We highly recommend Pro Publica’s latest article on student loan disability discharges. In this article, Sasha Chavkin asked the Department of Education to clarify its position on the most critical disability discharge issue—Will the Department consider Social Security disability determinations when making student loan disability discharge decisions? The answer, as Chavkin reports, is that the Department can’t and won’t do this.
This is outrageous. The Department has been talking about using Social Security determinations for years, but hasn’t done so. The Department’s general excuse has been that their hands were tied because the Higher Education Act disability discharge standard was more restrictive than the Social Security disability standard. Even if this was true before, it is clearly no longer true since Congress amended the Higher Education Act in 2008. The definition of disability for student loan discharges is nearly the same now as for Social Security disability determinations.
The upcoming negotiated rulemaking process is a golden opportunity for the Department to finally do the right thing and allow borrowers to submit Social Security disability determinations as presumptive proof of eligibility for student loan discharges. Instead, the Department seems to be saying that it will do no more than tweak the disability discharge process. The largely silent constituency of disabled borrowers deserves better. Taxpayers too. The current Department of Education process would be more efficient and presumably less expensive if the agency used Social Security determinations.
In the meantime, the Department has created bureaucratic barriers that prevent eligible borrowers from obtaining this important benefit. Our experience is that many applicants are denied on technical grounds, such as a doctor’s failure to fill in a license number. Trying to fix these technical problems can be a nightmare . Many borrowers are told to start over…and over…and over.
We understand that the government wants to create a reasonable application and screening process. Fair enough. The problem is that the Department has created a random process where too often borrowers don’t have the opportunity to get merit-based decisions. Only those that can persevere or are fortunate enough to have competent counsel tend to break through and get the promised relief. This is not the way it should be for some of the most vulnerable members of society.
At a minimum, the Department should add this issue to the negotiated rulemaking agenda.