Postpandemic Federal Higher Education Accountability

Brief

Postpandemic Federal Higher Education Accountability

Exploring Conceptual Frameworks for Performance Measures
August 16, 2021

Abstract

The student loan pause and the pandemic-induced recession will have repercussions for metrics that inform federal higher education accountability. Although there are other forms of accountability within higher education, the federal role generally focuses on regulating the provision of federal financial aid. Institutions with poor outcomes risk losing eligibility to provide Title IV grants and loans to their students.

This brief examines the pandemic’s potential impact on the metrics of cohort default rates (CDRs), financial responsibility composite scores, and gainful employment (GE). We also examine how changes in published student loan and earnings outcomes may affect higher education choices. This brief assesses a set of short-term and long-term frameworks for accountability in the wake of pandemic-driven changes in higher education outcome measures.

In the short term, policymakers could consider the following:

  • Amend current default and earnings measures. The US Department of Education could consider targeted scrutiny of institutions that previously failed or were close to failing CDR metrics in the last nonpandemic cohort and require that institutions demonstrate good-faith efforts to improve outcomes. Additionally, if the department revives the GE accountability metric, the initial year of measures could again be provided for informational purposes and with appropriate contextual data.
  • Develop additional input-based measures. An alternative to amending student loan and earnings data is to temporarily supplement these outcome measures with additional information on institution inputs during the pandemic, though input-based measures are potentially more vulnerable to manipulation.
  • Increase College Scorecard data visibility. Changes to the data presented in the College Scorecard, which is published by the Department of Education and reports outcomes for institutions and programs, could better inform student choice. One possible approach is to present older earnings or loan repayment measures alongside newer data to provide context on whether the pandemic caused changes in the data.

In the long term, policymakers could consider the following:

  • Provide relative earnings measures. By providing data that compare earnings with a relative measure, such as the median earnings of a high school graduate in the same yar and local area, policymakers could account for recessionary earnings and deep economic differences across the country.
  • Use longer-term outcome measures. Earnings data generated in the first few years after leaving school may be biased by economic downturns. To counter this, earnings measures could be averaged across more earning years or across multiple pooled cohorts.
  • Reassess federal aid provision. Institutions that fail specific accountability targets lose the ability to disburse both grants and loans under the Title IV program. One way to reframe higher education accountability would be to separate eligibility to provide Pell grants from eligibility to provide student loans, which would only provide grant funding that is not expected to be repaid. This approach, however, risks pushing students toward the private loan market and does not guarantee that the students’ investment of time and effort will produce strong economic outcomes.
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