A handful of community colleges in Ohio that offer medical office assistant certificate programs are at risk of losing federal student aid because the graduates’ starting salaries are too low to successfully repay student loan debt.
According to a report in The Columbus Dispatch, students who earn a medical office assistant degree at Harrison College in Grove City, Ohio will be on tap to pay back $2,545 in student loan debt per year while making under $16,000 annually. That puts the debt to income ratio at 16 percent, which would be higher than what is considered sustainable debt under the Department of Education rules.
Graduates of the American National University’s medical assistant program are staring at student loan debt payments that average $3,020 a year while making only $19,000.
Similarly, graduates of a medical assistant program at Daymar College in Columbus, will make an average of $11,471 a year but owe $3,505 a year in student loans.
Those three schools’ medical assistant programs could be eliminated from the federal student loan program because of graduates’ high debt to income ratios. These are indicative of a growing problem for students around the country. They are spending a fortune to earn a degree or certificate only to earn too little to survive, let along pay back their student loans.
Aiming to stop that from happening in the future, the Department of Education, under former president Barrack Obama, rolled out the gainful employment rule. This holds for-profit colleges and certificate programs accountable to prepare students for “gainful employment in a recognized occupation.”
In order to pass the gainful employment rule, the average graduate’s annual loan payment can be no more than 20 percent of his or her discretionary income or 8 percent of total income. If the average student’s annual loan payment amount exceeds this threshold, the program which he or she attended may no longer be eligible for federal financial aid.
For the for-profit colleges and certificate programs, losing federal financial aid could be a death blow as most of their students rely on financial aid to attend these schools. The report noted that at least 15 programs at four Ohio schools are at risk of losing access to federal financial aid.
Daniel G. Peterson, chancellor of Nashville-based Daymar told the Columbus Patch that he expects U.S. Rep. Lee Zeldin, a Republican from New York, to request the Trump administration delay enforcing gainful-employment until congress can review it. Given that the new administration is moving to overhaul lots of former president Obama’s regulations, it’s not a stretch to think the gainful employment rule will at least get another look.
Author: Donna Fuscaldo
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