Education Department Backs Away From Fix to Help Disabled Student Borrowers August 29th, 2011

ProPublica and Chronicle of Higher Education

After suffering from panic attacks and episodes of psychosis, Donita McDonald was diagnosed with a severe mental illness in 2009. She was unable to work or attend school, so the Social Security Administration declared the 21-year-old disabled. After the ruling, McDonald's family turned to the Department of Education, appealing to also have her thousands of dollars in student loans forgiven. The department is supposed to forgive the loans of former students who develop severe and lasting disabilities, such as McDonald.

But rather than accept the Social Security Administration's ruling, the Education Department has forced McDonald to go through a separate, arduous and largely duplicative review that has left her facing continuous collection efforts, even though she is unable to handle her own finances.

McDonald's experience is far from unique. As ProPublica, The Chronicle of Higher Education and the Center for Public Integrity detailed in an article in February [2], the department's dysfunctional process for evaluating disability is keeping many genuinely disabled applicants in debt. Internal reports by the department's own ombudsman found that the program has suffered from "fundamental deficiencies" including "no written medical standards for determining disability," "no formal appeals process" for denials and "undue burden and costs" on borrowers.

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