Pick the wrong plan and a resident overpays by roughly $170 a month. Stay on the wrong one into attendinghood and, over a full timeline, the plan choice alone can move your total cost by about $45,000. The plans look interchangeable on the enrollment screen — three acronyms, similar descriptions. They are not interchangeable, and for physicians the differences compound, because no other profession swings from $65,000 to $280,000 in a single July.
Income-driven repayment is the chassis under every physician loan strategy. If you are pursuing PSLF, your IDR plan determines what each of your 120 qualifying payments costs. If you are not pursuing PSLF, your IDR plan is your hardship insurance and, at the extreme, your path to taxable forgiveness after 20 or 25 years. Either way, the formula details matter at physician incomes in a way they barely matter at the median American income.
One caution before the comparison: IDR has spent the last several years in legal and regulatory turmoil, and plan availability in 2026 is genuinely unstable. This article explains how each plan's formula works and runs the physician math; where a plan's current status is uncertain, it says so explicitly rather than guessing.
How every IDR plan works, in one paragraph
All IDR plans share a skeleton: your payment is a percentage of your discretionary income, defined as your adjusted gross income minus a multiple of the federal poverty guideline for your household size. You recertify income annually, the payment recalculates, and any balance remaining at the end of the plan's term (20 or 25 years) is forgiven — taxably, unless PSLF gets you there first, tax-free, at 120 qualifying payments. The plans differ in three places: the percentage, the poverty-line multiple, and whether the payment is capped at the 10-year Standard amount.
For all worked examples below we assume a single physician, household of one, with $230,000 in at 6.8%, and — for clean arithmetic — a one-person federal poverty guideline of $16,000, a hair above the actual 2026 figure of $15,960. The guideline updates each January; the structure of the comparison does not change.
The three plans, side by side
| PAYE | SAVE | IBR (newer borrowers) | IBR (older borrowers) | |
|---|---|---|---|---|
| Payment formula | 10% of income above 150% of poverty line | 10% (grad debt) above 225% of poverty line | 10% above 150% | 15% above 150% |
| Payment cap | 10-year Standard amount | No cap | 10-year Standard amount | 10-year Standard amount |
| Forgiveness term | 20 years | 20–25 years | 20 years | 25 years |
| Counts toward PSLF | Yes | Historically yes — currently disrupted | Yes | Yes |
| Status in 2026 | Closed to new enrollment; sunsets July 2028 | Terminated; enrollees must switch plans | Open | Open |
PAYE (Pay As You Earn) is the historical physician favorite: 10% of discretionary income, a 20-year term, and — critically for high earners — a cap. Your PAYE payment can never exceed what the 10-year Standard payment would have been on your balance when you entered the plan. PAYE was closed to new enrollment in 2024, then reopened after the SAVE litigation began — but the July 2025 law put it on a sunset track: closed to new enrollment as of July 2026, eliminated entirely on July 1, 2028, when remaining enrollees move to IBR or the new Repayment Assistance Plan. Borrowers already on PAYE can stay through the wind-down; anyone not on it now should not build a strategy on getting in.
SAVE (Saving on a Valuable Education) offered the most generous formula ever attached to federal loans — a 225%-of-poverty-line exclusion and a full subsidy of unpaid monthly interest, meaning balances never grew. It was blocked by a federal injunction in 2024, the courts ultimately struck it down, and the July 2025 law terminated it by statute. Borrowers were parked in a forbearance during which months did not count toward PSLF (buyback can later cover those months if they fall within qualifying employment), and remaining SAVE enrollees are now being directed to choose IBR or the new Repayment Assistance Plan — servicers began sending 90-day switch notices in July 2026, and the wind-down runs no later than July 1, 2028.
IBR (Income-Based Repayment) is the tortoise: less generous, but written directly into statute, which has made it the most litigation-proof option on the menu. Borrowers who took their first federal loan on or after July 1, 2014 get the newer terms (10%, 20-year forgiveness); older borrowers get 15% and 25 years. Like PAYE, IBR caps your payment at the 10-year Standard amount — though IBR also requires you to demonstrate a partial financial hardship to enroll, a test high-earning attendings can fail if they wait too long to get in.
Borrowers whose first loans disburse on or after July 1, 2026 face a different menu entirely — the July 2025 law replaces the IDR lineup with the Repayment Assistance Plan (RAP) for new borrowing: 1–10% of AGI by income band, a $10 minimum payment, an unpaid-interest waiver, PSLF eligibility, and 30-year forgiveness. Physicians whose loans all predate July 1, 2026 keep access to IBR, PAYE, and ICR until July 1, 2028; after that, PAYE and ICR sunset and existing borrowers use IBR or switch to RAP. Anyone still borrowing should confirm which regime their newest loans fall under at StudentAid.gov.
Scenario 1: The resident at $65,000
Here is what each plan charges a PGY-2 with a $65,000 salary, our $16,000 poverty-line assumption, and a one-person household.
Example calculation
Resident payments by plan. Discretionary income at 150% of the poverty line: $65,000 − $24,000 = $41,000. At 225%: $65,000 − $36,000 = $29,000.
- SAVE: 10% × $29,000 = $2,900/year ≈ $242/month
- PAYE / newer IBR: 10% × $41,000 = $4,100/year ≈ $342/month
- Older IBR: 15% × $41,000 = $6,150/year ≈ $512/month
The spread between the best and worst available plan is $170–$270 a month — $2,000 to $3,200 a year — for an identical loan, identical income, and identical PSLF credit per payment.
Two observations physicians should sit with. First, every one of these payments buys the same thing for PSLF purposes: one qualifying month. A $242 payment and a $512 payment advance the count identically, which is why plan selection during training is close to free money. Second, none of these payments covers the roughly $1,303 of monthly interest a $230,000 balance accrues at 6.8%. On plans without an interest subsidy, the balance grows through residency — which is irrelevant if you reach PSLF forgiveness, and very relevant if you later abandon it. SAVE's full interest subsidy died with the plan; IBR and PAYE do not waive unpaid interest on grad-school debt, so expect growth at resident income. The new RAP (loans made on or after July 1, 2026) does waive unpaid interest — one of its few clear advantages.
Interns often have a powerful one-time opportunity: an IDR application filed early in PGY-1 can be based on a tax return showing half a year of medical-student income — often producing a $0 calculated payment. A $0 payment at a qualifying employer is a fully qualifying PSLF month. File early; do not wait for the first loan bill.
Scenario 2: The attending at $280,000
The same physician signs an attending contract at $280,000. Now the formulas diverge in a different place — the cap.
Example calculation
Attending payments by plan. Discretionary income at 150%: $280,000 − $24,000 = $256,000. At 225%: $280,000 − $36,000 = $244,000. The 10-year Standard payment on the original $230,000 at 6.8% — the cap benchmark — is about $2,647/month.
- SAVE: 10% × $244,000 ≈ $2,033/month (no cap, but the formula lands below it)
- PAYE / newer IBR: 10% × $256,000 ≈ $2,133/month (under the cap)
- Older IBR: 15% × $256,000 ≈ $3,200/month → capped at $2,647/month
The older-IBR physician pays $514/month more than the PAYE physician — over $6,100/year — for the same monthly PSLF credit.
The cap matters more as income climbs. At $400,000 of household income, an uncapped 10% formula produces a payment north of $3,100/month, while capped plans hold at the Standard amount calculated on your original balance. For physicians with very high attending incomes, modest balances, or high-earning spouses, the cap is frequently the deciding feature — and it is why an uncapped plan that looks cheapest at $65,000 is not automatically cheapest at the income you will actually spend most of your repayment years earning.
Run the full PSLF timeline and the plan choice compounds:
Example calculation
Total 120-payment cost, four resident years plus six attending years.
- PAYE / newer IBR: 48 × $342 + 72 × $2,133 ≈ $170,000
- Older IBR: 48 × $512 + 72 × $2,647 ≈ $215,200
Same forgiveness, same timeline, roughly $45,000 difference in what the physician pays to get there. Plan selection is one of the few five-figure decisions in medicine you can execute with a single form.
Married physicians: the filing-status lever
For married physicians, the IDR formula has a second input that can dwarf the plan choice: whose income counts. Under PAYE and IBR, filing taxes separately generally lets you exclude your spouse's income from the payment calculation; filing jointly includes it. A resident married to a $300,000-earning spouse can see their calculated payment differ by thousands of dollars a month depending on filing status — against which the cost of married-filing-separately (lost credits, higher brackets, IRA complications) must be weighed each year. The mechanics deserve their own article; for now, know that if you are married, no IDR comparison is complete until it is run both ways.
The 20-year backstop: what forgiveness costs without PSLF
Every IDR plan carries its own forgiveness clock independent of PSLF: 20 years of payments on PAYE and newer IBR, 25 on older IBR. Two differences from PSLF matter enormously. First, the term is in years, not qualifying-employer payments — for-profit employment counts. Second, the forgiven balance is generally treated as taxable income in the year of forgiveness. A physician forgiven $150,000 of remaining balance in the 35% bracket owes roughly $52,500 to the IRS that April. A temporary exclusion for IDR forgiveness existed in recent years; its status for forgiveness occurring after 2025 has been part of the broader legislative churn — check the current rule before building a 20-year plan on either assumption.
For most attendings this backstop rarely binds — at $280,000, a 10% formula produces payments large enough to amortize a $230,000 balance well before year 20. Where it binds is large balances with modest incomes: part-time clinicians, academic or public-health careers outside PSLF eligibility, or physicians whose household size pushes discretionary income down. If your realistic path ends in taxable forgiveness, model the tax bill as a balloon payment and save toward it deliberately.
Quick takeaway
For PSLF physicians, the IDR plan decides the price of forgiveness. For everyone else, it decides the slope of the debt. In both cases the formula — percentage, poverty-line multiple, cap — is the entire game, and the cheapest formula at resident income is not always cheapest at attending income.
Choosing: PSLF borrowers vs everyone else
If you are pursuing PSLF, the objective is simple: minimize the sum of 120 payments. That means the available plan with the lowest formula at your projected incomes — accounting for the cap once attending income arrives — and an unbroken streak of qualifying months. Stability has independent value here: a plan that gets enjoined mid-stream and parks you in non-qualifying forbearance costs you months at the back of your timeline, each worth roughly an attending-level payment. In an unstable plan environment, a slightly more expensive plan with statutory footing can genuinely beat a cheaper one that becomes a litigation casualty.
If you are not pursuing PSLF, IDR is either a bridge (low payments through training, then refinance or aggressive payoff as an attending) or a destination (20–25 years to taxable forgiveness — rarely optimal at attending incomes, since the formula payment at $280,000 retires most physician balances before the term ends anyway). Bridge users should weight the interest treatment heavily, since every dollar of unsubsidized accrual is real debt they will eventually repay.
Important
Whatever you choose, do not change plans casually mid-PSLF. Plan switches can trigger processing forbearances, recalculated payments, and — historically — capitalization of accrued interest. Every month spent in processing limbo is a month that may not count. Switch when the math clearly justifies it, early in your timeline when possible, and document everything.
Common questions
Which IDR plan should a resident pursuing PSLF pick in 2026?
The cheapest plan currently open to new enrollment that reliably generates qualifying payments — verified on studentaid.gov the week you apply, not from an article, including this one. The formula logic in this comparison tells you how to evaluate whatever the current menu is: lowest percentage, highest poverty-line exclusion, capped if your attending income will be high, and stable enough to keep your count moving.
I'm on SAVE. Did my forbearance months count toward PSLF?
Months in the SAVE litigation forbearance generally did not count toward PSLF, which is the painful part — though buyback-type remedies for some affected months have existed. Check your payment count on studentaid.gov against your own records, and confirm the current remedy options before assuming the months are lost or saved.
Does switching from IBR to PAYE restart my PSLF clock?
No. The 120-payment count is plan-agnostic — qualifying payments made under any qualifying plan accumulate in one count. The risks of switching are the transition mechanics (processing forbearance, interest capitalization), not the count itself.
My servicer put me on Extended repayment after consolidation. Is that an IDR plan?
No, and this is a common and expensive trap. Extended and Graduated plans are not income-driven and do not count toward PSLF. If you consolidated and were defaulted onto one of these, you must actively select an IDR plan. Payments made on Extended feel like progress and accrue nothing toward forgiveness.
What happens to my payment when my income jumps from $65,000 to $280,000?
Nothing, until you recertify. Your payment is based on your most recent income documentation, so the resident-rate payment typically persists until your next annual recertification date — a legitimate, rules-compliant feature of the system. Time your recertification calendar carefully around the transition, and never report the new income early by accident. The strategy around that transition year is its own topic.
What to do next
- Pull your loan inventory at studentaid.gov: loan types, disbursement dates, and current plan. Your first-loan date determines which IBR terms — and which 2026 transition rules — apply to you.
- Check which IDR plans are open to new enrollment right now on studentaid.gov, not from any article.
- Calculate your payment under each available plan at your current income and at your realistic attending income, including the 10-year Standard cap on your original balance.
- If married or engaged, run every calculation twice — jointly and separately.
- If pursuing PSLF, favor the cheap-and-stable plan, enroll, and submit an employment certification in the same month.
- Calendar your recertification date, especially if an income jump is coming.
The forgiveness side of this decision — employer rules, payment counting, certification — is covered in our complete PSLF guide. If you want these formulas run against your actual loans, household, and contract instead of this article's example physician, the PSLF Guardian inside Attending Financial does exactly that, and re-checks the plan landscape so you do not have to track the litigation yourself.