The One Big Beautiful Bill Act, signed into law over the summer, impacted several policies of importance to psychology, including making substantial changes to federal student loan programs that many doctoral psychology students use to finance their education. The law eliminated the Grad PLUS student loan program, which allowed all postbaccalaureate students to borrow federal loans up to the cost of attendance, and established new student loan caps for postbaccalaureate study, delineating between graduate and professional programs, with the latter limited to programs requiring licensure:
- Graduate programs: $20,500 annual limit; $100,000 aggregate limit (exclusive of undergraduate borrowing).
- Professional programs: $50,000 annual limit; $200,000 aggregate limit (exclusive of undergraduate borrowing).
APA Services, in partnership with psychologist advocates, spent months working with Congress to mitigate the negative impact of some of the proposals being considered and to ensure that the loan limits that were included in the law were robust enough to support as many psychology programs as possible. Once the bill passed, the Department of Education was responsible for implementing these provisions and, most importantly, determining which programs would be designated as a “professional degree.”
To do so, the department uses a process called negotiated rulemaking, which it has been conducting since mid-August. During this time, APA Services engaged in a multi-pronged advocacy strategy to ensure that psychology programs requiring licensure were explicitly included in the definition of “professional degree”:
- Submitted comments to the public hearing before the start of negotiations.
- Worked closely with key negotiators on the rulemaking panel.
- Brought together key House members in a bipartisan letter (PDF, 131KB)opens in new window to the Department of Education.
- Engaged SPTAs in outreach to key senators.
- Met with Department of Education staff to share data and provide important clarifications.
On November 6, the negotiated rulemaking panel took its final consensus check and approved a package of regulations to implement portions of the higher education provisions in the One Big Beautiful Bill Act. As a result of our work over these several months, the consensus language included health service psychology programs, as well as some applied psychology programs, as part of the definition of “professional degree” for the newly established federal student loan limits. In fact, these programs were the only other addition to the original list of programs initially mentioned in the bill.
This designation will allow doctoral psychology students in these programs to borrow federal loans at the highest level set in law ($50,000 annually, $200,000 lifetime; exclusive of undergraduate loans). The regulatory text explicitly includes clinical psychology (PhD and PsyD), as well as all other programs within the same 4-digit CIP Code (42.28) as clinical psychology, so long as they are also doctoral programs and lead to licensure. That means counseling psychology, school psychology, and some applied psychology programs will also be included.
While these changes will affect new borrowers, the department clarified that all current borrowers will be grandfathered in as part of the legacy student loan programs (both Grad PLUS and the bump-up in current loan limits for health professions degrees, including clinical psychology) for the lesser of three academic years or the remaining length of their current program.
Given that the panel reached consensus, the department is now legally bound to use this language when drafting a proposed rule, which it is aiming to do either before the end of the year or in early 2026, which will be followed by a 30-day public comment period. A final rule is likely to be published by Spring 2026, with a July 1, 2026, implementation date.
For more information, contact Kenneth Polishchuk.