As Congress gears up to revise the Higher Education Act (HEA), politicians on both sides of the aisle have raised concerns about the role played by accreditors, the organizations that determine which colleges are eligible for federal financial aid. Critics have faulted accreditors for focusing on inputs rather than student outcomes, acting as barriers to entry for new, innovative education providers, and relying on business and staffing arrangements rife with conflicts of interest. Arne Duncan, Secretary of Education under President Barack Obama, described them as “watchdogs that don’t bark.” So, just how does accreditation in American higher education work? Do the criticisms have merit? In the 10 questions and answers below, we explain the origins of our accreditation system and how it operates today.

1. What is Accreditation?

Accreditation is a legal status, and attending an accredited institution allows postsecondary students to use federal subsidies to pay for their education. 73% of full-time college students in the United States use federal subsidies—such as federally subsidized loans, federal work-study, and Pell grants—to pay for college, and the U.S. Department of Education (ED) specifies that an institution must be accredited by a nationally recognized accreditor for students to receive federal student aid.

2. Who are the Accreditors?

Accreditors are the private, nonprofit trade organizations responsible for accrediting colleges. The federal government recognizes these organizations as accreditors through recommendations made by the National Advisory Committee on Institutional Quality and Integrity (NACIQI), part of ED. As of 2012–2013, seven regional accreditors were responsible for accrediting more than 80% of the public and private nonprofit colleges in the United States. Most of these accreditors have existed for a century or more, and as of 2012–2013, they collectively oversaw nearly 3,000 colleges that enrolled over 90% of all college students in the United States.

 

Regional Accreditors
The Accreditor	The Region	Year Founded	# of Institutions	# of Students
New England Association of Schools and Colleges	New England	1885	242	1,008,000
Middle States Commission on Higher Education	Mid-Atlantic	1919	527	3,624,000
Southern Association of Colleges and Schools	South	1895	802	4,983,000
Higher Learning Commission	Midwest	1895	1,006	6,748,000
Northwest Commission on Colleges and Universities	The Pacific Northwest	1917	162	1,265,000
Western Association of Schools and Colleges	California and Hawaii	1924	177	1,003,000
Accrediting Commission for Community and Junior Colleges	California and Hawaii	1962	133	1,665,000

Table source: CHEA Almanac Online. Note that student numbers are rounded to the nearest thousand.

 

In addition to these regional accreditors, there are 11 national accreditors. Four national accreditors oversee faith-based colleges, and the remaining seven oversee technical colleges (many of which are for-profit institutions). Collectively, these national accreditors oversaw nearly 2,000 public or private nonprofit institutions in 2012–2013—but institutions accredited by national accreditors enrolled only about 15% of students at accredited institutions in 2013.

 

National Accreditors (2016)
The Accreditor	Year Founded	# of Institutions
Faith-Based Accreditors
Association for Biblical Higher Education Commission on Higher Education	1947	119
Association of Advanced Rabbinical and Talmudic Schools Accreditation Commission	1973	74
The Commission on Accrediting of the Association of Theological Schools	1918	245
Transnational Association on Christian Colleges and Schools Accrediting Commission	1979	65
Career/Technical Accreditors
Accrediting Bureau of Health Education Schools	1964	419
Accrediting Commission of Career Schools and Colleges	1967	748
Accrediting Council for Continuing Education and Training	1974	271
Accrediting Council for Independent Colleges and Schools*	1912	916
Council on Occupational Education	1971	391
Distance Education Accrediting Commission	1926	109
National Accrediting Commission of Cosmetology Arts and Sciences	1968	1,490

* In December 2016, ED finalized its decision to terminate recognition of the Accrediting Council for Independent Colleges and Schools (ACICS). The roughly 245 institutions still overseen by ACICS at that time had 18 months to seek accreditation from another accrediting agency.

Table source: CHEA Almanac Online.

 

In short, national accreditors oversaw nearly 40% of all U.S. colleges in 2012–2013, but regional accreditors oversaw 96% of public and 69% of private nonprofit colleges. And roughly 20,297,000 of the 23,994,000 students enrolled in accredited institutions attended institutions overseen by regional accreditors. The regional accreditors are the major players.

 

Types of Accreditors*
	Regional	National Faith-Based	National Career-Related
# (%) of Public Colleges	1,558 (96%)	0 (0%)	66 (4%)
# (%) of Private Nonprofit Colleges	1,379 (69%)	500 (25%)	127 (6%)
# (%) of Private For-Profit Colleges	112 (8%)	2 (0%)	1,230 (92%)
Total Number (%) of Colleges*	3,049 (61%)	502 (10%)	1,438 (29%)

*Note that the total number of colleges for each accreditor type does not necessarily equal the sum of its public, private nonprofit, and private for-profit colleges, as that total includes a few colleges whose accreditor was not indicated.

Table source: CHEA Almanac online

 

3. How Did Private Trade Associations—Rather Than the Federal or State Governments—Become Responsible for Accreditation?

Today’s major regional accreditors were originally founded in the late 19th century as voluntary college associations. By paying dues and working toward an association’s standards (on such matters as library size, faculty size, length of educational program, etc.), colleges could become recognized members of their regional association. Colleges could then use their membership to market themselves to prospective students, distinguishing their institutions from colleges that lacked such a membership, as well as from secondary schools (some of which were also called “colleges”).

In 1944, the Servicemen’s Readjustment Act, or the GI Bill, changed the federal government’s role in higher education. The government provided financial aid directly to veterans so they could receive education and training, and though the GI Bill was a boon to returning veterans, it was also a boon to “fly-by-night operations,” the preponderance of which eventually led to the House Select Committee to Investigate Educational, Training, and Loan Guaranty Programs Under the GI Bill. The Veterans’ Readjustment Assistance Act of 1952 required that institutions receiving GI Bill funds be accredited by one of the organizations on the Office of Education’s list of recognized accrediting and state agencies.

The Higher Education Act of 1965 expanded federal financial assistance to all postsecondary students, not just returning vets, and again used accreditation as a means of quality assurance; only students at accredited public and nonprofit institutions could access federal grants and loans. The 1972 HEA reauthorization also allowed students at accredited trade schools to receive federal financial aid and further expanded the availability of aid with a program for low-income students called the Basic Educational Opportunity Grant, or the Pell Grant.

The stipulation that institutions had to be accredited transformed college associations from private, voluntary associations into gatekeepers for billions of dollars of public aid. Though the triad of the federal government, state regulators, and accreditation agencies all play a role, accreditors are the key decision makers.

4. What Process and Criteria Do Accreditors Use to Evaluate Colleges?

The Higher Education Act stipulates the criteria that accreditors must use to assess colleges. The act requires that accreditors assess a variety of college inputs, including: facilities, equipment, and supplies; faculty; curricula; fiscal and administrative capacity; recruiting and admissions practices; and student support services. The act also states that accreditors must assess colleges’ “success with respect to student achievement in relation to the institution’s mission.”

However, ED cannot mandate the specific way in which an accreditor measures student achievement. In fact, the Higher Education Act explicitly states that ED is not allowed to “establish any criteria that specifies, defines, or prescribes the standards that accrediting agencies or associations shall use to assess any institution’s success with respect to student achievement.” Thus, accreditors are free to define and measure student achievement as they see fit.

The accreditation process consists of three main steps. First, a college must engage in an extensive self-study and submit that study to an accreditor. Then, the college must prepare for and host an accrediting site visit team that interviews stakeholders at the college. Finally, the accreditor reviews the evidence collected in the self-study and site visit, and determines whether the college will receive accreditation. Once a college earns accreditation, it must undergo a similar process every 5 to 10 years in order to maintain its accreditation.

This process requires a significant financial and time commitment. Colleges have estimated that it costs over $1 million to participate in an accreditation review, largely in the form of administrator and staff time. And the accreditation process takes years to complete. For example, it takes up to 5 years for a college to earn its initial accreditation through the Northwest Commission on Colleges and Universities, up to 6 years through the Western Association of Schools and Colleges, and up to 5 years through the Higher Learning Commission.

5. What are Critics Saying About Accreditors’ Lack of Interest in Student Outcomes?

Critics have suggested that the accreditation process is ineffective because accreditors focus primarily on college inputs rather than student outcomes. Because accreditors are free to define student achievement as they see fit, colleges with poor student outcomes often continue to earn accreditation. In fact, colleges with dismal graduation rates and high student loan default rates can not only receive accreditation, but in the words of a Wall Street Journal investigation, “glowing reviews.” According to a 2016 New York Times editorial, our college accreditation system “virtually guarantees that a portion of this money [public subsidies] will be wasted by schools that have abysmally low standards, high dropout rates and, in many cases, saddle students with huge debt in exchange for useless degrees.”

Critics have also observed that accreditors’ emphasis on inputs serves as a barrier for new or potential higher-education providers who would prefer an alternative educational model—one that is focused less on these inputs and more on student outcomes. For example, a report by the Center for College Affordability found that “accreditors, while tasked with certifying the ends, have instead mandated the means to be used while almost completely ignoring the ends. But if the inputs that must be used and the ways in which they are used are predetermined, that severely restricts the ability of new colleges to innovate.”

6. Who Staffs and Governs Accreditors?

Accreditors have only small full-time staffs and rely heavily on volunteer faculty and administrators from member colleges to conduct accreditation site visits. Critics have suggested that this staffing arrangement is a potential source of corruption, as accreditors may be hesitant to sanction colleges that are also providing staff for its reviews. Moreover, these volunteers are often chosen because they have experience at a college similar to the one under review; thus, volunteers may be familiar with the programming or personnel at the college under review. Volunteers have acknowledged that the relationship between reviewers and the staff at colleges under review can be “cozy.” In one instance, a volunteer even admitted that he had stayed at the home of an administrator.

Similarly, some critics note that the fact that accreditors are governed by the very same colleges that they are responsible for overseeing is a potential source of corruption. A close look at accrediting agencies’ governing boards and commissions reveals further conflicts of interest. A 2016 study of 15 major accrediting agencies found that 67% of commissioners or board members at these accrediting agencies are employed at an institution that the agency accredits. Even though the policies of most accreditors require commissioners to recuse themselves from decisions regarding the schools with which they are affiliated, “logrolling,” in which commissioners implicitly or explicitly promise to vote favorably for other commissioners’ schools if their school will be treated favorably in turn, may still occur.

7. What is the Financial Model of Accreditors?

Accreditors earn revenue from the colleges that they oversee. Colleges pay accreditors annual dues based on their student enrollment and/or expenditures. Colleges also pay fees to accreditors for conducting reviews. For example, in the 2018 fiscal year, colleges accredited by the New England Association of Schools and Colleges Commission on Institutions of Higher Education will pay between $6,526 and $32,308 per year in annual dues (depending on their enrollment and total expenses as reported in the institution’s 2017 Annual Report) and a $10,000 fee for an eligibility evaluation, should they require one.

The funds that accreditors collect from the colleges they oversee make up a large percentage of their revenues. For example, about 70% of the annual revenue collected by the Northwest Commission on Colleges and Universities comes from dues paid by the colleges it accredits. Another 22.6% of its revenue also comes from the colleges it accredits in the form of “evaluation, change, and reporting fees.” Critics have suggested that accreditors’ financial dependence on the colleges they accredit is a potential conflict of interest. Accreditors have a financial interest in accrediting as many colleges as possible. If an accreditor were to take action against many of its member institutions, it would weaken its own financial viability.

 

Revenues of Regional Accreditors*
The Accreditor	Total Annual Revenues	Annual Revenues from Dues	# of Institutions in 2012-13	Total Annual Revenues Per Institution
Southern Association of Colleges and Schools (2015)	$10,370,246	$5,961,051	802	$13,400
Higher Learning Commission (2014)	$14,422,087	$6,165,816	1,006	$14,300
Northwest Commission on Colleges and Universities (2015)	$3,194,498	$2,249,927	162	$19,700

*Revenue data in this table is based on the most recent publicly available Form 990 tax statements for each accreditor. Only three of the six regional accreditors are included in this table, as revenue data for the other three accreditors includes revenues related to both K-12 and higher education accreditation.

 

Finally, while the table above shows that a significant portion of each accrediting agency’s total annual revenue comes from membership dues, this understates the true cost of accreditation, as it does not include the costs of dedicating time and human resources to the accreditation process.

8. How Often Do New Colleges Earn Accreditation?

Critics contend that the current accreditation process can be a barrier to entry for new, innovative higher education institutions. The vast majority of accredited colleges have existed for decades and, in some cases, more than a century. And major regional accreditors rarely grant accreditation to new colleges. For example, the New England Association of Schools and Colleges oversees 242 accredited colleges in the United States—but just five of these colleges were granted accreditation between 2007 and 2016. Similarly, the Northwest Commission on Colleges and Universities oversees 162 accredited colleges in the United States—but just six of these colleges were granted accreditation between 2007 and 2016. In total, about 6% of colleges overseen by regional accreditors were newly accredited between 2007 and 2016.

 

New Colleges and Accreditation
The Accreditor	Total # of Institutions in 2012-2013	# of U.S. Institutions Accredited from 2007 to 2016	U.S. Institutions Accredited from 2007 to 2016 as % Total # Accredited Institutions in 2012-2013
New England Association of Schools and Colleges	242	5	2%
Middle States Commission on Higher Education	527	23	4%
Southern Association of Colleges and Schools	802	56	7%
Higher Learning Commission	1,006	35	3%
Northwest Commission on Colleges and Universities	162	6	4%
Western Association of Schools and Colleges	177	38	21%
ALL REGIONAL ACCREDITORS	2,916	163	6%

Total number of institutions as of 2012-2013 data per CHEA Almanac online.

 

Critics have observed that accreditors—governed, staffed, and funded by the colleges they accredit—have a clear incentive to protect colleges that have already earned accreditation and block new entrants from earning accreditation. This is particularly the case for online programs, which threaten to disrupt the traditional, in-person higher-education system as a whole.

In fact, critics note that accreditors have created a chicken-and-egg problem for new and potential higher education providers. Accreditors will only grant a college accreditation if it is already serving students—there is no initial or provisional accreditation for new higher education providers. But colleges need accreditation in order to attract students in the first place, because the vast majority of college students in the United States take advantage of the federal subsidies that accompany accreditation. Hence, accreditors have created a catch-22. In the words of Charles Miller, former chairman of the Secretary of Education’s Commission on the Future of Higher Education, “you can’t be accredited (get access to public money) until you have proved yourself in advance. You can’t prove yourself in advance—prospectively—unless you are accredited (or have access to piles of private risk capital for an extended number of years with little opportunity to operate effectively at an economic scale).” In practice, this makes it very difficult for new colleges to earn accreditation.

9. How Often Do Accreditors Deny or Withdraw Accreditation?

Accrediting agencies can make a range of decisions regarding accreditation, including approval, approval with conditions or a warning, sanctions or probation, or denial/termination.

But the vast majority of colleges that participate in the accreditation process receive approval from an accrediting agency, regardless of their student outcomes. A 2014 report by the U.S. Government Accountability Office (GAO) found that between 2009 and 2014, accreditors denied just 1% of colleges applying or reapplying for accreditation. And in 2016, regional accreditors granted or reaffirmed accreditation to 381 colleges while denying or withdrawing accreditation from just 6 colleges.

 

Summary of Accreditation Actions by Regional Accreditors (2016)
Type of Action	Frequency of Action
Grant Accreditation to Colleges Seeking Accreditation	19
Deny Accreditation to Colleges Seeking Accreditation	2
Reaffirm Accreditation to Colleges with Accreditation	362
Withdraw Accreditation from Colleges with Accreditation	4

Table source: CHEA Almanac Online

 

When an accrediting agency does decide to withdraw or deny accreditation, it rarely does so for reasons related to a college’s academic performance or outcomes. The GAO report found that “schools with weaker student outcomes were, on average, no more likely to have been sanctioned by accreditors than schools with stronger student outcomes.” And a Wall Street Journal investigation found that the U.S. government sent $16 billion in federal aid to students enrolled at accredited, four-year colleges that graduated less than one-third of their students within six years. The same investigation found that a college with an 18% graduation rate and 30% student loan default rate earned accreditation.

Accreditors’ focus on financial metrics may reflect the laws governing their actions. While accrediting agencies are required to have standards in financial areas, they are not required by law to consider student outcomes. Financial metrics are also easier to measure—which means they’re easier to explain in court. Many institutions that lose accreditation subsequently sue their accreditors to have their status restored, and according to Forbes, “Accreditors that start terminating schools based on student outcome characteristics, which are admittedly less objective than financial ones, can expect a deluge of lawsuits from de-accredited schools.”

10. What is the Role of ED in Overseeing Accreditors?

The HEA states that it is the responsibility of ED to “recognize” accrediting agencies. ED does not have the authority to directly manage the accreditors—for example, ED cannot mandate specific standards for student outcomes that accreditors must use. Instead, it can only approve, renew, deny, limit, suspend, or terminate an agency’s recognition status. ED is responsible for both evaluating new applicants for recognition and reevaluating accreditors that have already been granted recognition. Recognized accreditors must submit an application for continued recognition at least once every five years.

The accreditor review process is conducted by ED staff and NACIQI. NACIQI has 18 members. Six are appointed by the Secretary of Education, six are appointed by the Speaker of the House, and six are appointed by the President pro tempore of the Senate.

The review process is as follows: accreditors engage in a self-study aligned to the standards established by ED, ED conducts a site visit to the accreditor, NACIQI uses evidence from the self-study and site visit to recommend whether to recognize the accreditor, and ED makes a final decision regarding recognition.

Critics have observed that NACIQI and ED rarely hold accreditors accountable for their outcomes. A 2016 study by the Office of Elizabeth Warren found that between 2010 and 2016, NACIQI initially identified compliance issues with 80% of the accreditors requesting a status renewal but took no immediate action. The study also found that while NACIQI has frequently identified problems with the accreditors it monitors, it has rarely used “its own authority to hold those accreditors accountable for their failures.”

Moving Forward

A growing number of critics have pointed to the flaws in our current accreditation system—conflicts of interest, failure to focus on student outcomes, and barriers to innovation. Over the past several years, as student loan debt has skyrocketed, public subsidies for higher education have soared, and several high-profile private for-profit colleges have earned accreditation despite engaging in fraud, leading Democrats and Republicans have called for change. In Congress, Senator Lamar Alexander and Senator Elizabeth Warren have proposed ways to fix our accreditation system. Outside of Congress, organizations on both the right and the left have made recommendations for reform. Examples of their proposals include requiring that accreditors use standardized measures of student outcomes, creating different levels of accreditation to distinguish among colleges, and creating a provisional accreditation process that allows news colleges to earn temporary access to federal subsidies prior to full enrollment.

Other critics have little faith in efforts to reform our accreditation system and instead have suggested that real reform requires working around—rather than with—existing accreditors. These critics include political leaders (such as Senators Marco Rubio and Mike Lee) and think tanks (such as the Heritage Foundation and the Center for American Progress). They have suggested that the federal government or states should encourage the creation of new accreditors, and that existent accreditors should no longer serve as gatekeepers to federal subsidies.

Regardless of their position on the best approach to improving accreditation, all critics focus on at least one of three characteristics of our existent system: a lack of focus on student outcomes, conflicts of interests within the accreditation process, and the ways in which the accreditation process limits innovation. It is only by addressing those challenges that we will be able to ensure access to high-quality higher-education opportunities for all students across the United States.