The Washington Update: FY2018 Budget Priorities; Subsidized Student Health Insurance Indefinitely Extended Under ACA; and More

APLU and AAU send FY2018 Letter to the Office of Management and Budget
On October 20, APLU and the Association of American Universities (AAU) sent a letter to the Office of Management and Budget (OMB) regarding priorities for the fiscal year 2018 budget (FY2018). OMB will prepare transition materials to help the incoming administration develop its budget proposals.

The APLU-AAU letter requests that OMB’s FY2018 budget materials and guidance for the next administration highlight the importance of providing robust investment in higher education and scientific research.

Federal Regulators Indefinitely Extend Subsidized Student Health Insurance ACA Compliance
The Departments of Treasury, Labor, and Health and Human Services announced on October 21^st that they are indefinitely extending enforcement relief relative to subsidized student health insurance plans previously found to be in violation of the Affordable Care Act. The relief, “pending further guidance,” allows colleges and universities to continue offering graduate students subsidized health coverage for the time being. The Departments previously provided enforcement relief in February 5, 2016 guidance notification, but that relief was due to expire at the end of the academic year. While the latest guidance does not have a set termination date, the administration is interested in setting a more definitive solution within the next three months. APLU, in partnership with AAU, the American Council on Education, graduate student organizations, and a number of very active institutions is working to ensure any permanent solution preserves the ability of institutions to offer this coverage.

Department of Education Releases Final Borrower Defense to Repayment Rules
The Department of Education last week released its final rule on borrower defense to repayment (BDR). The rule was advanced following the closure of Corinthian Colleges, which led to an unprecedented level of federal student loan forgiveness sought by students under a rarely utilized Department of Education process.

Previously, BDR would allow students to file claims if they had a cause of action under state law. Under the new rule, the Department has created federal standards under which students can file claims for a) breach of contract, b) substantial misrepresentation and c) non-default, favorable contested judgment. Claims can be filed individually or as part of a group. If a Department of Education hearing officer finds favorably for the student, the Department can commence an action to recover from an institution of higher education.

APLU submitted comments on the proposed rule to the Department of Education in August. The comments noted support for strengthening BDR to ensure defrauded student have a path to relief and that institutions are held accountable. APLU noted that the most effective public policy would prevent schools like Corinthian from receiving access to Title IV in the first place. APLU’s comments also expressed concern for the overly broad scope of the rule and ambiguous process without clearly established institutional rights to defend against claims. While APLU continues to review the rule, changes appear minimal. The Department declined to clarify what would be deemed a contract with students and declined to add a “materiality” requirement related to institutional misrepresentations that could form the basis of claims. The Department did clarify that the rule includes a “reliance” standard. The Department did not outline additional procedures for the BDR process but noted that “schools will not be held liable for borrower defense claims until after an administrative proceeding that provides them due process.” The Department said it will outline procedures in a separate rule. The Department also clarified that the financial responsibility triggers in the rule, which could require institutions to provide a letter of credit or other financial protection, do not apply to public institutions as they are presumed to be backed by the full faith and credit of states. The proposed rule included an erroneous estimate of impact, which seemed to imply that the triggers could apply to public institutions. APLU requested that the Department clarify in the final rule that this part of the rule did not apply to public institutions.

APLU, Five Other Higher Education Associations Submit Comments to FCC regarding Business Data Services
On October 20, APLU and six other higher education associations submitted a letter in support of comments filed by Internet2 and EDUCAUSE in the Federal Communications Commission’s (FCC) Business Data Services proceeding. Business data services generally refers to broadband data and voice services sold to businesses. The associations’ letter recommends the FCC clarifies the proposed definition of business data services and explicitly state that it does not apply to non-profit, private research and education networks.

APLU, Other University Associations Request an Extension of the NIH Single IRB Policy Implementation Date
Last Monday, APLU joined the Council on Government Relations, the Association of American Medical Colleges, and AAU in sending a letter to the National Institutes of Health (NIH) requesting a one-year extension to the implementation date of the NIH Policy on the Use of a Single Institutional Review Board for Multi-Site Research. Currently, universities must comply with the policy by May 25, 2017.