Last month, the U.S. Department of Education made two high-profile announcements related to the regulation of third-party vendors, including Online Program Managers (OPMs) that contract with Title IV-eligible colleges and universities.

The news may have implications for a wide range of companies once viewed as beyond the scope of federal regulations, including vendors that focus on non-academic domains.

First, the Department announced that it will hold a series of listening sessions to understand the impact of the “bundled services” exception to its ban on incentive compensation. As currently written, this safe harbor allows for revenue-sharing agreements between institutions and third-party organizations, and is frequently utilized by OPMs.

Second, the Department released a new Dear Colleague Letter that significantly expands the definition of a Third-Party Servicer (TPS). While the move is meant to include OPMs under the requirements for a TPS, the definition is much broader — and appears to include a range of entities that partner with colleges and universities, including those that help students enter and complete a program that is Title IV eligible. 

W/A’s Alison Griffin and Noah Sudow and HMBR’s Charlie Rose and Dennis Cariello hosted a virtual discussion on the history and context for these announcements, what they include, and what the future may hold.