Quality in Student Financial Aid Programs A New Approach (1993) / Chapter Skim
Currently Skimming:
Summary of Major Conclusions and Recommendations
Summary of Major Conclusions and Recommendations
Pages 1-18
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The large expenditures and the widespread use of student aid create great uncertainty concerning the adequacy of the system for delivering federal student financial aid. Especially troublesome for the U.S.
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In principle, two kinds of payment error occur in student financial aid programs: (1) errors of overpayment and (2)
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The panel found that technical errors, such as a missing statement of educational purpose or financial aid transcript, have a large dollar impact on measured error, since their absence renders the entire award erroneous. Such cases may or may not otherwise be eligible for financial aid.
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Recommendation 5-5: The Department of Education should improve estimates of "error" by including estimates of the coverage of student financial aid programs, that is, ascertaining the frequency with which eligible applicants are mistakenly deniedfinancial aid and the underaward amounts associated therewith. CURRENT QUALITY CONTROL PROCEDURES The Department of Education's current quality control process is described as focusing on prevention, inspection, and oversight.
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Verification activities place a major responsibility and burden upon the schools and, as a result, are very controversial. Each school is required to verify key elements of the applicant's record for all records flagged by the department's selection methodology (in recent years, up to 30 percent of an institution's student aid applications, but the 1992 reauthorization of the Higher Education Act allows the Secretary of Education to mandate up to 100 percent verification)
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Audits and Program Reviews The Department of Education has the responsibility to ensure that the approximately 8,000 participating postsecondary institutions administer student financial aid programs in compliance with federal law and regulations. The department executes this responsibility through two major retrospective activities: (1)
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Audit and review activities are necessary if the Department of Education is to fulfill its responsibility to ensure that program participation is limited to those institutions that are willing and able to operate responsibly, in accordance with program goals and expectations. Since factors such as changing economic conditions and student financial aid personnel affect an institution's ability to maintain desired levels of quality, "problem" institutions will appear sporadically and must be dealt with promptly and efficiently.
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Better use of the National Postsecondary Student Aid Study and coordination with the National Center for Education Statistics could help. Recommendation 5-7: The panel commends the Department of Education for its recent efforts to improve early awareness of federal financial aid programs, such as providing financial aid software to high schools.
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Testimony before the panel, as well as the panel's own deliberations, suggest that the application forms for student financial aid might be difficult to complete, especially for the typical lower income applicant, and that the design of the for might complicate the work of student financial aid officers who advise students about financial aid, check the accuracy of applicants' responses on applications forms, and attempt to correct erroneous data. As a result, the panel undertook a study of the federally produced AFSA and the Electronic Data Exchange process.
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These provisions include requiring that data base matches with the Selective Service be made and that the Social Security Number of all aid recipients be verified. With this advancement toward electronic data transfer of student financial aid information, the burden imposed by the collection of student certifications could be greatly reduced.
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These strategies are as valid in the Department of Education and other governmental agencies as they are in private industry. A total quality approach to administering student financial aid would seek not only to improve action taken at each step of the process, but also seek to continuously improve important outcomes expected of the entire process, such as accuracy of awards and accessibility of aid for eligible students.
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Support of the IQC Project Participation in the IQC Pilot Project is voluntary and assumes that the commitment to ensure data quality already exists in participating schools. The Department of Education has many positive activities associated with efforts to support IQC institutions, including training programs for new and continuing institutions, providing quality control software, recognition and awards processes, publishing a newsletter, state and regional meetings, and providing technical assistance from departmental and contracted personnel.
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One of its main goals is to simplify student aid programs. As a result of the passage of the bill, some of the concerns already expressed in this report concerning the complexity of the
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Such matches are being performed at several agencies and are reportedly very successful. (The panel recognizes that the department will likely need the help of Congress to pass legislation directing IRS to allow these matches and to make some changes in data requirements.)
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Centralized Verification The panel believes that a system based on centralized verification wills in the long run, simplify the verification process and increase accuracy. Institutional burden will be removed if the signed statements of educational purpose, Selective Service compliance, and the like, are required as part of the initial application.
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The study cited problems in coordinating offices within the department that needed to work together and labeled the resultant reactive decision making "remedial" and "not preventive." Recommendation 5-6: The Department of Education should not routinely embark on surveys of the type that have been used in the past to estimate total error levels in student financial aid programs. The resources are likely to be better spent on continuous monitorin~using data from audit and review activities, for example~nd other approaches to quality improvement.
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While, in themselves, these changes may not be bad, and some might be necessary, the panel sensed that the long-term vision for quality in student financial aid programs often suffered as a result of frequent turnover. The panel found that while the Department of Education required schools to invest heavily in quality inspection activities, it allocated limited resources for its own quality improvement activities.
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A thorough understanding of a system as complex as the student financial aid programs takes time. Recommendation 9-6: To ensure the development of and commitment to long-term planning, the politically appointed position in charge of the student financial aid programs (the assistant secretary for postsecondary education)
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