Graduate students at the University of Iowa could soon face new financial barriers as federal officials move to narrow which advanced degrees qualify as “professional” — a change that would restrict access to key federal loans and shift many students toward private loan lenders.

As of Nov. 24, the U.S. Department of Education, as part of its implementation of the “One Big Beautiful Bill Act,” announced many degrees would no longer be considered professional degrees.

Under the current system, students can borrow up to their full cost of attendance through federal Direct PLUS loans. The new loans introduce hard lifetime caps — $100,000 for programs classified not professional and $200,000 for those considered professional — which could leave students short on funding and push them toward private lenders.

According to the department, a professional degree is a “degree that signifies both completion of the academic requirements for beginning practice in a given profession and a level of professional skill beyond that normally required for a bachelor’s degree. Professional licensure is also
generally required.”

Brenda Buzynski, assistant provost and director of student financial aid at the UI, said a primary reason the change was made was that the government was losing money from the loans, mentioning the COVID-19 era loan payment pause specifically as a major loss.

“For two years or so, [students] did not have to make payments. Now they’re trying to get them to make payments to the loan servicers, and that’s becoming a real challenge. From the government’s perspective, they’re not making money off of this, being the lender for the direct loan program,” Buzynski said.

According to a Penn Wharton Budget Model, a nonpartisan economic analysis initiative,  the estimated total budgetary cost of the federal student-loan payment pause was about $210 billion from March 2020 to August 2023.

Degrees excluded from the professional degree classification include nursing, physician assistant, physical therapy, audiology, education, and social work. Degrees considered professional include medicine, law, and dentistry.

RELATED: Former Iowa Regent David Barker appointed to U.S. Department of Education

The plan is up for public comment, during which anyone — students, professionals, organizations — can submit feedback through the federal rulemaking portal. Based on public comments, the department may revise the definition before publishing a final rule expected to be released in July 2026.

Cassie Barnhardt, professor of higher education and student affairs at the UI, said this is one of the biggest changes to higher education and that these new policies are giving students very little time to adapt, considering most graduate programs require students to accept admission offers in the spring. 

She said students being able to evaluate whether or not they can attend graduate school hinges on cost, graduate assistantship, overall amount of financial need, and available aid. 

“All those questions come into place, and students have to make decisions by mid-May,” she said. 

Barnhardt said one of the possible effects of the loan caps is a lowering in tuition. However, the effects of the policies remain unknown.

“I think that’s one of the philosophies that it would put pressure on universities to change pricing, but at the end of the day cost of graduate education is more expensive because the type of education that you’re providing is more apprenticeship model, especially if we’re talking about doctoral education,” Barnhardt said.

With these changes in loan caps, Barnhardt said there’s also a possibility of a loss of graduate student enrollment in the coming years.

“It could have an impact on the research infrastructure or the teaching infrastructure of universities if your graduate students decide to enroll in universities. You know if you have a staffing shortage that could happen,” Barnhardt said.

Buzynski said many students applying to graduate school aren’t yet aware of the changes made to higher education.

“I think later in December, and in the spring when those students are admitted, I think they’ll start the next question. ‘OK, now how can I afford this?’ But right now, that phase is still at the application stage, will I get admitted? Then they start thinking about, ‘OK, now how am I going to pay for this?’” Buzynski said.

Allison Bywater, a fifth-year UI doctoral candidate in counseling psychology, said she and her colleagues are very concerned over the policy and its effect on future clinicians.

“I believe my colleagues would join me in saying that this policy doesn’t just exist in a vacuum, but rather it reflects broader, societal values about what kind of laborers we fund, whose care matters, and which professions we end up protecting,” Bywater said. 

Bywater said that clinical psychology losing its professional classification felt deeply demoralizing and disheartening, suggesting the work she did was less worthy of protection.

The department addressed concerns similar to Bywater’s in the news release and said it was a myth that the Trump administration considered nurses as not professional.

“The definition of a ‘professional degree’ is an internal definition used by the department to distinguish among programs that qualify for higher loan limits, not a value judgement about the importance of programs. It has no bearing on whether a program is professional in nature or not,” a news release from the department said.

According to the National Alliance on Mental Illness, more than one in five U.S. adults experience mental illness each year, and Bywater said access for these individuals will grow increasingly difficult if these policies are implemented.

“You know we’re already in a nationwide mental health crisis, waitlists are extremely long, months long. Rural communities, like in Iowa, have almost no access to a psychologist,” Bywater said. “College counseling centers are overwhelmed, and now we’re essentially constricting the pipeline into the very professions that could address this crisis.”