For-Profit Medical Schools

[Alpha]

good or bad?
For-Profit Medical School Proposed In Montana Sparks Concerns : Shots - Health News : NPR

[ss20ts]

The for profit and nonprofit thing is really misguided. ALL colleges have to make some sort of profit otherwise they won't stay afloat. Look at the endowments nonprofit schools have. Many are larger than the national budget of numerous countries! Plenty of nonprofit colleges close every year as well. Their students have loans as well. The problem is the federal government got into the student loan business.

[eLearner]

The for profit and nonprofit thing is really misguided. ALL colleges have to make some sort of profit otherwise they won't stay afloat. Look at the endowments nonprofit schools have. Many are larger than the national budget of numerous countries! Plenty of nonprofit colleges close every year as well. Their students have loans as well. The problem is the federal government got into the student loan business.

Facts, but nobody ever wants to discuss that. It's just another example of the lack of understanding the general public has. The media doesn't help the situation either because all it does is attack for-profit schools and pretend non-profits never have most of the same issues. If the unwitting public had it their way, every school would be a non-profit, but it would be a rude awakening when they see that tuition will still be high, loan amounts will still be insane, and a great deal of the workforce will be still be paid below (and often times well below) what they were told was possible pre-enrollment.

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... and whudda ya know. They even managed to do the same thing ALL of these articles do: mention ITT Tech. It never fails. They almost always manage to use that as an example every time. Why not just go for the gold and mention DeVry and University of Phoenix, too? Smh. So predictable.

[ss20ts]

That always cracks me up! I'm like yeah because a nonprofit ever mismanaged their funds! A nearby school did a massive fundraiser trying to raise 7 million bucks in 30 days to stay afloat once they sent all of the students home last March. By June they were out of cash because they had to refund the room & board fees. Tuition doesn't pay their bills. Room & board is what keeps them in the black. Same for many schools. Education is all about $$$$$. Always has been.

[eLearner]

That always cracks me up! I'm like yeah because a nonprofit ever mismanaged their funds! A nearby school did a massive fundraiser trying to raise 7 million bucks in 30 days to stay afloat once they sent all of the students home last March. By June they were out of cash because they had to refund the room & board fees. Tuition doesn't pay their bills. Room & board is what keeps them in the black. Same for many schools. Education is all about $$$$$. Always has been.

And that goes for many successful non-profit schools. I like to make Harvard an example: They could give free tuition to every student and still bring in the many billions in endowments they do and not miss a beat. But no complaints about that, instead people want to complain about for-profit schools that staff 100 people and charge 1/8th of Harvard's tuition. People don't even consider scale and just lazily conclude that all for-profit schools are like University of Phoenix in size and ITT in operation. That's how ridiculous this whole thing has gotten, smh. No critical thinking is ever being applied to the matter.

[ss20ts]

That always cracks me up! I'm like yeah because a nonprofit ever mismanaged their funds! A nearby school did a massive fundraiser trying to raise 7 million bucks in 30 days to stay afloat once they sent all of the students home last March. By June they were out of cash because they had to refund the room & board fees. Tuition doesn't pay their bills. Room & board is what keeps them in the black. Same for many schools. Education is all about $$$$$. Always has been.

And that goes for many successful non-profit schools. I like to make Harvard an example: They could give free tuition to every student and still bring in the many billions in endowments they do and not miss a beat. But no complaints about that, instead people want to complain about for-profit schools that staff 100 people and charge 1/8th of Harvard's tuition. People don't even consider scale and just lazily conclude that all for-profit schools are like University of Phoenix in size and ITT in operation. That's how ridiculous this whole thing has gotten, smh. No critical thinking is ever being applied to the matter.

These endowments are so far out of hand. Why does Harvard (or any college) need a $40 BILLION endowment? 

https://www.usnews.com/education/best-co...endowments

The top 10 have large endowments than most nations have for an annual budget. Out of 228 countries, only 57 have a higher national budget than Harvard's endowment. Where's the outrage over that? Think about that. An entire NATION spends less money than Harvard is sitting on. Why is their tuition so high? How exactly are they a nonprofit? The whole for profit and nonprofit labels really need to go away. They're ALL in this to make money! 

https://en.wikipedia.org/wiki/List_of_co...ent_budget

[sanantone]

Endowments are not profits, and they cannot be spent however a school wants. Endowments are donations, and the person or organization who made the donation often stipulates how the money can be spent. Why would anyone complain about Harvard when the average debt of the graduates is low, they cover 100% of the tuition for students whose families make less than $125k, their graduation rates are high, and their student loan default rates are low? University of Phoenix has literally broken the law multiple times, and they were temporarily banned from military installations because they were recruiting veterans with brain damage. But, yeah, they're just like Harvard.

It's disingenuous to say that for-profit and non-profit organizations operate the same way. Non-profit organizations face greater scrutiny, and they have additional laws they have to follow. For-profit organizations have an ethical obligation to their shareholders over everyone else.

We can't ignore the fact that 10% of the schools are responsible for almost 50% of the student loan defaults. Non-profit colleges close but not at the rate at which for-profit colleges close. Forty percent of for-profit colleges have closed in the past 10 years.

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Did you know that many endowments come with the stipulation that the money be invested so that the returns can be used for a certain purpose for a period of time or indefinitely? The college is not allowed to spend the entire amount because it's supposed to last forever.

[ss20ts]

I'm well aware of how endowments work. Sitting on $40 BILLION is pretty ridiculous. Oh and read up on that tuition if a family earns less than $125K. It's not as wonderful as it sounds. You also have to be accepted into Harvard. They are extremely selective. Even transferring there is ridiculously difficult. There's no need to put them on a pedestal. They're a business making a profit. All colleges are businesses and they're all making a profit. Being a nonprofit does NOT mean that you don't earn a profit.

You get a great deal of exemptions such as property taxes. Local communities struggle in many college towns because the colleges will own a crapton of the town and pay $0 in taxes. They'll also be the ones using the police and fire departments more than the rest of the town combined. All for FREE! I speak from experience because this is a MASSIVE problem in the city next to the town I live in. Even something that seems minor such as police directing traffic because of their football games costs the city tens of thousands. The college pays $0 for that service! This college owns 197 buildings in the city and pays $0 in property taxes because it's nonprofit. Now if it was a for profit school, it would be paying millions in property taxes. Meanwhile, they also sit on a multimillion dollar endowment which just enrages the locals who are paying property taxes for services that the college receives. This is how it works in many college towns across the nation. It's pretty disgusting.

[sanantone]

You say they're sitting on $40 billion. Then, who's profiting from that money? If it were a for-profit company, someone would be a billionaire with as much money Harvard has taken in. Does Harvard pay out dividends to shareholders?

Harvard's low acceptance rate has nothing to do with the fact that for-profit colleges only have 10% of college students while being responsible for 50% of the student loan defaults. I worked for a small for-profit college, and my former coworkers worked for other small for-profit colleges. Most of them take advantage of minority and economically disadvantaged students. Compared to the local community colleges, their placement testing was a joke. I had students who couldn't read and needed years of remediation, but somehow the placement test indicated they were ready for college-level work.

I did write a lengthy post on the other forum on how for-profit colleges have harmed Black Americans. I'll see if I can find it. You can ignore the statistics, but it doesn't change reality.

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While I search for my write-up on for-profit colleges, you all can watch lectures by Dr. McMillan Cottom. She's studied this issue extensively. She's not a journalist.

https://youtu.be/YfakqK-GyTA

https://youtu.be/uWEOYXv1iEQ

[eLearner]

You say they're sitting on $40 billion. Then, who's profiting from that money? If it were a for-profit company, someone would be a billionaire with as much money Harvard has taken in. Does Harvard pay out dividends to shareholders?

I'm sure you're well aware that non-profits don't have shareholders, but faculty and professors are definitely profiting from the endowment. The average salary of a Harvard Professor was $226,394 per year in 2019:

https://www.businessinsider.com/the-aver...ors-2019-8

But it gets bigger.

"Former president Drew Gilpin Faust, who stepped down in July 2018, made in total compensation in 2018 $3,612,247 (up from $1,707,070 in 2017.)":

https://www.harvardmagazine.com/2020/07/...-employees

Other Harvard administrators are also pulling down very high salaries, and all of those funds come from the endowment, so between them and the professors and faculty, they're eating very very well.