Catastrophic Changes to Education: Borrowing Caps & Professional Degrees

Key Takeaways:

• Federal policy changes will limit students’ ability to borrow for critical advanced degrees, such as nursing, public health, and social work, among others.
• The new policy is intended to be narrow, and, if adopted, cannot be quickly undone.
• Nontraditional students and students from historically marginalized communities will be most gravely impacted, as well as patients, providers, and health care systems.

H.R. 1 and other recently proposed regulatory actions aimed at combating alleged “abuse” by education institutions will have far-reaching consequences for current students and future borrowers. The Department of Education’s proposal, which still needs to go through the rulemaking process, would subject many advanced degree students to lower strict annual and lifetime borrowing caps. The agency’s plan will cause students to lose access to critical federal aid, disproportionately affecting nontraditional students and students from historically marginalized communities.

Overview: Changes to Federal Borrowing Limits & Altered Definitions

The Graduate PLUS loan program, established in 2006 under the Higher Education Reconciliation Act, allowed students in graduate and professional degree programs to borrow up to the full cost of attendance not already covered by unsubsidized Direct Loans. While leaving undergraduate borrowing limits unchanged, H.R. 1 made the following changes to federal student loan borrowing:

• Graduate PLUS loans: eliminated as of July 1, 2026
• Graduate degrees: cap of $20,500/year; $100,000 aggregate cap
• Professional degrees: cap of $50,000/year; $200,000 aggregate cap
• Lifetime borrowing cap (all degrees): $257,500
• Unemployment deferment: eliminated for loans disbursed on or after July 1, 2027

The elimination of the Graduate PLUS program means that the Direct Unsubsidized Loan program will be the only source of federal borrowing for students enrolled in graduate and professional degree programs. The lifetime borrowing cap will hinder borrowing for lower income students or students in need of federal aid to access education, for no such lifetime borrowing cap existed before H.R. 1

Defining “Professional Degree”

As mentioned above, the maximum amount a student may borrow from the federal government relies in part on whether a degree is classified as a “graduate degree” or “professional degree.” Federal law has long defined a “professional degree” as

a degree that signifies both completion of the academic requirements for beginning practice in a given profession and a level of professional skill beyond that normally required for a bachelor's degree. Professional licensure is also generally required. Examples of a professional degree include but are not limited to Pharmacy (Pharm.D.), Dentistry (D.D.S. or D.M.D.), Veterinary Medicine (D.V.M.), Chiropractic (D.C. or D.C.M.), Law (L.L.B. or J.D.), Medicine (M.D.), Optometry (O.D.), Osteopathic Medicine (D.O.), Podiatry (D.P.M., D.P., or Pod.D.), and Theology (M.Div., or M.H.L.).” (emphasis added)

This definition was not an exhaustive list. Many professions beyond the ten professions listed were considered “professional degrees,” including Master of Public Health and Master of Social Work, so long as the specific program satisfied the beginning part of the definition.

The Department of Education hosted a negotiated rulemaking (a convening of interest groups to negotiate the text of a proposed rule before it is officially published for public comment) related to H.R. 1 provisions impacting the agency. (The Reimagining and Improving Student Education Committee (RISE Committee) member list is here). To counter “abuse” by institutions, the  "administration wants to keep [the law] very narrow."  The proposed regulatory text narrows the definition of “professional degree” to include only the ten professions explicitly listed, as well as clinical psychology (Ph.D., Psy.D.). Intending to create an exhaustive list, the proposed definition removes the “included but not limited to” language and requires the addition of additional degrees/professions to go through the full rulemaking process (i.e., degrees cannot be added to the definition merely through guidance).

Administration leaders rejected multiple requests from RISE Committee members to expand the list or to make the list non-exhaustive. Committee members raised many concerns about the new definition, but the administration says the committee unanimously voted to approve the new definition, despite the transcript lacking a record of a vote.

Defining “Expected Time to Credential” 

Something to look out for in the published proposed rule is the expected-time-to-credential (ETC) definition. It’s unclear from the meeting transcripts whether the committee came to an official position on this definition, as there was concern about the definition’s limit of three academic years. One committee member asked whether the limit of “three academic years” describes only full-time programs, and if so, whether the definition could be extrapolated to include part-time students who would have an expected credential time of more than three years. Agency officials essentially stated that the law makes no distinction between part- and full-time programs, and neither will they: “We're expecting them to credential within this three-year period of time, regardless of how they get there, part-time or otherwise.” 

Part-time professional degree students will be harmed by this definition. Once the three-year window expires for current students in this category, they will lose access to legacy benefits (i.e., pre-H.R. 1 rules that include higher borrowing caps, Grad PLUS loans, etc.). Future part-time students will also be impacted; because borrowing is prorated for part-time enrollment, they may get significantly less federal aid, and they might lose access to loans before finishing their degree simply because the ETC window closed. This will disproportionally impact nontraditional students, such as those with full-time jobs or with caregiving or childcare responsibilities.

Overview: CIP Codes & Professional Degrees

• What are CIP Codes? The Department of Education created Classification of Instructional Programs (CIP) codes largely for institutions to report data about instructional programs to the federal government.
• How are CIP Codes Assigned? Institutions have relatively broad autonomy when assigning CIP codes, which is generally done by faculty and program administrators and in consultation with college administrators. Some institutions consult with external stakeholders.
• Can CIP Codes be Changed? CIP codes generally only change in two circumstances: (1) the federal government makes its periodic changes to the CIP system (most recently in 2020), or (2) when individual programs make substantial modifications to their learning goals or curriculum. CIP codes may also change in the uncommon event that a state alters its curriculum framework, or if a CIP code was erroneously assigned.
• How Does the Proposed Regulatory Action Address CIP Codes? Under the proposed rule, a non-listed program could be considered a professional degree if it meets four requirements: the degree (1) has the same four-digit CIP code as one of the eleven programs; (2) signifies both completion of the academic requirements for beginning practice in a profession and requires a level of professional skill beyond that of a bachelor's degree; (3) is generally at the doctoral level and requires at least six academic years of postsecondary education, including at least two years of post-baccalaureate level coursework; and (4) generally requires a professional licensure to practice. 

The RISE Committee intends this rule’s application to be narrow. Committee members proposed adjusting the test to require sharing a two-digit CIP code rather than a four-digit CIP code, which would have significantly expanded the list. This proposed change was rejected by agency leadership. 

Implications: The Proposed Rule & CIP Codes

The proposed definitions for “professional degree” would exclude many degrees/professions from the higher annual cap and aggregate limit for federal student loans. The following programs are not only excluded from the “professional degree” definition, but they do not share a four-digit CIP code with any of the listed professions/degrees, and thus will not be considered a “professional degree:”

• Education (e.g., educational evaluation & research, special education and teaching);
• Social sciences (e.g., sociology, anthropology, economics);
• Social service professions (e.g., social work, public policy analysis)
• Communication disorders science & services (audiology, speech-language pathology);
• Public health (e.g., community health & preventive medicine, patient safety & health care quality, maternal & child health);
• Dietetics & clinical nutrition services
• Nursing (e.g., registered nurse, emergency room/trauma nursing, pediatric nurse);
• Allied health & medical assisting professions (e.g., anesthesiologist assistant, pathologist assistant, lactation consultant, physician assistant)
• Biological & biomedical sciences (e.g., immunology, biostatistics, neuroscience);
• Rehabilitation & therapeutic professions (e.g., occupational and physical therapy); and
• Mental and social health services (e.g., substance use/addiction counseling, mental health counseling, trauma counseling, hospice & palliative care)

Of the eleven degrees, only pharmacy, theology, and clinical psychology share a four-digit CIP code with other degrees, with research-focused degrees largely excluded. For example, clinical psychology shares a four-digit CIP code with other psychology degrees like community psychology, school psychology, and applied psychology or behavior analysis, among others. But degrees in research and experimental psychology do not share an identical four-digit CIP code and therefore would not be considered a “professional degree.”

A coalition led by the American Council on Education sent a signed letter to the Department, asking the agency to consult with and consider the impact of policy changes on stakeholders. The letter requested the agency to “create and disseminate a comprehensive list of professional degree programs,” in addition to adequately staffing the agency, updating internal technologies, and clearly communicating H.R. 1’s loan borrowing caps with consumers.

Why This Matters for Health Services Research

H.R. 1 and subsequent regulatory changes, if adopted as proposed, would

• Diminish the pipeline for students pursuing advanced degrees in public health, HSR, biostatistics, health economics, implementation science, informatics, and health policy.
• Disproportionately affect part-time and mid-career students—many working in health systems and state or local public health—who are central to practice-based HSR.
• Undercut diversity in HSR by limiting access to affordable education for students with caregiving or childcare responsibilities or from historically underserved communities.
• Reduces cross-disciplinary clinician-researchers in nursing, social work, therapy, and allied health professions, which are all critical to quality, safety, and access research.

How to Get Involved

As the government prepares to publish its proposed rule for the notice and comment period, stakeholders must make their concerns heard. AcademyHealth urges institutions, organizations, students, practitioners, and patients to submit a comment, contact their representatives, and share information as to how the proposed rule would be catastrophic to the future of education, student health, health care systems, and our nation’s workforce.