In some places, tuition fees are simply too high.
Last year, federal lawmakers limited the amount of money that students pursuing advanced degrees can borrow from the government, and high tuition costs were one of the main reasons why. They believed that the old federal student loan rules — which allowed people to borrow the entire cost of tuition plus money to cover living expenses — encouraged institutions to drive up their prices.
But the legislature went further: different credit limits apply to different graduate programs. Students pursuing so-called professional degrees can borrow a total of up to $200,000 to acquire their qualifications. Other programs have a cap of $100,000.
Nurses who pursued advanced degrees did not end up in the professional category. The result is a kind of split-screen situation between different institutions that train them.
Take two schools in Ohio that we examined using data from the Federal College Scorecard, a consumer tool with information about thousands of college programs that the Department of Education manages. At Case Western Reserve University, the average federal student loan debt for nursing master’s degree graduates was $124,668 in 2019 and 2020, available figures show. At Kent State University, just about 35 miles away, it cost just $37,500.
Given the new $100,000 loan cap, Case has a big problem here. Does it deserve that?
Case has a few drawbacks that aren’t his fault. It is private and therefore does not receive the same government subsidies as Kent State.
This also applies to Cleveland, where the cost of living is higher. When graduate students start school, they may leave the job market and have no spouse or relatives to help pay them.
Case estimates his nursing students’ food, housing, transportation and personal expenses are at least $24,512 per academic year. But in addition to the $100,000 loan limit for nursing students, the law imposes an annual limit of $20,500. Many students who have no savings have to somehow find another $4,000 – before they pay a dollar in tuition.
Unlike many of their peers at Case, the vast majority of Kent State graduate students are working nurses who attend school part-time, said Tracey Motter, associate dean of students for the nursing school. Additionally, many of their employers offer tuition reimbursement programs.
Depending on the program, a master’s degree in nursing from Case can cost about $100,000 total in tuition, said Dean Ronald Hickman, who holds four degrees from the university. It won’t be easy to reduce it by a large proportion, he said.
Nursing students require close supervision, and it is neither easy nor cheap to recruit experienced faculty from hospitals.
“Right behind him in that picture window is the Cleveland Clinic, and right down the street is University Hospital,” said Case Chief Financial Officer Brian Burnett, who participated in a Zoom interview with Dr. Hickman attended. “Those are two great health systems that he’s competing with.”
What happens now? Not long after the law that created these new school categories was passed, nurses took to social media. Not “professional”? Really? Is it a coincidence that this happens in a profession where there are many women?
The comment was so pointed that the Department of Education was forced to respond to “certain progressive voices” that were “stoking fear.” It states: “Placing a cap on loans will force remaining graduate nursing programs to reduce their program costs to ensure nurses are not burdened with unmanageable student loan debt.”
“Professional” is a problematic word, but Education Department regulators had long used it in different contexts, and lawmakers adopted it in last year’s bill.
During a rulemaking process to figure out how to implement the new law, a committee that needed to reach consensus tried to find a way to classify more health care providers into the “professional” category. But only clinical psychology programs have managed to move from the “only borrow $100,000” column to the “borrow $200,000” column.
Is that a victory? Is there some sort of disconnect where people were in favor of more loan defaults a year or two ago, but now they’re advocating for more debt capacity?
The answers depend in part on context – and employability. Nurses are well placed in this regard. A few years ago, Kent State University graduates earned $113,089 five years after completing their master’s degrees. The case nurses didn’t earn much more – about $7,000 – even though Dr. Hickman said that years later, many of his graduates went on to work in administrative roles where people could earn much higher salaries.
There is a small likelihood that the final procedural steps before the law comes into effect could result in a shift in nursing master’s degree categories. And if not, Case’s nursing school probably won’t give up. It should find a way to give a little more discounts to people who need help, which is a key goal of many lawmakers.
In addition to the federal government, there are also options for borrowing money. However, it remains to be seen whether private lenders will take action. States can also offer their own loans; Connecticut, for example, is considering this.
But will all program applicants be eligible to borrow for everything they need? It remains possible that many lower-income prospective students in all sorts of graduate programs in health care and other supporting professions will not be able to enroll this year or any other year.
Mr. Burnett, Case’s chief financial officer, said he and other university leaders wanted to be in close contact with private lenders to argue that his students deserve competitive interest rates and terms.
He won’t be alone. According to our analysis, the average federal debt for 27 master’s in nursing programs in the United States is over $100,000, out of approximately 400 programs with published data. (Nursing is one of the most popular master’s degree programs.)
The average numbers don’t tell the whole story – just that half of people took out more loans and half took out less. It’s possible that students from other programs will reach the $100,000 limit, but not half of them. Another 119 programs had average debt loads between $50,000 and $99,999.
Some lawmakers have lamented the glaring debt burden of graduate programs in low-paying fields. In fact, about two dozen master’s in the arts programs reported average debt loads of over $100,000, and we found that their graduates often earn very little. In the vast majority of nursing programs across the country, the typical graduate is earning six figures within a few years.
Still, there are several dozen nursing deans who will likely have a lot to do this year to improve the numbers for their new students.