Sen. Warren Examines Questionable Business Practices of Largest Managers of Online Degree Programs – Framingham Source
WASHINGTON DC – United States Senator Elizabeth Warren (D-Mass.), a member of the U.S. Senate Committee on Health, Education, Labor and Pensions, and Senator Sherrod Brown (D-Ohio) wrote to the five largest Online Program Management (OPM) companies – 2U, Academic Partnerships, Pearson Learning, Wiley, and Bisk – that administer online degree programs for many colleges and universities, raising concerns about their business practices that appear to undermine the best interests of students, and inquiring about their contracts and use of federal student aid dollars.
Colleges and universities often enter into contracts with for-profit OPM companies to administer their online academic programs, but OPM companies can also charge colleges and universities for a variety of non-academic services, like recruitment and admissions services. OPM contracts often stipulate that the college or university must pay most of the tuition revenue from students enrolled in their online programs to the OPM. Because these contracts often delegate recruitment responsibilities to the OPM, this tuition-sharing arrangement may violate federal law, which prohibits colleges and universities from paying commissions for recruiting and enrolling new students.
Available evidence suggests that tuition-sharing arrangements in OPM contracts create perverse incentives that lead to aggressive and deceptive recruiting practices, similar to those that pervade the for-profit college industry.