Social Work, Education Still Fighting for Higher Loan Caps

More than a week after the Department of Education expanded the list of degree programs eligible for higher loan limits after the One Big Beautiful Bill Act took effect on July 1, several trade associations and legal experts say the latest expansion is not enough.

The expanded list followed a federal district court order that temporarily stayed the department’s more narrow definition. Now ED has deemed 29 programs professional, up from 11—including health-care fields like nursing and physician assistantship (both of which had trade associations that sued the department over its definition). Other degrees for careers in education, social work, accounting and architecture still did not make the cut.

Advocates representing those programs say that while the judge gave the department authority to write the updated list, the court order also laid out clear instructions for how it should be done. And from their perspective, ED didn’t follow those directions. But the trade associations aren’t giving up without a fight and hope to use legislation or further litigation to ensure their students can get access to the $50,000 annual limit for professional programs, rather than the $20,500 limit for all other graduate degrees.

“Without the addition of social work, the list of professional degree programs remains incomplete,” said Matt Hooper, vice president for communications at the Council for Social Work Education.

The department could voluntarily expand the list in response to the pushback, though that seems unlikely. Education Under Secretary Nicholas Kent has repeatedly said he intends to appeal the court’s ruling, though a motion has yet to be filed. Kent also told Inside Higher Ed that “while [the department] disagrees with the court’s analysis regarding [its] definition of professional degree programs … the department is complying with the order.”

Other avenues of relief also appear unlikely to pay off for advocates. For example, D.C. District Court Judge Beryl Howell, who issued the preliminary injunction, could rule on whether ED is complying with the injunction or explicitly state that certain programs must be deemed professional. But that is unlikely unless the plaintiffs file a motion, and experts say that probably won’t happen because the case was filed by nurses and physician associates—two career fields that did make the list. And multiple groups said they hope that Congress will act to override the department’s regulations, though that will take time, especially in a political climate dominated by the midterm elections and a looming Sept. 30 federal budget deadline.

Experts say the most likely means to get programs like social work and education added to the list would be for those trade associations to sue. (Two ongoing lawsuits in Maryland and Massachusetts are also challenging the loan limits. In either case, the judge could issue a ruling that directly states which programs must be considered professional.)

For now, tens of thousands of students in programs that appear to meet the standards of OBBBA but didn’t make the cut at ED will only get access to $20,500 a year in federal loans, and colleges will have to either lower their costs, provide more institutional aid or help students find private lenders to cover the cost. And even for programs that did make the cut, the temporary nature of the injunction is making it difficult for colleges to decide whether to limit how much students can borrow. (The law that put the loan limits in place also gave colleges the ability to limit lending, an authority that institutions have long pushed for.)

A 3-Pronged Test

The terminology and lists of programs up for debate first came to be last summer under OBBBA, the sweeping tax and spending megabill that included the largest overhaul to higher ed policy in decades. All students pursuing master’s and doctoral degrees could previously borrow up to a program’s cost of attendance, but Congress ended that loan program, effective this month.

Under the law, a professional degree must:

• Lead students to begin practice in a specific profession
• Signify a level of skill beyond that of a bachelor’s degree
• Generally require licensure

The Department of Education then used its regulatory process to add further criteria, narrowing which programs qualified as professional. Trump officials said the definition was aimed at executing Congress’s goal of limiting spending and reining in college debt. But Howell didn’t agree and found that ED didn’t have the authority to change the definition. Howell then directed the agency to use Congress’s three prongs to determine which programs qualify.

Several higher ed legal experts and government affairs representatives believed programs like master’s degrees in education and social work would be eligible for higher loans following the court order. The programs go beyond a bachelor’s degree. They are needed for particular jobs, like being a principal, school counselor or clinical social worker. And the professions require licensure.

But Jacqueline King, a consultant for federal advocacy at the American Association of Colleges for Teacher Education, said she wasn’t surprised when the department’s updated guidance didn’t include those programs.

The department had already excluded a master’s in education from its original list, saying that while some states require teachers to obtain a master’s degree to maintain their license after a certain period of time, no state requires the degree for an entry-level position. ED also added that positions like a principal or school counselor would be considered career advancement; Congress’s standards refer to “entrance into a specific profession or for licensure.”

King said the department’s rationale didn’t make any sense.

“It’s like saying you can be a certified nursing assistant with less than a bachelor’s degree, so therefore nursing should be excluded,” she said. ”But because the department had articulated that rationale previously, I anticipated that they might continue to apply that flawed logic, and that appears to be what happened.”

The Education Department did not directly explain why programs like education and social work were not included in its most recent guidance. It also did not respond to Inside Higher Ed’s questions about how it applied the test.

Uncertainty Remains

Tres Cleveland, a partner and co-chair of the higher education practice group at Thompson Coburn LLP, said the list reflects the department’s ongoing push to keep the definition of professional programs as narrow as it can despite the injunction.

“If you look in the department’s final rule, there was pushback on some professions where licensure is required in some states but not all. To me, in those instances, the department was taking a hard line. The three-part test says that ‘licensure is generally required.’ It certainly doesn’t say licensure is required in all 50 states,” he explained. “But I don’t know that the department will bend on that.”

Instead, Cleveland anticipates programs will either have to work behind the scenes to try and convince the department to make further changes or file more lawsuits.

In the meantime, financial aid administrators warn that the shifting definitions and uncertainty about what’s ahead put both students and administrators in a difficult position.

“My first reaction wasn’t even about who was on the list and who was not; it was just about its temporary nature,” said Jill Desjean, director of policy analysis at the National Association of Student Financial Aid Administrators, adding that she’s focused on figuring out the operational side of things and what happens if students in certain programs end up with more or less loan access as court proceedings continue to unfold.

The last thing financial aid administrators want, Desjean said, is for students to think they can finance their education going into a degree program, only to learn midway through that they don’t have the funding they need.

“Some debt without a degree is the worst position to be in,” she said. “So we really just want to make sure that students are fully aware and not just like, ‘Woo hoo, there’s a new loan limit!’ But rather that this isn’t a full-on victory right now. This is a temporary, potential victory.”