While accreditation’s purpose has barely changed since the 1950s, the system around it has grown into a compliance maze that neither ensures quality nor empowers consumers.
The National Advisory Committee on Institutional Quality and Integrity sits at the center of an approval process that is opaque, political, and fundamentally misaligned with student needs.
A better path forward would establish a federal outcomes-based eligibility standard managed by the Treasury and a privacy-protected national student-outcomes database for earnings, employment, completion, and value.
Introduction
Accreditation has long been treated as a guarantee of institutional quality, a proxy for trust, and the gateway to federal dollars. Lawmakers rely on it, students assume it protects them, and parents believe it signals excellence. But while its purpose has barely changed since the 1950s, the system around it has grown into a compliance maze that neither ensures quality nor empowers consumers. Today, accreditation largely rewards seat time, inputs, and bureaucratic conformity—not value, performance, or opportunity.
As federal policy shifts and states expand funding models that give students control, the weaknesses of accreditation—and the oversight bodies that support it—matter more than ever. Reformers should take a hard look at the policies and institutions that hold the accreditation system in place.
A Brief History of Accreditation
In his testimony to Congress in 1983, then–Secretary of Education Terrel H. Bell noted that accreditation dates back to the 1800s, when colleges and secondary schools established voluntary regional associations to promote comparability and quality.1 By the 1960s, specialized and professional accreditors had joined the mix, along with a few state agencies, such as the New York State Board of Regents.
In what was originally a voluntary peer-review effort to help institutions compare academic standards, federal policymakers linked accreditation to eligibility for federal student aid in the mid-20th century, transforming a local quality-assurance practice into a national regulatory gatekeeper.
Over time, a growing number of laws linked eligibility for student aid and other benefits to institutional accreditation, creating what Bell called a “statutory nexus between eligibility for Federal funds and peer evaluation through accreditation.”2 From then on, more than a dozen statutes required the Department of Education to maintain a list of nationally recognized accrediting agencies.3
Bell’s argument—and that of the Reagan administration—was that accreditation should remain a voluntary, nongovernmental safeguard of educational quality, not an instrument of federal control. The Department of Education’s role, he said, must remain in the “recognition” lane: selecting agencies that are reliable authorities, not accrediting institutions itself.4
Bell’s successor, Secretary William Bennett, likewise wanted to ensure higher education’s quality and protect taxpayer investment. At the 1985 American Council on Education meeting, he warned, “If the higher-education community does not develop more effective means of evaluating itself, the pressures will grow for such assessment to be undertaken by others.”5 Under Bennett, the department required accrediting organizations receiving federal support to incorporate outcomes measures—linking recognition to actual educational results. It was an early attempt to guard taxpayer investment by connecting funding to performance.
But words like “balance” and “transparency” mean little once filtered through federal bureaucracy. Critics argued that the department’s recognition process had become mired in controversy, inconsistent standards, and opaque decision-making. They feared federal oversight could allow political favoritism toward or against certain sectors—especially for-profit or faith-based institutions.
By the late 1980s, a wave of student aid fraud and school closures exposed the system’s weaknesses: inefficiency, political influence, and uneven quality. In response, Congress passed the Higher Education Amendments of 1992, signed by President George H. W. Bush, which abolished the National Advisory Committee on Accreditation and Institutional Eligibility and created the National Advisory Committee on Institutional Quality and Integrity (NACIQI).6
NACIQI was to operate under clear statutory authority; maintain balanced membership across higher education, students, the public, and accreditors; and provide transparent recommendations independent of the secretary’s agenda. Lawmakers billed the change as a modernization that added transparency, independence, and rigor in recognizing accrediting agencies. In reality, NACIQI only expanded federal influence over accreditation and further politicized the process.
In 2025, NACIQI remains at the center of an approval process that continues to be opaque, political, and fundamentally misaligned with student needs. Recent administrative reforms—including shifting certain federal programs to other agencies—may reduce micromanagement by a singular department, but they do not fix the core structural problems that have allowed failing institutions to persist for decades.
Systemic Flaws, Real Problems
The current system’s failures are not theoretical. They are visible in institutions that remain fully accredited despite single-digit graduation rates, in students who exhaust Pell Grant eligibility on programs that never lead to a job, and in accreditors that rubber-stamp decade-long reviews while missing signs of collapse hiding in plain sight.
Most fundamentally, accreditors rarely revoke approval because of academic failure. Instead, loss of status typically follows financial collapse, not poor learning outcomes. At the state level, weak or politicized oversight can be worse: Licensing and specialty boards often go years without campus visits, with leadership changing annually and boards making appointments for political convenience. Even reform-minded advocates admit that if oversight shifted to states, strong guardrails would be essential to prevent local patronage from replacing federal inertia.
Meanwhile, online learning and artificial intelligence introduce new vulnerabilities. Observers report rising numbers of “Pell runners”—students enrolling mainly to secure aid—and AI tools completing coursework within learning-management systems. Even when they are flagged for plagiarism, such students remain technically active and eligible for funds.
Data gaps persist across federal systems. College Navigator, an online consumer information tool from the Department of Education’s National Center for Education Statistics, contains broad institutional data but no wage outcomes.7 College Scorecard, a similar federal tool, adds salary data—but only for students receiving Pell Grants or federal loans.8 In states like Texas, which heavily subsidizes higher education with the goal of helping students graduate debt-free, it would be valuable to know whether those who never borrow ultimately fare better, though current data make that comparison impossible.
Experts argue that any move toward a national student-outcomes database must fix these blind spots. A model similar to the Integrated Postsecondary Education Data System—requiring institutional self-reporting within standardized guardrails—could balance transparency with efficiency. Without it, the Department of the Treasury, policymakers, and accreditors lack the evidence needed to link quality with fiscal accountability. Even the best accreditors conduct full reviews only once a decade, while NACIQI merely advises the secretary of education—who is free to accept or ignore its recommendations—and leaves taxpayers and students trapped in a cycle in which noncompliance carries no consequences.
From Bush to Biden, each administration has used accreditation as a proxy battlefield for ideology—accountability versus autonomy, regulation versus innovation, and equity versus efficiency. Each change in presidential administration forces colleges to recalibrate policies and priorities, feeding what campus leaders call the “compliance economy.”
Universities now employ armies of staff members to manage accreditation rather than improve teaching. Smaller colleges drown in paperwork. The process rewards conformity over innovation and consumes billions in time, talent, and tuition.
A Better Path Forward: Reimagining the Federal Role
The federal government’s proper duty is to verify that taxpayer-funded aid reaches legitimate, operating institutions—a function better suited to the Treasury Department than the Department of Education. The Treasury already monitors solvency and risk across federally backed sectors. It could apply the same quantitative discipline to higher education, ensuring institutions receiving student aid dollars are solvent, licensed, and capable of delivering what they promise.
Shifting this responsibility would streamline and depoliticize oversight. The Treasury could enforce objective fiscal and performance metrics, eliminating bureaucratic layers like NACIQI that add process but not accountability. The Treasury’s frameworks for banks and lenders could easily extend to colleges. An office of educational finance integrity could replace NACIQI, focusing on financial soundness and consumer protection.
States and independent accreditors would remain free to assess academic quality—creating a dual-assurance model. First, the Treasury would ensure legitimacy and fiscal accountability. Then, accreditors and states could evaluate mission and merit. With transparency at the system’s core, students and families could finally compare institutions based on outcomes, not accreditation logos.
One additional reform would tie it all together: a national student-outcomes database—a transparent, longitudinal system tracking enrollment, completion, earnings, and debt across institutions and accreditors.
Such a database would achieve the following:
Shift the focus from inputs to results—how graduates actually fare.
Give the Treasury measurable data to evaluate students’ return on investment.
Enable risk-based oversight instead of arbitrary reviews.
Reduce duplication and administrative costs.
Empower students with clear, comparable information.
Highlight equity gaps through disaggregated data.
Groups ranging from the Center for American Progress to the Institute for Higher Education Policy have long called for such a system. The National Student Clearinghouse already shows what’s possible; a federal-level database would make it complete, consistent, and public.
If Congress truly wants transparency and accountability, it should let this evidence-based infrastructure exist. A single, secure outcomes system—shared among states, accreditors, and the Treasury—would finally align incentives with reality.
Conclusion
The accreditation process is riddled with issues. It prioritizes process over performance as institutions gain access to billions in aid based on paperwork completion, not student learning, workforce outcomes, or financial viability. NACIQI carries unclear, limited authority that reflects partisan swings rather than a clear, outcomes-based philosophy. Misaligned incentives mean that accreditors face pressure to maintain institutions’ membership rather than enforce strict quality standards.
A better path forward would establish a federal outcomes-based eligibility standard managed by the Treasury along with a privacy-protected, national student-outcomes database for earnings, employment, completion, and value. Other reform avenues should include state-authorized quality compacts, allowing states to approve new models and alternative accreditation pathways tailored to new providers.
If we truly want excellence, accountability must flow to students, not systems. The Treasury can track the money; innovators and states can guard the mission. Only then will America’s higher education system once again reward results over rhetoric—and deliver on the promise of opportunity for all.
About the Author
Jeanne Allen is the founder and CEO of the Center for Education Reform.
