Institutional Eligibility Under the Higher Education Act of 1965, as Amended; Eligibility of Foreign Medical Schools Under the Guaranteed Student Loan Program (GSLP)

SUMMARY: The Secretary amends the regulations for Institutional

Eligibility under the Higher Education Act of 1965, as amended (HEA),

and the regulations for Eligibility of Foreign Medical Schools under

the Guaranteed Student Loan Program (GSLP) to reflect changes made to

the HEA by the Higher Education Amendments of 1992. The Secretary

removes the latter regulations from Title 34 of the Code of Federal

Regulations, revises them, and adds them to the former regulations as a

new subpart E.

The regulations revise the procedures and criteria under which a

foreign institution establishes eligibility to apply to participate in

the Federal Family Education Loan (FFEL) programs if the institution is

comparable to an eligible institution of higher education located in

the United States.

EFFECTIVE DATE: These regulations take effect on July 1, 1994.

FOR FURTHER INFORMATION CONTACT: Ms. Joyce R. Coates, U.S. Department

of Education, 400 Maryland Avenue, SW., room 4318, Regional Office

Building 3, Washington, DC 20202-5346. Telephone: (202) 708-7888.

Individuals who use a telecommunications device for the deaf (TDD) may

call the Federal Information Relay Service (FIRS) at 1-800-877-8339

between 8 a.m. and 8 p.m., Eastern time, Monday through Friday.

SUPPLEMENTARY INFORMATION: The Institutional Eligibility regulations

contain requirements that apply to all postsecondary educational

institutions that seek initial or continued eligibility to apply to

participate in the programs authorized by the HEA.

On January 18, 1994, the Secretary published a notice of proposed

rulemaking (NPRM) for parts 600 and 601 in the Federal Register (59 FR

2714). The NPRM included a discussion of major issues surrounding the

proposed changes that will not be repeated here. The following list

summarizes those issues and identifies the pages of the preamble to the

NPRM on which a discussion of those issues can be found:

Purpose and scope in Sec. 600.51 (page 2714).

Definitions contained in Sec. 600.52 (page 2714).

Provisions for requesting an eligibility determination contained in

Sec. 600.53 (pages 2714-2715).

Criteria for determining the eligibility of a foreign institution

contained in Sec. 600.54 (page 2715).

Additional criteria for determining the eligibility of a foreign

graduate medical school contained in Sec. 600.55 (pages 2715-2716).

Provisions governing the duration of eligibility determinations in

Sec. 600.56 (page 2716).

These final regulations contain one significant difference from the

NPRM. In Sec. 600.54, the Secretary has added a requirement for a

foreign institution to be a public or private nonprofit institution.

Analysis of Comments and Changes

In response to the Secretary's invitation in the NPRM, 415 parties

submitted comments on the proposed regulations. Most comments were from

persons connected with two foreign graduate medical schools and were

nearly identical. An analysis of the comments and of the changes in the

regulations since publication of the NPRM follows. Substantive issues

are discussed under the section of the regulations to which they

pertain.

Technical and other minor changes--and suggested changes the

Secretary is not legally authorized to make under applicable statutory

authority--are not addressed.

Section 600.54 Criteria for Determining Whether a Foreign Institution

is Eligible To Apply To Participate in the FFEL Programs

Comments: A commenter pointed out that section 481(a)(1) of the HEA

requires a foreign institution to be comparable to an institution of

higher education as defined in section 1201(a) of the HEA, and that the

definition in section 1201(a) requires an institution to be a public or

private nonprofit institution. The commenter suggested that this

requirement be added to the regulations.

Discussion: The Secretary agrees with the commenter that a change

is necessary to make clear that a for-profit institution is not

eligible under these regulations.

Changes: Section 600.54 has been revised to require a foreign

institution to be a public or private nonprofit educational

institution.

Section 600.55 Additional Criteria for Determining Whether a Foreign

Graduate Medical School is Eligible To Apply To Participate in the FFEL

Programs.

Comments: Most commenters opposed the requirement that a training

program for foreign medical students be approved by all medical

licensing boards and evaluating bodies whose views are considered

relevant by the Secretary on the grounds that the Secretary might rely

on the judgments of inappropriate bodies. Some commenters were

concerned that the Secretary might seek the judgment of a State body

over a program located in a different State, if the second State had no

such approving body. One commenter suggested that the Secretary require

the views of boards and evaluating bodies only in those States where

such bodies exist.

Discussion: One purpose of these regulations is to make certain

that facilities, curriculum, equipment, and faculty are comparable in

quality to those of medical schools in the United States. The Secretary

requires the assurance of that comparability through appropriate

impartial and qualified third parties. The Secretary does not consider

it unreasonable for an educational program or portion of a program

located in a State to obtain the approval of an appropriate medical

licensing board or other evaluating body. Which licensing boards and

evaluating bodies the Secretary considers relevant will depend on the

State in which the program is located, and the time that the

application is filed among other relevant factors.

Changes: None.

Comments: Most commenters opposed the requirement for an

institution, rather than the Educational Commission for Foreign Medical

Graduates (ECFMG), to provide pass rate data on its students and

graduates to the Secretary. One commenter believed that the ECFMG would

refuse to release data to institutions, thus effectively denying their

eligibility.

Discussion: It is the responsibility of an institution seeking to

participate in the FFEL programs to establish that it complies with the

requirements for eligibility for that participation. Accordingly, the

institution must furnish the Secretary with the necessary information

for the Secretary to make a determination on the institution's

compliance. Institutions are urged to work with the ECFMG and their

graduates to obtain the relevant data.

Changes: None.

Comment: A few commenters opposed the requirement that a school's

clinical training program be approved by a State as of January 1, 1992,

and remain currently approved by that State. One commenter claimed that

because few States approve clinical training programs for foreign

medical schools, Congress would not have intended to require that

approval.

Discussion: States can and do approve clinical training programs

for foreign medical schools; thus, Congress specifically referred to

that approval in section 481(a)(2) of the HEA for programs approved as

of January 1, 1992. The Congress made clear throughout the Higher

Education Amendments of 1992 the need for strict accountability of

educational institutions to States, accrediting agencies, and the

Federal government. The Secretary would be remiss in his duty to

exercise responsible oversight of the administration of the FFEL

programs if participating institutions were to be permitted to obtain

or maintain eligibility for clinical training programs that, although

once approved by a State, lost such approval. Further, approval of the

clinical training program is among the criteria in the HEA used to

demonstrate comparability to institutions in the United States. A

school that lost its State approval after January 1, 1992 fails this

criterion.

Changes: None.

Assessment of Educational Impact

In the notice of proposed rulemaking, the Secretary requested

comments on whether the proposed regulations would require transmission

of information that is being gathered by or is available from any other

agency or authority of the United States.

Based on the response to the proposed rules and its own review, the

Department has determined that the regulations in this document do not

require transmission of information that is being gathered by or is

available from any other agency or authority of the United States.

List of Subjects in 34 CFR Part 600

Administrative practice and procedure, Colleges and universities,

Consumer protection, Education, Grant programs-education, Loan

programs-education, Reporting and recordkeeping requirements, Student

aid.

Dated: April 11, 1994.

Richard W. Riley,

Secretary of Education.

(Catalog of Federal Domestic Assistance Number does not apply.)

The Secretary amends title 34 of the Code of Federal Regulations by

amending part 600 and by removing part 601 as follows:

PART 600--INSTITUTIONAL ELIGIBILITY UNDER THE HIGHER EDUCATION ACT

OF 1965, AS AMENDED

1. The authority citation for part 600 continues to read as

follows:

Authority: 20 U.S.C. 1082, 1085, 1088, 1094, and 1141, unless

otherwise noted.

2. A new subpart E is added to part 600 to read as follows:

* * * * *

Subpart E--Eligibility of Foreign Institutions To Apply To Participate

in the Federal Family Education Loan (FFEL) Programs

Sec.

600.51 Purpose and scope.

600.52 Definitions.

600.53 Requesting an eligibility determination.

600.54 Criteria for determining whether a foreign institution is

eligible to apply to participate in the FFEL programs.

600.55 Additional criteria for determining whether a foreign

graduate medical school is eligible to apply to participate in the

FFEL programs.

600.56 Duration of eligibility determination.

* * * * *

Subpart E--Eligibility of Foreign Institutions To Apply To

Participate in the Federal Family Education Loan (FFEL) Programs

Sec. 600.51 Purpose and scope.

(a) A foreign institution is eligible to apply to participate in

the Federal Family Education Loan (FFEL) programs if it is comparable

to an eligible institution of higher education located in the United

States and has been approved by the Secretary in accordance with the

provisions of this subpart.

(b) This subpart E contains the procedures and criteria under which

a foreign institution may be deemed eligible to apply to participate in

the FFEL programs.

(c) This subpart E does not include the procedures and criteria by

which a foreign institution that is deemed eligible to apply to

participate in the FFEL programs actually applies for that

participation. Those procedures and criteria are contained in the

regulations for the FFEL programs, 34 CFR part 682, subpart F.

(Authority: 20 U.S.C. 1082, 1088)

Sec. 600.52 Definitions.

The following definitions apply to this subpart E:

Foreign graduate medical school: A foreign institution that

qualifies to be listed in, and is listed as a medical school in, the

most current edition of the World Directory of Medical Schools

published by the World Health Organization (WHO).

Foreign institution: An institution that is not located in a State.

Passing score: The minimum passing score as defined by the

Educational Commission for Foreign Medical Graduates (ECFMG).

Secondary school: A school that provides secondary education as

determined under the laws of the country in which the school is

located.

(Authority: 20 U.S.C. 1082, 1088)

Sec. 600.53 Requesting an eligibility determination.

(a) To be designated as eligible to apply to participate in the

FFEL programs or to continue to be eligible beyond the scheduled

expiration of the institution's current period of eligibility, a

foreign institution must--

(1) Apply on the form prescribed by the Secretary; and

(2) Provide all the information and documentation requested by the

Secretary to make a determination of that eligibility.

(b) If a foreign institution fails to provide, release, or

authorize release to the Secretary of information that is required in

this subpart E, the institution is ineligible to apply to participate

in the FFEL programs.

(Approved by the Office of Management and Budget under control

number 1840-0673)

(Authority: 20 U.S.C. 1082, 1088)

Sec. 600.54 Criteria for determining whether a foreign institution is

eligible to apply to participate in the FFEL programs.

The Secretary considers a foreign institution to be comparable to

an eligible institution of higher education in the United States and

eligible to apply to participate in the FFEL programs if the foreign

institution is a public or private nonprofit educational institution

that--

(a) Admits as regular students only persons who--

(1) Have a secondary school completion credential; or

(2) Have the recognized equivalent of a secondary school completion

credential;

(b) Is legally authorized by an appropriate authority to provide an

eligible educational program beyond the secondary school level in the

country in which the institution is located; and

(c) Provides an eligible education program--

(1) For which the institution is legally authorized to award a

degree that is equivalent to an associate, baccalaureate, graduate, or

professional degree awarded in the United States;

(2) That is at least a two-academic-year program acceptable for

full credit toward the equivalent of a baccalaureate degree awarded in

the United States; or

(3) That is equivalent to at least a one-academic-year training

program in the United States that leads to a certificate, degree, or

other recognized educational credential and prepares students for

gainful employment in a recognized occupation.

(Authority: 20 U.S.C. 1082, 1088)

Sec. 600.55 Additional criteria for determining whether a foreign

graduate medical school is eligible to apply to participate in the FFEL

programs.

(a) The Secretary considers a foreign graduate medical school to be

eligible to apply to participate in the FFEL programs if, in addition

to satisfying the criteria in Sec. 600.54, the school satisfies all of

the following criteria:

(1) The school provides, and in the normal course requires its

students to complete, a program of clinical and classroom medical

instruction of not less that 32 months in length, that is supervised

closely by members of the school's faculty and that is provided

either--

(i) Outside the United States, in facilities adequately equipped

and staffed to afford students comprehensive clinical and classroom

medical instruction; or

(ii) In the United States, through a training program for foreign

medical students that has been approved by all medical licensing boards

and evaluating bodies whose views are considered relevant by the

Secretary.

(2) The school has graduated classes during each of the two twelve-

month periods immediately preceding the date the Secretary receives the

school's request for an eligibility determination.

(3) The school employs for the program described in paragraph

(a)(1) of this section only those faculty members whose academic

credentials are the equivalent of credentials required of faculty

members teaching the same or similar courses at medical schools in the

United States.

(4)(i) The school has been approved by an accrediting body--

(A) That is legally authorized to evaluate the quality of graduate

medical school educational programs and facilities in the country where

the school is located; and

(B) Whose standards of accreditation of graduate medical schools--

(1) Have been evaluated by the advisory panel of medical experts

established by the Secretary; and

(2) Have been determined to be comparable to standards of

accreditation applied to medical schools in the United States; or

(ii) The school is a public or private nonprofit educational

institution that satisfies the requirements in Sec. 600.4(a)(5)(i).

(5)(i)(A) During the academic year preceding the year for which any

of the school's students seeks an FFEL program loan, at least 60

percent of those enrolled as full-time regular students in the school

and at least 60 percent of the school's most recent graduating class

were persons who did not meet the citizenship and residency criteria

contained in 34 CFR 668.7(a)(4)(i) through (iii); and

(B) At least 60 percent of the school's students and graduates who

took any step of the examinations administered by the Educational

Commission for Foreign Medical Graduates (ECFMG) (including the ECFMG

English test) in the year preceding the year for which any of the

school's students seeks an FFEL program loan received passing scores on

the exams; or

(ii) The school's clinical training program was approved by a State

as of January 1, 1992, and is currently approved by that State.

(b) In performing the calculation required in paragraph

(a)(5)(i)(B) of this section, a foreign graduate medical school shall

count as a graduate each person who graduated from the school during

the three years preceding the year for which the calculation is

performed.

(Authority: 20 U.S.C. 1082, 1088)

Sec. 600.56 Duration of eligibility determination.

(a) The eligibility of a foreign institution under this subpart

expires four years after the date of the Secretary's determination that

the institution is eligible to apply for participation, except that the

Secretary may specify a shorter period of eligibility. In the case of a

foreign graduate medical school, continued eligibility is dependent

upon annual submission of the data and information required under

Sec. 600.55(a)(5)(i), subject to the terms described in Sec. 600.53(b).

(b) A foreign institution that has been determined eligible loses

its eligibility on the date that the institution no longer meets any of

the criteria in this subpart E.

(c) Notwithstanding the provisions of 34 CFR 668.25(c)(2), if a

foreign institution loses its eligibility under this subpart E, an

otherwise eligible student, continuously enrolled at the institution

before the loss of eligibility, may receive an FFEL program loan for

attendance at that institution for the academic year succeeding the

academic year in which that institution lost its eligibility, if the

student actually received an FFEL program loan for attendance at the

institution for a period during which the institution was eligible

under this subpart E.

(Authority: 20 U.S.C. 1082, 1088, 1099c)

PART 601--ELIGIBILITY OF FOREIGN MEDICAL SCHOOLS UNDER THE

GUARANTEED STUDENT LOAN PROGRAM (GSLP)

3. Part 601 of Title 34 of the Code of Federal Regulations is

removed and reserved.

[FR Doc. 94-10036 Filed 4-26-94; 8:45 am]

BILLING CODE 4000-01-P