Denise had no idea her student loans could be erased. In 2007, a truck rear-ended her car. The accident ravaged her legs and back, and the pain made it impossible for her to work.
"I have basically been in pain — chronic pain — every day," says Denise, who asked that NPR not use her full name to protect her privacy. "I live a life of going to doctors constantly."
For over half a century, student loan borrowers like Denise — with a significant, permanent disability — have been protected by federal law. If they can no longer work enough to support themselves, they can ask the U.S. Department of Education to erase their debts. But an NPR investigation has found that hundreds of thousands of potentially eligible borrowers — more than enough to fill a city the size of Pittsburgh — have yet to receive the relief they're entitled to.
Not only that, the Education Department told Congress earlier this year it had discharged the loans of 40% of eligible borrowers with significant, permanent disabilities. But new data obtained by NPR from a department official show a much lower number: Only 28% of eligible borrowers identified between March 2016 and September 2019 have either had their loans erased or are on track for that to happen.
Borrowers and advocates say the Education Department doesn't do enough to inform borrowers like Denise of their rights, and those who do apply for help have to navigate a years-long, bureaucratic obstacle course. A department official says the department has made incremental improvements to the process since 2016: "We continue to look for ways to make the process easier to navigate for disabled student loan borrowers, while maintaining the integrity of the taxpayer dollars associated with the discharges."
Denise used her loans to help pay for a bachelor's degree in psychology, and almost a decade passed after her accident before she learned she was eligible for loan discharge. In that time, she qualified for Social Security Disability Insurance, but she struggled to pay down her federal student loans. She says she felt trapped and exhausted. Eventually, she defaulted.
Then one day in 2016, Denise was sitting in her doctor's office, in Queens, New York, waiting to be called in.
"I overheard someone in the waiting room telling someone ... 'You can have your student loan waivered or discharged,'" Denise recalls. She was shocked. But getting her loans erased wouldn't be easy.
In June 2019, according to an Education Department official, 365,000 borrowers were identified as potentially eligible for loan discharge but had not yet gotten relief. And like Denise, 225,000 of those borrowers had already defaulted on their loans.
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"Nobody tells you about it"
"People don't even know about this. They don't find out about it. Nobody tells you about it," says Drew Lehman, another student loan borrower who became unable to work full time after a traumatic car accident. Lehman, 48, is married with two children and took out loans to pay for multiple degrees, including a Ph.D.
He says he, too, struggled to pay down student loans that, unbeknownst to him, could have been discharged. For him, that revelation came not in the doctor's office or in the mail, but on the phone with the company that manages his loans. He'd been trying to find a repayment plan that he could afford — to keep from defaulting. One day, he says, one of the call-center workers surprised him.
"I got the impression that he really wasn't supposed to be telling me about it," Lehman says, "but felt sorry for me ... and he said it kind of quietly, 'Did you know that you can get [your loans] discharged for disability?' "
Lehman remembers pausing, not believing him at first.
The call-center employee told him, " 'Well, I don't really have more information on that for you, but you should look it up,' " Lehman recalls.
After several months of researching and sifting through conflicting information online, Lehman couldn't believe that the landmark Higher Education Act calls for the Education Department to discharge the loans of borrowers who cannot work because "the borrower has become totally and permanently disabled." Borrowers like him.
Lehman remembers wondering how many other borrowers with disabilities were out there, in the dark? It turns out the Education Department had the same question.
For years, the department had made little effort to find and inform eligible borrowers that they could apply for relief. But the Obama administration tried to change that.
For the first time, in the winter of 2015 and the spring of 2016, the U.S. government compared the Social Security Administration's records of Americans who have total, permanent disabilities to the Education Department's database of federal student borrowers. It then made a list of everyone whose name appeared in both: 387,000 people, nearly half of them already in default. Many had even been referred to collection agencies and, like Denise, were seeing their disability checks garnished.
The Obama administration uncovered a serious problem, but didn't completely solve it.
In 2016, the department began sending letters to borrowers it had identified to tell them of their eligibility. But the agency's borrower records, including addresses, are often outdated. (A 2018 NPR investigation found the department's inability to reach borrowers by mail contributed to serious problems in at least one other student aid program.) What's more, because of the way the Social Security Administration categorizes disabilities, some eligible borrowers may not have been identified at all, nor notified of their right to a loan discharge.
Advocates say the government's reliance on borrowers to receive, read and respond to a notice of eligibility in a timely way allows too many vulnerable borrowers to slip through the cracks. The process of discharging loans for such vulnerable borrowers should be automatic, they argue.
A lot of folks have disabilities that, frankly, prevent them from going through the process.
"A lot of folks have disabilities that, frankly, prevent them from going through the process," says Persis Yu of the National Consumer Law Center. For example, a borrower with dementia or whose condition may require long hospital stays may struggle to keep up with paperwork requirements.
What's more, Yu says, the fact that so many borrowers were in default in 2016 "means that they've probably been receiving notices from the Department of Education demanding collection for many years despite not being able to pay for their loans. And so many of them may not be opening the mail."
"They don't trust the mail," adds Johnson Tyler, a senior staff attorney at Legal Services NYC who has been representing Social Security recipients for three decades. Tyler, who represented Denise in a lawsuit against the Department of Education, says many of his clients are skeptical of anything in the mail these days claiming to be good news. To the untrained eye, a letter promising loan discharge from the department can look and feel like a scam, he says.
The "bureaucratic circle"
In addition to problems with the department's outreach to borrowers, the program also includes roadblocks for those who, like Drew Lehman and Denise, learn they're eligible and apply for help.
Tens of thousands of eligible borrowers still don't get their loans discharged, even after submitting an application and being approved by the Education Department. That's because they must first complete a three-year monitoring period in which their loan payments are paused and they have to submit annual paperwork documenting their income.
The irony is that you have to work really hard to prove that you're unable to work.
"The irony is that you have to work really hard to prove that you're unable to work," says Persis Yu.
After being approved for discharge, Drew Lehman and Denise are now in this monitoring period, doing their best not to fail out.
"During that three-year process, tens of thousands of people who are initially approved for that [student loan] discharge have their loans reinstated," says Allison Bawden of the U.S. Government Accountability Office, a federal watchdog. Bawden led the GAO's 2016 review of the loan discharge program and found that borrowers with disabilities often failed out of the program and had their loans reinstated because of paperwork issues.
Bawden says her team looked at the Education Department's income verification form and "found that [the department] did not clearly inform borrowers that failure to return that form and state their income, even if they had no income, would result in their loans being reinstated."
An Education Department official says the department is clarifying its paperwork rules for borrowers and that "information about the three-year monitoring period — and consequences to provide income verification during the period — has been updated online and in borrower communications." The form borrowers must fill out to apply for a discharge is still in the process of being updated.
Bawden says this process, of rejecting eligible borrowers because they failed to return paperwork, has created an enormous amount of extra work for everyone involved. "It begins this sort of bureaucratic circle where you first apply, then you get kicked out, then you come back in through appeal, and it's understandably frustrating."
What's more, by the time many borrowers make it to the three-year monitoring period, they have already endured an often years-long application process simply to receive disability benefits.
"There's a lot of things stacked against you actually getting disability in the first place," Drew Lehman says. Two-thirds of disability claims are initially denied by the Social Security Administration.
"I've spent years trying to deal with this," Lehman says. "The anxiety, the depression, the burden that I face with my family trying to make sure that they're covered. All because of something that wasn't my fault."
I've spent years trying to deal with this. The anxiety, the depression, the burden that I face with my family trying to make sure that they're covered. All because of something that wasn't my fault.
Persis Yu says, "Many people never get the benefits that they're entitled to without going through a lengthy appeals process, which often requires an attorney."
The three-year income-monitoring period was added to limit the potential for fraud by requiring borrowers to report their income, even if they have none.
"You [have] to basically prove that you continued to be unable to work for three years before they finally discharge the loan," says John Brooks, a professor at Georgetown University Law Center.
But Bawden says her GAO team found that "there is no process at Education to verify the accuracy of the information reported." In response to NPR questions, an Education Department official confirmed that borrowers "self-certify" their income information. In other words, tens of thousands of borrowers with disabilities are being denied loan discharges — for not submitting a form that the department does not verify for accuracy.
"The Department of Education is more scared of giving loan discharges to the wrong people than it is of not giving them to the right people," says Brooks.
According to department data obtained by NPR, between March 2016 and September 2019, 555,000 borrowers with significant, permanent disabilities were identified as eligible for loan discharge. Of those, just 200,000 had their loans conditionally discharged and proceeded to the required income-monitoring period. But 75,000 later failed out of the program and had their debts reinstated, most of them because they failed to submit required income paperwork.
"We see this all the time. People think their loans have been forgiven, and they don't respond to this income-certification form," says Johnson Tyler, the attorney at Legal Services NYC.
The Department of Education is more scared of giving loan discharges to the wrong people than it is of not giving them to the right people.
These 75,000 borrowers have the right to appeal the reinstatement of their loans, but NPR found that more than half — 44,000 — have so far failed to do so.
That means, since March 2016, only 156,000 borrowers either had their loans erased, or are on track for that to happen. That's 28% of those the department has identified as eligible — well below the 40% the department reported to Congress. A department official told NPR that 40% was "based on the number of borrowers receiving upfront ... discharges," but the department could not provide NPR with the numbers to substantiate that figure, nor could it tell NPR the time period that 40% reflected.
Fixing the problem
Borrowers and experts say a few straightforward changes could make a big difference. In August, President Trump and Education Secretary Betsy DeVos announced that, in the near future, eligible veterans with permanent disabilities will have their loans discharged automatically. They won't need to respond to a letter or ask for help.
In the Presidential Memorandum announcing the move, Trump offered a scathing critique of the current discharge process, saying it is "overly complicated and difficult, and prevented too many of our veterans from receiving the relief for which they are eligible. This has inflicted significant hardship and serious harm on these veterans and has frustrated the intent of the Congress that their Federal student loan debt be discharged."
The president's move was widely celebrated, but it does nothing for the far larger group of civilians with permanent disabilities who are also legally entitled to the same loan discharge.
"I just don't understand why the Department of Education continues to fail to make good on this opportunity to make a lasting difference in the lives of Americans who've already suffered enough," Sen. Chris Coons, D-Del., tells NPR. Coons is part of a bipartisan group of lawmakers who wrote to DeVos in October. These lawmakers argued that the administration should do for all borrowers with permanent disabilities what it has pledged to do for many veterans: Make loan discharge automatic, instead of opt-in.
"The Department of Education simply needs to match up Social Security numbers and full names and send a notice of discharge, rather than make folks jump through another hoop and another layer of bureaucratic red tape," Coons says.
He adds that such a move is easier now than ever before. In the past, the department hesitated to discharge student loans automatically for tax reasons.
"Before 2018, a person receiving disability discharge could have been hit with a big tax bill, and many were. But the changes to the tax law in 2017 solved that problem," says Brooks, the Georgetown University Law Center professor.
A smaller fix, multiple experts say, would be to automate the troublesome income-verification process so that tens of thousands of qualifying borrowers are no longer punished for paperwork mistakes. In fact, in 2016, Bawden and her GAO team recommended that the department look into doing this very thing.
An Education Department official tells NPR that the department does not have access to the income information it would need to automate the process. However, multiple legal and policy experts say the department has many tools that could make this step much less burdensome.
In the meantime, Drew Lehman and Denise are doing their best to navigate the process, watching the mail for important paperwork. Lehman says he's tired and frustrated.
"I've done everything I was supposed to," he says. "Somehow I'm the crook."
He resents his government's lack of trust and says he's being "treated like I'm trying to defraud the system, when I paid into the system."
Lehman pauses, tamping down the emotion in his voice.
"I just don't think it's fair to most people to treat them that way."
Nicole Cohen and Steve Drummond edited this story for broadcast and for the Web.
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