H.R. 1, the One Big Beautiful Bill Act, eliminated the Grad PLUS loan program and put in place new borrowing limits depending on program classification. The Department of Education (ED) must create new regulations to define and implement these new loan limits through the rulemaking process.

On January 30, ED published its proposed rule, triggering a public comment period that will be open until March 2.

Sometime after the comment period is over, the Department of Education will release a final rule that will take effect on July 1, 2026.

H.R. 1 eliminates the Grad PLUS loan program, which previously allowed students to borrow up to the full cost of attendance. Beginning July 1, 2026, the law establishes two federal borrowing tiers: graduate programs and professional programs, each with different loan limits.

Before July 1, 2026 (Current System)

• Grad PLUS Loans: No annual or lifetime cap; students could borrow up to full cost of attendance.
• Direct Unsubsidized Loans: $20,500/year; $138,500 lifetime limit (separate from Grad PLUS borrowing).

After July 1, 2026 (New System Under H.R. 1)

• Grad PLUS Loans: Eliminated for new borrowers.
• Graduate Programs: $20,500/year; $100,000 lifetime limit.
• Professional Programs: $50,000/year; $200,000 lifetime limit.

The law defines a professional degree program as one that meets the requirements of section 668.2 of title 34 of the Code of Federal Regulations, which says:

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. Examples of a professional degree include but are not limited to Pharmacy (Pharm.D.), Dentistry (D.D.S. or D.M.D.), Veterinary Medicine (D.V.M.), Chiropractic (D.C. or D.C.M.), Law (L.L.B. or J.D.), Medicine (M.D.), Optometry (O.D.), Osteopathic Medicine (D.O.), Podiatry (D.P.M., D.P., or Pod.D.), and Theology (M.Div., or M.H.L.).

The proposed rule limits “professional” to only the 10 programs explicitly mentioned in 668.2 of Title 34 of the Code of Federal Regulations, plus PsyD and psychology PhD programs that lead towards licensure. All “professional” degree programs, as defined by the proposal, would need to have a 4-digit classification of instructional program (CIP) code, which is in the same group of codes all the fields of student mentioned in section 668.2, Title 34 in the Code of Federal Regulations. This excludes PAs, nurse practitioners, occupational therapists, and many other healthcare professionals.

The proposed rule goes into more detail than the earlier consensus reached through the negotiated rulemaking committee explain why ED did not include PAs, and other healthcare professionals. ED argues that, while the list of examples included in the law’s definition of “professional” is explicitly non-exhaustive, all the examples have “independent” practice that does not require “supervision” by another professional, and that the variance in the level of independent practice for PAs between states means that PAs should not be included as “professionals” for purposed of higher student loan limits. However, this rationale did not appear in the law or in the negotiated rulemaking process.

AAPA has followed discussion of new loan limits closely since they were first discussed as H.R. 1 was being developed, debated, and passed. Before the negotiated rulemaking process where it was first decided that PAs and other healthcare professionals would be excluded, AAPA joined with other healthcare professional associations to urge ED to adopt a definition that would include PAs.

AAPA also closely followed the negotiated rulemaking process, and when ED first signaled this direction in November, AAPA began leading an aggressive effort to persuade ED by mobilizing influential leaders in Congress, and continuing to work with a broad coalition of other provider groups and industry. AAPA advocacy staff have had more than 70 in-person interactions with Members of Congress and staff on Capitol Hill in recent weeks, as part of a multipronged approach that includes supporting legislation sponsored by Rep. Mike Lawler (R-NY) aimed at ensuring the final rule aligns with Congressional intent.

In addition to filing formal comments, AAPA will continue to work closely with Members of Congress and pursue every available legislative, regulatory, and legal avenue to ensure PA students can have access to the financial resources at the higher professional degree limit and the PA pipeline is protected!

When the Department of Education concluded its negotiated rulemaking process to implement student loan portions of H.R. 1, it announced that an agreement was reached by the negotiators that would, among other things, exclude PAs and many other healthcare professionals from newly created “professional” loan limits. Because PA programs were not included in that narrowed list of professional programs, they are excluded from the higher loan caps and categorized under the lower “graduate” limits. This interpretation contradicts what is written into the law and is why we are urging the Department to revise the proposal.

During negotiations, representatives of the Department argued that if they had adopted a more expansive definition of “professional” that went beyond the 10 programs explicitly mentioned in the Code of Federal Regulations (and Psychology programs included in the same 4-digit CIP code group as those 10) while excluding some other programs, they would have opened themselves up to legal action because their regulation would not have a clear basis in law. The Department also argued that they would need more Congressional guidance to adopt a more expansive definition of “professional” program. In the proposed rule, ED also argues, based on a flawed understanding of “supervision,” that varying state laws regarding supervision of PAs would prevent PAs from being included under the definition of “professional.”

However, AAPA believes the rationale for excluding PAs in the proposed rule does not have a clear basis in law.

No. If finalized, the new limits will only apply to new federal borrowers after July 1, 2026. Borrowers who already have loans will not be affected.

While we cannot be sure about the effects of this policy change, the stated rationale for eliminating the unlimited Grad PLUS program and setting a lower limit for most graduate borrowing was to push educational institutions to lower costs. However, the same effect would presumably apply to the “professional” education programs the Department of Education ultimately included in the proposal negotiators agreed on, and AAPA believes the law does not limit the definition of “professional” to just those programs.

Further, the programs explicitly mentioned in the Code of Federal Regulations as examples of “professional” programs have little in common, and thus it is unlikely they were intended to be singled out as professional programs more deserving of higher federal loan limits than PA programs and other healthcare professional programs.

AAPA applauds U.S. Rep. Lawler and supports his hat bill. However, the legislation (The Professional Student Degree Act) must move through Congress and be signed into law and would be unlikely to pass before loan limit changes take effect in July.

ED is continuing to implement H.R. 1 through the regulatory process, and their interpretation would exclude PA programs from the professional loan category. Overall, AAPA is pursuing multiple fixes at once, legislative and regulatory, to protect PA students.