President Obama calls for a shakeup in higher education

In August, President Obama announced an ambitious plan to improve the quality of students’ college educations and the quality of the information available to both students and parents.

His plan has multiple parts – a college rating system, tougher requirements for students to keep financial aid, and in the years to come, a link between the college ratings and the amount of federal funding available for schools to give to students who need financial aid.

White House

The plan includes a scorecard that shows basic information, like graduation rates, the number of students receiving federal aid, information on a school’s affordability and even the amounts that graduates earn after they leave the institution.

The scorecard will be released in 2015, according to the Obama administration. A draft of the rating system is expected this December, with a final version next year. In linking the ratings to student achievement, the administration looks to provide an incentive for colleges that enroll large numbers of students who are eligible for Pell grants – these are grants that are awarded based on a student’s need and it does not have to be repaid, unlike student loans. Students at schools that receive a Pell Grant-related bonus could be eligible for larger grants and better interest rates on student loans, according to the White House.

The plan is expected to challenge colleges to shake up their offerings and the way they teach – offering things like more Internet-based classes or flipped classes where lectures are posted online and classroom time is spent analyzing real-world situations and with professors helping students to understand the content of the lectures. President Obama has called for more options, like a three year bachelor’s degree as well.

Another aspect of the plan is a shakeup in the student loan world. According to a White House fact sheet, the President wants everyone who considers college and who goes to college using loans to pay for it to know about all of the various loan repayment options, including the pay as you earn plan, which caps a student’s payments at a specific percentage of their income.

This plan calls for colleges to link a student’s earned credit hours with how well they understand the material – moving from a credit for seat time framework to a credit for competency plan. The White House offers Western Governors University’s competency-based learning and tuition of around $6,000 per year as a model for that change. Some differences between WGU’s model and the current model for higher education are that WGU is a non-for-profit university that offers bachelors’ and master’s level programs in a very limited number of subjects, compared to the offerings of public or private 2-year or 4-year institutions.

The Obama administration calls this plan a bargain for middle-class families, but opponents say the information is oversimplified and misleading.

A draft of the rating system is expected by the end of this year and the first ratings would be available to the public before the 2015-2016 academic year.