The OPM Industry
Understanding How Online Program Managers Work
What are OPMs?
Online Program Managers (OPMs) are third-party companies that partner with higher education institutions to develop, market, and manage online degree programs. These companies are generally for-profit entities that market themselves to colleges and universities as a solution for schools looking to expand their online offerings. OPMs are often responsible for student recruitment, course design, and student support services, among other program functions — yet they are not held to the same government regulations and standards as a college or university. This lack of accountability and transparency encourages a cycle of greed, fraud, and abuse in the higher education system.
Misrepresentation and Deception
OPMs operate behind the scenes, often adopting the branding and identity of the institutions they partner with. Students enrolling in these programs believe they are gengaging directly with the institution – often, a prestigious non-profit school – only to discover that the program is outsourced to a for-profit entity. For example, in PPSL’s Luna v. USC class action lawsuit, the plaintiffs allege that students enrolling in the University of Southern California’s (USC) online Master of Social Work (MSW) program thought they were going to receive the same USC education as in-person students, but were actually enrolled in a program managed by the OPM 2U, Inc.
“When I found out the truth about this program and just how much USC lied to us, I was livid. The fact that the MSW program was used as a moneymaker and to deceive people like myself and the communities that I come from is not okay, and something needs to be done because people continue to be recruited. We were taught that as social workers, our job is to advocate for people who don't have voices and who are from underserved communities, so to have USC preach these values while lying to our faces and taking advantage of us is so hypocritical.”
Stephanie Luna, a plaintiff in Luna v. USC and Mexican-American first-generation college student
Incentive-Driven Recruitment
Many OPM contracts are structured to prioritize profits over student welfare. These contracts often include revenue-sharing agreements, where the OPM receives a percentage of tuition revenue for each student enrolled – often as high as 50% – as well as guarantees of minimum enrollment numbers. This creates a financial incentive for OPMs to aggressively recruit students, using high-pressure sales tactics that reputable institutions would generally avoid.
The Student Impact
Schools typically charge the same tuition for OPM-run programs as they do for their traditional degree programs. The high cost of OPM-run programs often leads to significant student debt, with limited return on investment. Students pay premium tuition rates expecting top-tier education and resources, only to find that much of their tuition dollars have been siphoned off to cover the OPM’s marketing and operational costs. This leaves students financially strained, often without the career advancement opportunities they were promised.
Taking Action
One of the most troubling aspects of OPM-run programs is the lack of regulatory oversight. In response to growing concerns, the Department of Education recently issued guidance reminding institutions of their responsibility to prevent misrepresentations by OPMs. The Department’s “Dear Colleague” letter sent in January 2025 highlights the need for institutions to clearly distinguish between their own employees and those of OPMs.
More robust measures are needed. These include the elimination of revenue-sharing agreements, stricter regulations on aggressive recruitment practices, and increased transparency requirements for institutions partnering with OPMs. Only through comprehensive reform can the higher education system ensure that OPMs operate in a way that benefits students rather than exploiting them.
“PPSL has been on the front lines of fighting predatory for-profit colleges for more than a decade and we know the playbook. As the USC students have alleged in the Luna case, these companies, under the banner of well-known schools, use aggressive marketing and recruitment to mislead students to get them enrolled, max them out with student loans, and then take their profit without delivering what was promised, to the detriment of students and their families.”
Eileen Connor, President and Executive Director of PPSL
In the News
