Grad Plus loans for everyone will disappear, including for medical students. Med students who need more than $28/year will be forced into the private loan market–which offers fewer borrower protections and fewer options for loan repayment. I can also foresee private lenders demanding that private student loans become non-dischargable just like federal student loans are now.
Maybe the cost of undergraduate education can be reduced, but the costs of medical education are very inflexible and do not respond to the economies of scale. It costs about $90K per year to educate a single medical student. (Last year for data was 2006 so I expect it costs more now.) Med schools that are heavily endowed (Harvard, Stanford, UMichigan, etc) or public schools that receive large state subsidies may be able to afford to offer tuition discounts to their students, but less well endowed private schools and most public state schools simply cannot.