized body or bodies (i.e. Commission on Collegiate Nursing Education and/or National League of Nursing) or State agency, approved by the Secretary of Education for the purpose of conducting nursing education.

The Secretary of Education publishes a list of recognized accrediting bodies, and of State agencies, which the Secretary of Education determines to be a reliable authority as to the quality of education offered at U.S. Department of Education Web site.

“Advanced Education Nursing Program” means a program of study in a collegiate school of nursing or other eligible entity which leads to a master's and/or doctoral degree and which prepares nurses to serve as nurse practitioners, clinical nurse specialists, nurse-midwives, nurse anesthetists, nurse educators, nurse administrators, or public health nurses, or in other nurse specialties determined by the Secretary to require advanced education.

“Certification” means a process by which an agency or organization validates, based upon predetermined standards, an individual nurse’s qualifications and knowledge for practice in a defined functional or clinical area of nursing.

“Clinical Nursing Specialty” means a specific area of advanced clinical nursing theory and practice addressed through formal instruction to prepare advanced education nurses. Clinical nursing specialties prepare the nurse to provide direct patient/client nursing care to individuals or to population groups. A nurse completing a course of study in a clinical nursing specialty is expected to be eligible for a national certification(s) or state certification(s), when available, following graduation or required experience.

“Clinical Nursing Specialty Program” means a formal graduate level education program that provides expertise within a specialty area of nursing practice. In addition to the delivery of direct patient/client care, the role may include consultative, educational, research and/or administrative components. A graduate degree is the minimum requirement for clinical nurse specialty programs.

“Collegiate School of Nursing” means a department, division, or other administrative unit in a college or university which provides primarily or exclusively a program of education in professional nursing and related subjects leading to the degree of bachelor of arts, bachelor of science, bachelor of nursing, or to an equivalent degree, or to a graduate degree in nursing, or to an equivalent degree, and including advanced training related to such program of education provided by such school, but only if such program, or such unit, college or university is accredited, as defined in section 801(3) of the PHS Act.

“Continuing Students” are NFLP loan recipients enrolled the previous academic year and are continuing enrollment in the education program offered by the institution.

“Culturally and Linguistically Appropriate Services” means health care services that are respectful of and responsive to cultural and linguistic needs.

“Cultural Competence” means a set of academic and interpersonal skills that allow an individual to increase their understanding and appreciation of cultural differences and similarities within, among and between groups. This requires a willingness and ability to draw on community-based values, traditions, and customs and to work with knowledgeable persons of and from the community in developing targeted interventions, communications, and other supports.

“Culturally Competent Program” means a program that demonstrates sensitivity to and an understanding of cultural differences in program design, implementation and evaluation.

“Cultural Diversity” means differences in race, ethnicity, language, nationality, or religion among various groups within a community, an organization, or a nation.

“Distance Learning” means electronic media are used to deliver education content when the learner and teacher are separated by distance. An electronic medium may be a computer, World Wide Web technologies, teleconferencing, television, or CD ROM/DVD.

“Doctoral Program in Nursing” means a program of instruction beyond the baccalaureate and master’s degrees in nursing (e.g. PhD, DNS, DSN, DNSc, and DNP). Doctoral programs in nursing fall into two principal types: research focus and practice focus.

“Education Component” consists of education courses, preceptor and/or supervised teaching practica identified within the curriculum to prepare students to become nurse faculty.

“Full-Time Student” means a student who is enrolled on a full-time basis as defined by the Registrar’s office at the institution.

“Graduate” means an individual who has successfully completed all institutional requirements necessary to be granted a degree.

“Minority” means an individual whose race or ethnicity is classified as American Indian or Alaska Native, Asian, Black or African American, Hispanic or Latino, Native Hawaiian or Pacific Islander.

ETHNICITY:
Hispanic or Latino: A person of Cuban, Mexican, Puerto Rican, South or Central American, or other Spanish culture or origin, regardless of race. The term, "Spanish origin," can be used in addition to "Hispanic or Latino."
RACE:
American Indian or Alaska Native: A person having origins in any of the original peoples of North, Central, or South America, and who maintains tribal affiliation or community attachment.
Asian: A person having origins in any of the original peoples of the Far East, Southeast Asia, or the Indian subcontinent including, for example, Cambodia, China, India, Japan, Korea, Malaysia, Pakistan, the Philippine Islands, Thailand, and Vietnam.
Black or African American: A person having origins in any of the black racial groups of Africa. Terms such as "Haitian" or "Negro" can be used in addition to "Black or African American."
Native Hawaiian or Other Pacific Islander: A person having origins in any of the original peoples of Hawaii, Guam, Samoa, or other Pacific Islands.
White: A person having origins in any of the original peoples of Europe, the Middle East, or North Africa.

“New Students” are students who have never received NFLP support.

“Nurse Administrator” means a registered nurse who has successfully completed a master’s and/or doctoral degree program of study designed to prepare nurses for leadership positions in administration in a variety of health care systems.

“Nurse Anesthetist” means a registered nurse who has successfully completed a nurse anesthetist education program.

“Nurse Educator” means a registered nurse who is prepared through master’s and/or doctoral education in nursing to transfer knowledge about the science and art of nursing from the expert to the novice in a variety of academic, clinical and lay educational settings with attention to life long learning needs of professional nursing students and advanced practice nurses and students.

“Nurse-Midwife” means a registered nurse educated in the two disciplines of nursing and midwifery that successfully complete a nurse-midwifery education program accredited by the Division of Accreditation of the American College of Nurse-Midwives (ACNM).
Following ACNM Certification Council (ACC) certification, the nurse-midwife has ability to provide independent management of primary health care for women in the context of family-centered care focusing particularly on pregnancy, childbirth, the postpartum period, care of the newborn, and the family planning and gynecological needs of women within a health care system that provides for consultation, collaborative management or referral as indicated by the health status of the client. This ability includes the: Assessment of the health status of women and infants, through health and medical history taking, physical examination, ordering, performing, supervising and interpreting diagnostic tests and making diagnoses; Institution and provision of continuity of primary health care to women and referral to other health care providers as appropriate; Prescription of pharmacological and non-pharmacological therapeutics, consistent with current standards of care; Provision of instruction and counseling to individuals, families, and groups in the areas of promotion and maintenance of health and disease prevention by actively involving these individuals in the decision making and planning for their own health care; and Collaboration with other health care providers and agencies to provide and coordinate services to individual women, children, and families.

“Nurse Practitioner” means a registered nurse who has successfully completed a Nurse Practitioner Program, as defined below, who can deliver primary and acute care services in a variety of settings, such as homes, ambulatory care facilities, long-term care facilities, and acute care facilities, using independent and interdependent decision making with direct accountability for clinical judgment. The health care services to be provided include: Assessment of the health status of individuals and families through health and medical history taking, physical examination, ordering, performing, supervising, and interpreting diagnostic tests and making diagnoses; Management of acute episodic and chronic illnesses; Institution and provision of continuity of primary health care to individuals and families and referral to other health care providers when appropriate; Prescription of treatments including pharmacological and non-pharmacological therapeutics, consistent with current standards of care; Provision of instruction and counseling to individuals, families, and groups in the areas of promotion and maintenance of health and disease prevention, by actively involving these individuals in the decision making and planning for their own health care; and Collaboration with other health care providers and agencies to provide, and where appropriate, coordinate services to individuals and families.

“Nurse Practitioner or Nurse-Midwifery Program” means an educational program of study, as defined by the institution, (although students may be progressing through the program on a full-time or part-time basis), which meets the Guidelines prescribed herein. The program's objective is the education of nurses who will, upon completion of their studies in the program, be qualified to effectively provide primary care in a variety of settings, including in homes, ambulatory care facilities, long-term care facilities, acute care, and other health care settings.

“Preceptorship” means a clinical learning experience in which the student is assigned to a faculty member or with oversight by program faculty to a designated preceptor who is a nurse practitioner or nurse-midwife or other health professional for specific aspects of the clinical learning experience. The preceptorship provides the student with practice experiences conducive to meeting the defined goals and objectives of the particular clinical course. The preceptor is responsible for the daily teaching and assignment of individuals to be cared for, supervision, and participation in the evaluation of the nurse practitioner or nurse-midwifery student. The preceptor teaches, supervises, and evaluates the student and provides the student with an environment that permits observation, active participation, and management of primary health care. Before and during this preceptorship, the program faculty visit and assess the clinical learning sites and prepare the clinical faculty/preceptors for teaching their students.

“Program” means a program of study that consists of a combination of identified courses and other educational or training experiences at a specified academic level, the sum of which provides the required competence(s) to practice.

RELEASE OF INFORMATION

A. General Public Information: HHS makes available routinely to interested persons a report listing programs awarded. Information made available includes the title of the project, school of nursing, project director, and the amount of the award.

The Freedom of Information Act (5 USC 552) and the associated Freedom of Information Regulations of HHS (45 CFR Part 5) require the release of certain information about programs upon request. Release does not depend upon the intended use of the information.

Generally available for release upon request are all funded applications; annual operating report of program; and final reports of any review or evaluation of program performance conducted or caused to be conducted by the Department. Release is subject to deletion of material that would affect patent or other valuable rights.

B. The Privacy Act: The Privacy Act of 1974 (5 USC 552a) and the associated Privacy Act Regulations (45 CFR part 5b) give individuals the right of access, upon request, to information in the records concerning themselves. The Act provides a mechanism for correction or amendment of such information. It also provides for the protection of information pertaining to an individual, but it does not prevent disclosure if release of such information is required under the Freedom of Information Act. If a Privacy Act system of records applies, the name and number of the system will be identified.

If applicable, the Privacy Act requires that a Federal agency requesting information from an individual advise the individual of the agency’s authority to make the request; whether compliance with the request is voluntary or mandatory; how and why the information will be used both inside and outside the agency; and what the consequences are for the individual of failing to provide all or any part of the requested information.

HHS requests the information described in these instructions under authority of the PHS Act as amended (42 USC 289a-1). Although provision of the information requested is entirely voluntary, it is necessary for making award decisions. A lack of sufficient information may hinder HHS’s ability to review applications. HHS will use this information and may disclose it outside the Department, as permitted by the Privacy Act under the applicable system of records.

C. Government Use of Information: In addition to being used in evaluating applications, other routine uses of information include disclosure to: the public as required by the Freedom of Information Act; the Congress; the National Archives and Records Service; the Bureau of the Census; law enforcement agencies upon their request; the General Accounting Office; and courts by order. It may also be disclosed outside of the Department if necessary to:

1. a cognizant audit agency for auditing;
2. the Department of Justice as required for litigation;
3. respond to an inquiry from a Congressional office about the record of an individual made at the request of that individual;
4. qualified experts not within the definition of Department employees as prescribed in Department regulations (45 CFR Part 5b.2, Purpose and Scope) for opinion as a part of the application review process;
5. a Federal agency, in response to its request, in connection with the letting of a contract, or the issuance of a license, award or other benefit by the requesting agency, to the extent that the record is relevant and necessary to the requesting agency’s decision on the matter;
6. individuals and organizations deemed qualified by the HHS to carry out specific research related to the review and award process of the HHS;
7. organizations in the private sector with whom HHS has contracted for the purpose of collating, analyzing, aggregating, or otherwise refining records in a system. Relevant records will be disclosed to such a contractor. The contractor shall be required to maintain Privacy Act safeguards with respect to such records; and
8. the applicant organization in connection with performance or administration under the terms and conditions of the award