Higher Ed ‘Do Not Resuscitate’ Orders

Abstract

Congress has effectively precluded all institutions of higher education from reorganizing in the bankruptcy courts because it was concerned about exploitative profiteers opening fly-by-night colleges, defrauding students, and then finding refuge there. This choice harms students, employees, creditors and communities. As such, this Article advocates that Congress should reverse its decision and allow colleges to reorganize in bankruptcy. To support this argument, this Article contrasts the bankruptcy treatment of healthcare enterprises to that of higher education enterprises. In doing so, this Article builds on my own prior work and contributes to the literature on higher education bankruptcies.

Keywords: Bankruptcy, Higher Ed, College, Universities, Bankrupt, Debtor, Healthcare, Chapter 11, Higher Education, Reorganization, nonprofit, for-profit, restructure, Title IV, Medicare, HHS, CMS, reorganize, fly-by-night, profiteer, chapter 9, Code