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Oversight of Online Program Management (OPM) Companies and Incentive-Based Compensation

Student Defense has strongly advocated for the Department of Education to revisit its policies regarding how colleges and universities may engage third-party OPM companies to provide bundled services such as recruitment, marketing, curriculum development, and instruction on their behalf.

In March 2023, we released two new legal and policy briefs in response to a Department of Education request for public comment related to online program management (OPM) regulation and oversight. The legal brief finds that a bundled services loophole established in a 2011 ‘Dear Colleague’ letter from the Department of Education is illegal, while the policy brief demonstrates how the loophole harms students by incentivizing predatory student recruitment practices. 

The loophole allows these bundled service providers to sidestep the Department’s incentive compensation ban, which prohibits compensation from being directly linked to student enrollment. OPM providers have come under recent scrutiny for employing deceptive marketing tactics in an effort to boost enrollment — exactly the type of behavior that prompted the incentive compensation ban in the first place.