What do online college pursuits have to do with healthcare reform? Billions of dollars - some of which students might invest in online college classes and online degree programs. "Tucked" inside the recently approved federal healthcare reform package was what CBS News called "some of the most sweeping changes in history - helping students pay for college".
The federal government is considered the largest source of tuition assistance, providing grants, loans and work study program offerings so that students with financial needs can more easily afford college. An increasing number of students are reportedly enrolling in college, and online college programs particularly have experienced enrollment growth. More students are also seeking tuition assistance as a result of the economy, according to reports. The education bill approved with healthcare reform is designed to end government backing and subsidies for commercial bank and private lender-issued student loans and make more tuition assistance available, reports show.
The Obama student loan overhaul, as it's been coined, over the course of 10 years is intended to save about $61 billion and give college graduation rates a boost, according to reports. Much of the money is to be invested in federal financial aid offerings, some of which might require servicing assistance from private lenders, news agencies report. Students who qualify for government Pell grants and Stafford and Perkins loans are to benefit from the change, as are community colleges.
The measure approved is actually known as the Health Care and Education Affordability Reconciliation Act of 2010. Healthcare reform and the education bill overlap at the higher education level in that students can remain covered by their parents' insurance to age 26, rather than 21, according to reports.
More than half of the $61 billion in savings, or $36 billion, is intended to expand Pell grants to help students with financial needs. Qualifying Pell grant applicants for the 2010-2011 academic year are each to receive as much as $5,500 in tuition assistance, and qualifying applicants by 2019-2020 are to receive up to $5,900 apiece, The New York Times reported. Pell grants cover about 35 percent of the average student's tuition, where a few decades ago they covered 77 percent, news agencies report. If the Obama student loan overhaul hadn't been approved, Pell grant recipients next year would have only received a maximum $2,150 each.
Pell grants don't have to be repaid. But even students who receive what's known as direct loans from the government are to gain some repayment leeway as a result of the Obama student loan overhaul. College and university financial aid offices award the government's Stafford and Perkins loans to qualifying students who typically must put 15 percent of their income to loan payments, according to The New York Times. Beginning in July 2014, The Times reported, students only have to dedicate 10 percent of their income to loan payments. In instances where students make their loan payments on time, the loans can be forgiven after 20 years, The Times noted. Students qualifying for government tuition assistance might invest the money in online college pursuits when their plans are part of recognized degree programs. Some online degree programs are offered in accelerated formats that can help students with demanding schedules save time reaching their goals.
The Obama student loan overhaul reportedly also sets aside $2 billion for job training programs at community colleges. It's the first time the federal government provided direct aid to the community colleges, a college president told The Chronicle of Higher Education. President Obama himself has demonstrated support for online college offerings. During a talk in Detroit last year about investing in community colleges, he proposed adding $500 million in new online college classes as part of an overall investment intended by the year 2020 to add some 5 million new graduates, The Washington Post reported.
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