The Pell Grant and the U.S. Healthcare Bill

The media seems to be focusing soles on the advantages and disadvantages of the healthcare bill and the elimination of the Federal Family Education Loan Program student loans. What’s getting lost in the shuffle is the Pell grant. It’s a widely held perception that the average cost of all college degrees for students around the United States will increase if this monumental health care bill is passed. This is not completely correct. The average cost of attending college will increase for some Americans, especially the upper middle class. However, for poor and underprivileged kids the cost of attending college will decrease significantly. Why is that? This is because of the aforementioned Pell Grant.

What is the Pell Grant and how much money can someone receive?

The Pell Grant first came into use in 1965 after the Higher Education Act was passed through congress. The Pell Grant program is an educational federal subsidized program of the United States Dept of Education. Unlike loans, a Pell Grant does not need to be repaid. The students eligible for Pell Grants come from families who wouldn’t be able to pay for college without outside assistance.  Many of these families are minorities from low income neighborhoods. The maximum amount of money awarded through Pell Grants has been slowly increased from $4,050 in 2003 to $5,350 in 2010.

How do you apply for a Pell Grant?

In order to be eligible for a Pell Grant you must show that your family is in financial need. You must fill out a Free Application for Federal Student Aid (FAFSA) form, which requires information  about your family income taxes and household expenses. Families with many members and limited assets are more likely to receive a larger grant. The amount of award you will receive is directly correlated to your Expected Family Contribution. This information is derived from your FAFSA. The majority of Pell Grants were given to students with family earnings of less than $20,000 a year. About 91% of the students who received Pell Grants had families that earned less than $41,000 a year. Students who have received a bachelor’s degree or higher educational diploma are not eligible to receive Pell Grants.

Controversy surrounding Pell Grants

A complaint against Pell Grants is that they are given out to only a small number of schools. The grants often go mostly to historically black schools. Some of the students receiving these grants don’t even end up graduating from school and conservative Americans argue the money is better off being given to students who are more likely to graduate.

President Obama plans to increase the amount of money given to Pell Grant recipients with the passing the Health Care bill. The hope is that with the passing of this bill, the economic gap between the rich and the poor will decrease not that more low-income kids will be able to receive college educations and begin to lift their income status. Obama would also like to see the US regain its position as the nation with the highest proportion of college graduates in its population.

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