The U.S Education Department needs to strengthen its approach to monitoring college's arrangements with third-party online program managers (OPMs), according to a new report from the Government Accountability Office (GAO).
The report, released late last week, found that nearly three-quarters of the nation's college students were enrolled in an education program offered at least partially online in 2020. Some colleges have contracted with OPMs to help them deliver programs online and recruit students for these programs. Many such online managers receive a portion of generated program revenue in return for those services, making these arrangements subject to the department's oversight and the Higher Education Act's ban on incentive compensation to prevent abusive recruiting practices.
However, GAO's report, which was initially requested by Sen. Patty Murray (D-WA), found that the Education Department's monitoring instructions for annual audits and agency reviews fail to ensure that it obtains information about colleges' OPM arrangements to fully assess compliance with the incentive compensation ban. The agency, in fact, does not even know how many college OPM contracts exist, The Chronicle of Higher Education reported.
The report makes two key recommendations, with which the department agreed and described plans to address:
- The Secretary of Education should provide additional instructions that prompt auditors to ask specifically about OPMs, direct auditors to obtain and assess compensation information for OPM staff who provide recruiting services, and reference relevant guidance including the 2011 Dear Colleague Letter, which originally outlined the stipulations for OPM revenue sharing arrangements.
- The Secretary of Education should provide additional instructions to colleges regarding the information they must provide about their OPM arrangements during compliance audits and program reviews and explaining that colleges are responsible for both identifying all OPM contracts that include recruiting, and then providing auditors and Education's program review staff with copies of those contracts and information on how covered OPM staff are compensated.
"Without clearer instructions to auditors and colleges about the information on OPM arrangements that must be assessed during compliance audits and agency reviews, there is a risk that Education will not have the information it needs to detect incentive compensation violations," the GAO report states.
"With so many for-profit companies helping run—and recruit students for—colleges' online education programs, we must make sure students are protected," said Sen. Murray, Inside Higher Ed reported. "This report makes clear the Biden administration needs to conduct proper oversight to protect students, prevent abusive recruiting practices and improve transparency of these business arrangements—and I'm glad they are committed to taking action."
U.S. Government Accountability Office Report
The Chronicle of Higher Education
Inside Higher Ed