Two healthcare groups are suing President Donald Trump’s Education Department over upcoming changes to federal student loans for graduate students, which are set to take effect July 1.
New Loan Caps
Starting July 1, federal student loans for new graduate students will be capped annually at $20,500, with an overall limit of $100,000. Graduate students in programs designated as “professional” will have a higher annual limit of $50,000 and a total limit of $200,000. That “professional” designation only applies to a handful of fields, including law, medicine and dentistry.
Lawsuit Filed
The American Academy of Physician Associates and PA Education Association filed the complaint Wednesday in the U.S. District Court for the District of Columbia. They are requesting a preliminary injunction to stop the rule from taking effect for physician associate and assistant students, who would otherwise be subject to the lower borrowing tier.
According to Lisa Gables, CEO of the American Academy of Physician Associates, the Education Department “exceeded its authority and created a definition that will have devastating consequences” for PA students and the field overall.
Arguments
The groups allege the rule “unlawfully redefines professional degree programs” and want the Education Department to extend the “professional” label to PA students, granting them access to the higher federal loan limit. “PA programs meet every element of the professional degree definition that Congress established in law; they award entry-level master’s degrees, require rigorous clinical training, and lead to professional licensure in all 50 states. We are in court to ensure the law is implemented as Congress intended,” Gables said in a press release.
Ellen Keast, the Education Department’s press secretary for higher education, responded that “several examples” of colleges and universities are “already lowering the cost of tuition” in response to the legislation. She added that institutions “have been able to charge virtually unlimited tuition, even as many student loan borrowers see little to no return on their investment” over the last 20 years. “During this time, tuition has risen faster than any other household expense, and 71 percent of graduates with debt report delaying major life milestones, while institutions have taken in billions at the expense of young Americans’ financial stability. The Trump Administration is working to correct this longstanding imbalance by ending a system that pushed students into debt they often could not repay and by promoting access to high quality education that serves students, not institutional bottom lines,” Keast stated.
Impact on PA Students
The groups note that the average tuition for a PA program is “several times higher than the proposed annual loan limit,” creating an “immediate and significant barrier to entering the profession.” More than three-quarters of PA students who took out federal loans during the 2023-2024 school year borrowed above the upcoming annual cap of $20,500. PA programs typically take about three years after a bachelor’s degree, followed by a certification exam for licensure.
