In 2015, the DOE implemented the Gainful Employment rule, 

which was intended to identify poorly performing programs 

using a debt to earnings metric for graduates. The theory 

underlying the rule was that many programs were saddling 

students with too much debt relative to their earnings.

The rule uses 8% and 12% debt to earnings thresholds to 

determine program quality. A program at or above 12% fails 

and after two years of failure loses access to Title IV aid, 

effectively shutting the program. A program that has between 

8% and 12% is considered in the Zone and also loses Title IV 

aid eligibility after four years. Generally, once a program is in 

the Zone, it is likely to fail based on the retroactive nature of 

the rule.

During the 2013 negotiations, requests were made that the 

DOE provide debt to earnings data for all degree programs in 

all sectors to assure the regulation was accurately identifying 

quality. The DOE did not provide it.

The College Scorecard was published in September 2016 — 

after the rule was implemented — and for the first time, 

debt and earnings data were available for all institutions. Our 

analysis of that data demonstrates that high debt to earnings 

(relative to the stated annual 8%-12% DTE thresholds) are 

problematic across higher education. In fact, of the top 25 

institutions with the highest institutional debt-to-earnings 

ratios, 17 are non-profits, seven are proprietary, and one is 

a public institution.

During the February 2018 negotiated rulemaking session 

for Gainful Employment, the DOE informed the current 

negotiators that it does not have access to earnings on a 

program level for public and non-profit institutions. As a result, 

the DOE published a document titled “Debt to Earnings 

Analysis Using College Scorecard Data” dated January 2018. 

In it, the DOE states that although it has limitations, the debt 

to earnings data in the Scorecard is the best available proxy.

The DOE has proposed applying the debt to earnings metric 

found in the GE rule to programs at all institutions. It is our 

opinion that insufficient quality data has been provided to 

make an informed policy decision, particularly as it relates 

to establishing meaningful benchmarks. To this end, Monroe 

College analyzed the Fall 2016 and 2017 Scorecard data. 

The Fall 2017 Scorecard data can be found below. Our 

assumptions can be found below as Exhibit 1. 

It is our hope that our research (attached) helps provide data 

that will lead to a rational basis to the proposed policy.

Debt to Earnings Data Across All Sectors I Background
• DATA SET:

Fall 2017 Scorecard data were used. The data set may be 

downloaded from https://collegescorecard.ed.gov/data/.

• DEBT:

Cumulative median debt of borrowers was used for students 

who completed. The median debt is calculated using Title IV 

students who have federal loans. 

• EARNINGS:

Scorecard earnings were used at six years and 10 years after 

commencement of study for completers. 

• DEBT TO EARNINGS:

Ratio Used: All institutions that have institutional debt to 

earnings above 8% are identified. Institutions above 12% 

are separately identified. 

Interest rate: The interest rate employed in the Scorecard 

data set is used, which is 4.45%. 

Amortization Period: A 10-year amortization period was 

used to analyze the institutional debt to earnings for two 

reasons. Data for 15 years is available as well. First, the 

College Scorecard uses a 10-year amortization period to 

determine the “typical annual monthly loan payment”. 

Second, many consumer groups advocate for the 10-year 

amortization as it is more rigorous and reflects the standard 

repayment period on a federal student loan. The use of a 

10-year period is not meant as an endorsement.

• CLASSIFYING INSTITUTIONS:

We counted institutions by 8-digit OPEID. As a result, many 

institutions have multiple entities cited.

• DATA SET:

Five-year repayment data from the September 2017 

Scorecard were used to produce the analysis for repayment 

rates. The data set may be downloaded from 

https://collegescorecard.ed.gov/data/.

• REPAYMENT RATES:

The Scorecard calculated repayment rates for completers 

and non-completers separately. In a separate field, the 

Scorecard provided the number of students in each 

category. A weighted average was calculated to determine 

the overall repayment rate that is presented.

• CLASSIFYING INSTITUTIONS:

The 8-digit OPEID was used. As a result, many institutions 

may have multiple entities cited. 

EXHIBIT ONE I Data Assumptions – Debt to Earnings

Data Assumptions – Repayment Rates
ALL INSTITUTIONS

DEBT TO EARNINGS ABOVE 8%

Number of Schools Percentage of Schools Number of Students Percentage of Students

Public (2,064) 235 11.84% 1,395,303 46.53%

Private (2,008) 719 36.22% 1,067,276 35.59%

Proprietary (3,524) 1031 51.94% 535,875 17.87%

All Institutions 1985 2,998,454

INSTITUTIONS WITH DEBT TO EARNINGS ABOVE 8%

Source: September 2017 Scorecard Data — Using 6 Year Earnings

CHART 1
ALL INSTITUTIONS

DEBT TO EARNINGS ABOVE 12%

Number of Schools Percentage of Schools Number of Students Percentage of Students

Public (2,064) 32 7.67% 106,703 23.92%

Private (2,008) 122 29.26% 89,171 19.99%

Proprietary (3,524) 263 63.07% 250,199 56.09%

All Institutions 417 446,073

INSTITUTIONS WITH DEBT TO EARNINGS ABOVE 12%

Source: September 2017 Scorecard Data — Using 6 Year Earnings

CHART 2
ALL INSTITUTIONS

DEBT TO EARNINGS ABOVE 8%

Number of Schools Percentage of Schools Number of Students Percentage of Students

Public (2,064) 70 3.53% 259,780 8.66%

Private (2,008) 305 15.37% 319,834 10.67%

Proprietary (3,524) 557 28.06% 360,885 12.04%

All Institutions 932 940,499

INSTITUTIONS WITH DEBT TO EARNINGS ABOVE 8%

Source: September 2017 Scorecard Data — Using 10 Year Earnings

CHART 3
CHART 4 

ALL INSTITUTIONS

DEBT TO EARNINGS ABOVE 12%

Number of Schools Percentage of Schools Number of Students Percentage of Students

Public (2,064) 9 2.16% 26,199 5.87%

Private (2,008) 57 13.67% 42,506 9.53%

Proprietary (3,524) 65 15.59% 18,023 4.04%

All Institutions 131 86,728

INSTITUTIONS WITH DEBT TO EARNINGS ABOVE 12%

Source: September 2017 Scorecard Data — Using 10 Year Earnings
ALL INSTITUTIONS

REPAYMENT RATES BELOW 50%

Number of Schools Percentage of Schools Number of Students Percentage of Students

Public (2,064) 595 19.94% 3,618,189 70.64%

Private (2,008) 307 10.29% 389,494 7.60%

Proprietary (3,524) 2082 69.77% 1,114,464 21.76%

All Institutions 2984 5,122,147

INSTITUTIONS WITH REPAYMENT RATES BELOW 50%

Source: September 2017 Scorecard Data — Using 5 Year Earnings

CHART 5
ALL INSTITUTIONS

REPAYMENT RATES BELOW 35%

Number of Schools Percentage of Schools Number of Students Percentage of Students

Public (2,064) 142 8.18% 813,788 47.18%

Private (2,008) 170 9.80% 120,944 7.01%

Proprietary (3,524) 1423 82.02% 790,255 45.81%

All Institutions 1735 1,724,987

INSTITUTIONS WITH REPAYMENT RATES BELOW 35%

Source: September 2017 Scorecard Data — Using 5 Year Earnings

CHART 6