Lessons from a Risk-Based Oversight Model Designed to Protect Students and Taxpayers
Published January 31, 2022
Over the past 20 years, many higher education institutions have closed without warning, leaving student veterans without degrees and with few options to complete their degrees and get better jobs. Partially in response to these concerns, and recognizing the limited staffing and budgets of state approving agencies to provide quality assurance, Congress passed for the first time a law requiring risk-based reviews. Six pilot state approving agencies have now successfully implemented a process targeting reviews to schools most likely to leave veterans worse off—having used up their limited GI Bill benefits, often taking out loans, and lacking a marketable degree. The goal of this work is to protect student veterans and taxpayers from schools at risk of closure or persistent failure to deliver on their promise to students, given the problem of limited oversight capacity. Importantly, this piloted system is built on public data, making it replicable to other contexts, such as state and federal oversight of the nearly quarter trillion dollar annual federal investment in Title IV financial aid (student loans and Pell grants), Department of Defense Tuition Assistance, federal investments in workforce training, and college accreditation. In all of these contexts, regulators have limited resources that should be focused on improving or weeding out schools and providers that pose a greater level of risk. These risk-based reviews are a critical example of the federal government taking bipartisan action to protect student veterans and taxpayers, and this pilot shows that such a system can —and does—work. This work provides important information and insight for policymakers and can serve as a model to inform higher education quality assurance and consumer protection more broadly. The full report can be downloaded using the button to the left. An executive summary of the report is here and an appendix is here.