Judge Tosses “Professional” Degree Definition

A federal judge has tossed out the Education Department’s rule that strictly limited graduate students’ access to higher federal student loan borrowing limits, a victory for universities, health-advocacy groups and others who argued the policy could stop students from earning advanced nursing degrees and pursuing other crucial professions. 

The ruling, released late Wednesday night, centers on the definition of “professional” degree in Congress’s One Big Beautiful Bill Act and how the department narrowed that definition when it issued its rule implementing the law. Judge Beryl A. Howell of the U.S. District Court for the District of Columbia called the department’s approach “misguided.” 

“Congress could not have been clearer as to the meaning of ‘professional degree,’” Howell wrote, saying ED had diverged from that meaning. 

The lawsuits regarding the rule aren’t over—Howell technically stayed the rule “pending final resolution of this litigation”—and ED didn’t provide interviews Thursday on how it would respond to the decision. It’s unclear now which programs ED will deem professional and thus eligible for higher loan borrowing caps. The loan limits take effect July 1.

In an email to Inside Higher Ed, the department said only that “this order allows ED to enforce the statutory professional degree definition and loan caps. ED is reviewing the order and will take appropriate action.”

The statutory definition of a professional degree is “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.”

The National Association of Student Financial Aid Administrators wrote on its website that “significant uncertainty remains as the ruling is only a day old. ED has not yet appealed, a path they can pursue, or commented publicly on any plans to issue guidance. For now, institutions should consult their own legal counsel before deciding how to proceed.” 

When Congress passed OBBBA last summer, Republicans ended the Grad PLUS program, which allowed grad students to borrow up to their full cost of attendance, and put in place new caps on borrowing. The law limits “graduate students” to borrowing $20,500 per year, or $100,000 in total, and “professional students” to borrowing $50,000 per year, or $200,000 in total. ED then went through a monthslong process to determine how to implement the law. The professional definition was a point of contention throughout the process. 

The department ultimately decided that only students in 11 degree programs could borrow at the higher, “professional” level: pharmacy, dentistry, veterinary medicine, chiropractic, law, medicine, optometry, osteopathic medicine, podiatry, theology and clinical psychology. ED deemed all other programs “graduate.”

Other than clinical psychology, those 11 programs were also listed at the end of the definition of professional degrees in OBBBA. But that definition notes that “examples of a professional degree include but are not limited to” before listing the programs. 

ED used criteria beyond what was mentioned in OBBBA to say that that list of programs, plus clinical psychology, should be the only ones to count as professional. Howell ruled that Congress adopted a specific definition into its law, and ED couldn’t change that. 

“Congress did not direct the Department to evaluate and update the regulatory definition already in [law] with any new eligibility criteria, let alone five material changes to the statutorily adopted regulatory definition,” Howell wrote. “In fact, Congress did the opposite. By adopting the preexisting definition as it was in effect on a specific date, Congress removed any discretionary authority the Department may have had to narrow the definition for the purpose of determining federal loan caps.” 

She also said there was a contradiction between the department’s belief that Congress didn’t instruct it to consider “adverse effects on staffing in healthcare and education, diversity in the workforce, rural and underserved communities, and working families,” and its belief that it could make these changes to Congress’s definition. 

“The Department restricted its analysis, due to lack of congressional instructions, when considering real-world factors militating in favor of broadening the definition; its decision to nevertheless go beyond congressional instructions to restrict the definition of ‘professional degree’ is as puzzling as it is legally erroneous,” Howell wrote. 

In an email to Inside Higher Ed, Josie Eskow Skinner, a partner at Sligo Law Group, said ED doesn’t have time to create a new rule, so “language in the statute will be what controls.”

“Since the language in the statute is much broader, more than just those 11 professions in the rule should be covered under the professional degree umbrella,” Skinner wrote. “That being said, I wouldn’t be surprised if the government immediately appealed the decision to the Circuit Court and asked for a stay of the stay.”

The PA (which used to stand for “physician assistant”) Education Association was among the groups that filed the two cases Howell ruled on simultaneously on Wednesday. In a news release, the PA Education Association said the “ruling provides temporary but immediate relief as the case moves forward” on the merits of the legal arguments. Physician assistants weren’t deemed “professional” by ED. 

“Our focus remains squarely on seeing this challenge to the PA profession through to a final resolution,” the release said. “Thousands of prospective PA students remain unable to make long-term decisions about their education and future careers with confidence. The uncertainty created by this rule continues to threaten the future healthcare workforce at a time when communities across the country already face growing provider shortages.”