Key Changes for Students, Schools, and Higher Education
A sweeping new law, referred to as the “One Big Beautiful Bill,” recently signed by the President, brings major reforms to education, social assistance, and tax policy. These changes will affect students at all levels, public schools, colleges, and several federal assistance programs.
Expansion of School Vouchers and Impacts on Public Education
The law introduces a federal school voucher program funded through the tax code. Families can receive tax credits to cover educational expenses in private or religious institutions. Participation by states is optional, and eligibility includes households earning up to 300% of the area’s median income.
Medicaid Reforms and School-Based Services
Medicaid eligibility will now require regular verification and work requirements, while federal spending on health is set to decrease significantly. Since many schools rely on Medicaid funds for student health services, including support for disabilities, the law could lead to staff reductions and fewer student services.
Food Assistance Cuts and School Meal Access
Changes to the Supplemental Nutrition Assistance Program (SNAP) reduce eligibility and shift some costs to state governments. This could affect the automatic enrollment of students in free meal programs, impacting access to food for millions of children nationwide.
Student Loan Overhaul and Pell Grant Revisions
Starting in 2026, federal loan limits will be imposed for students and parents. Only two repayment plans will remain. Pell Grants will be extended to cover job training programs, but students receiving full scholarships will no longer qualify.
New Accountability Measures and Endowment Taxes
Colleges will be required to show that graduates earn above high school-level wages to maintain access to federal student loans. Institutions with large endowments will also face higher taxes unless they enroll fewer than 3,000 students.
The “One Big Beautiful Bill” introduces substantial structural changes across the education system, affecting funding, accessibility, and institutional accountability. The impact will vary by state and will depend on how educational institutions adapt to the new requirements.
