Tuition is simply too high in some places.
Last year, federal legislators put a cap on the amount of money that students pursuing advanced degrees will be able to borrow from the government, and high tuition was one big reason. They believed that the old federal student loan rules — which allowed people to borrow the entire cost of tuition plus money to cover living expenses — encouraged institutions to raise their prices to the moon.
But lawmakers went further: Different graduate programs will have different loan limits. Students heading toward so-called professional degrees will be able to borrow up to $200,000 total in pursuit of their credential. Other programs will have a $100,000 cap.
Nurses pursuing advanced degrees did not end up in the professional category. The result is a kind of split-screen situation between different institutions that train them.
Take two schools in Ohio, which we examined using data from the federal College Scorecard, a consumer tool containing information about thousands of degree programs that the Department of Education maintains. At Case Western Reserve University, median federal student loan debt for recipients of nursing master’s degrees in 2019 and 2020 was $124,668, the available figures show. At Kent State University, just 35 miles or so down the road, it was only $37,500.
Given the new $100,000 lending cap, Case has a big problem here. Does it deserve to?
Case has a few disadvantages that are not its fault. It’s private, so it doesn’t get the same governmental subsidies that Kent State does.
It’s also in Cleveland, which comes with higher costs of living. When graduate students start school, they may be leaving the work force and not have a spouse or relatives who can help them pay.
Case estimates the food, housing, transportation and personal expenses for its graduate nursing students to be at least $24,512 per academic year. But in addition to the $100,000 loan cap for nursing students, the law mandates a $20,500 annual limit. Many students with no savings will need to find another $4,000 somehow — before they pay a dollar of tuition.
Unlike many of their peers at Case, the vast majority of Kent State’s graduate students are working nurses attending school part time, said Tracey Motter, the nursing school’s associate dean of academics. Also, many of their employers have tuition reimbursement programs.
Depending on the course of study, a master’s degree in nursing from Case can cost around $100,000 total for tuition, said its dean, Ronald Hickman, who has four degrees from the university. Lowering it by a large fraction won’t be easy, he said.
Nursing students need close supervision, and luring experienced faculty away from the hospitals is neither easy nor cheap.
“Right behind him in that picture window is the Cleveland Clinic, and then University Hospital is right down the street,” said Brian Burnett, Case’s chief financial officer, who sat in on a Zoom interview with Dr. Hickman. “Those are two excellent health systems he’s competing with.”
So what happens now? Not long after the law that created these new categories of schools passed, nurses hit the roof and took to social media. Not “professional”? Really? Is it a coincidence that this is happening in a profession that has a lot of women?
The commentary was so pointed that the Education Department felt compelled to respond to what it described as “certain progressive voices” who had been “fearmongering.” It said that “placing a cap on loans will push the remaining graduate nursing programs to reduce their program costs, ensuring that nurses will not be saddled with unmanageable student loan debt.”
“Professional” is a problematic word, but Education Department regulators had used it in different contexts for a long time, and legislators went ahead and adopted it for last year’s bill.
During a rule-making process to figure out how to put the new law in place, a committee that had to reach a consensus tried to find a way to wave more health care providers into the “professional” category. But only clinical psychology programs managed to move from the can-borrow-only-$100,000 column to the can-borrow-$200,000 column.
Is that a victory? Is there a kind of disconnect if people favored more loan cancellation a year or two ago but root for more debt capacity now?
The answers depend in part on context — and employability. Nurses do well on that front. As of several years ago, Kent State graduates earned $113,089 five years after finishing their master’s. The Case nurses didn’t earn that much more — about $7,000 — though Dr. Hickman said that years later, many of his alumni were in administrative roles where people could earn much higher salaries.
There is a small chance that the last procedural steps before the law takes full effect could mean that nursing master’s degrees shift categories. And if not, Case’s nursing school probably won’t go out of business. It is likely to find a way to discount a bit more for people who need help, which is one of the primary goals of many legislators.
There are also places to borrow money besides the federal government, though it remains to be seen whether private lenders will step up. States may offer their own loans, too; Connecticut, for one, is considering doing so.
But will all program applicants be eligible to borrow for whatever they need? It remains possible that many lower-income prospective students in all sorts of graduate programs in health and other helping professions will be unable to matriculate this year — or any year.
Mr. Burnett, Case’s chief financial officer, said he and other university leaders planned to be in close touch with private loan providers to make the argument that his students deserved competitive interest rates and terms.
He won’t be alone. According to our analysis, the median federal debt is over $100,000 at 27 master’s in nursing programs in the United States, out of some 400 programs with published data. (Nursing is one of the most popular master’s degree programs.)
The median figures don’t tell the full story — just that half of people borrowed more and half borrowed less. It’s possible that students at other programs are hitting the $100,000 limit, just not half of them. An additional 119 programs had median debt loads between $50,000 and $99,999.
Some lawmakers have decried eye-popping debt burdens at graduate programs in low-paying fields. Indeed, some two dozen master’s programs in the arts published median debt loads topping $100,000, and we found that their graduates often earn very little. At the vast majority of nursing programs across the country, the typical graduate earned six figures within a few years.
Still, there are several dozen nursing deans who will probably have a lot of work to do this year to make the numbers work for their incoming students.
Ron Lieber has been the Your Money columnist since 2008 and has written five books, most recently “The Price You Pay for College.”
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