EXECUTIVE SUMMARY
In an era of increasing data interoperability in almost every sector of life, the idea that today’s students can’t seamlessly transfer credits from one institution to another seems preposterous. Yet higher education’s broken credit transfer system has plagued students and stumped policymakers for decades—to this day, first-time students who transfer lose 43% of their credits on average. This increases their time-to-degree, tuition costs, debt load, and opportunity costs.
As COVID-19 wreaks havoc on institutions and the students they serve, ushering in a recession that could have existential implications for all, helping learners earn the credentials they need from the providers best suited to serve them will be a critical issue in determining how well and robustly the nation recovers.
The federal government has already provided increased financial support to postsecondary students and institutions. More stimulus funds are likely on the way, offering a rare opportunity to not just shore up existing models, but also to provide a much-needed jolt to the calcified collegiate system, and to rethink how its players interact. Directing additional funds toward interoperability issues could go a long way in alleviating credit transfer challenges.
But history from just a decade ago in the field of healthcare shows that how this is done—not just that it is done—will matter. Many of the interoperability constraints faced by the healthcare system, which tried to help patients transfer their records from one provider to the next more easily and affordably, plague college and university business models—and higher education would be wise to learn what it can from healthcare’s flubbed attempt.
In order to tackle higher education’s credit transfer challenge, the Department of Education, along with state departments of higher education, should foster a parallel higher education system in which they support third-party credentialing entities that validate industry-valued skills. Regulators would use additional dollars that are focused on training students for in-demand jobs in this time of rampant unemployment, such as expanded Pell grants, to fund these efforts.
This move away from an institution-centered posture to one in which third-party bodies are the assessors of quality and gatekeepers of credentials would skirt the debates about whether learning at one institution is equivalent to that of another. Such a learner-centered approach, focused on the accumulation of knowledge and skills, would facilitate seamless transfer without credit loss, shift significant portions of higher education from seat-time to competency-based learning, and help learners transition expeditiously back into the workforce.
