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For-profit educator closing 12 campuses in 11 states

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The dozen campuses that for-profit education company Corinthian Colleges Inc. is closing operate under the Everest name and are scattered in 11 different states, including Indiana, the company announced Tuesday.

The Santa Ana, Calif.-based company, which competes against Carmel-based ITT Educational Services Inc., reached an agreement with the US. Department of Education late last week that has it shutting down those campuses and putting 85 U.S.-based campuses up for sale. About a dozen others in Canada also will be sold.

Corinthian, ITT Educational and other for-profit college companies have been under increased scrutiny and tighter regulation in recent years.

About 3,400 of the 72,000 students who attend schools owned by Corinthian — owner of Everest College, Heald College and WyoTech schools — will be affected by the closures, the company said.

Among those closing is the Merrillville campus in northwest Indiana.

Also closing are campuses in Bensalem, Pa.; Chelsea, Mass.; Cross Lanes, W. Va.; Eagan, Minn.; Fort Worth, Texas; Grand Rapids, Mich.; Kalamazoo, Mich.; Salt Lake City, Utah; St. Louis; Silver Spring, Md.; and McLean, Va.

Last month, the department put Corinthian on heightened financial monitoring with a 21-day waiting period for federal funds. That was after it failed to provide adequate paperwork and comply with the department's requests to address concerns about the company's practices. The department said the concerns included allegations of falsifying job-placement data used in marketing claims to prospective students, and allegations of altered grades and attendance.

Under the terms of the agreement, the campuses must tell students their options and each campus will have a plan that allows students to finish their program, if they choose to do so. Some are eligible for a refund.

The company faces multiple state and federal investigations.

Corinthian shares traded at 22 cents each Tuesday morning, down from $1.78 at the end of 2013.

ITT Educational shares fell 22 cents, or 1.4 percent, early Tuesday, to $16.12 a share, after falling 2.2 percent Monday. The stock has lost 52 percent of its value since the beginning of the year.

Apollo Education Group Inc. shares fell 1.2 percent Monday, to $30.85, and Career Education Corp. shares declined 6.7 percent, to $4.62.

 

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  1. You are correct that Obamacare requires health insurance policies to include richer benefits and protects patients who get sick. That's what I was getting at when I wrote above, "That’s because Obamacare required insurers to take all customers, regardless of their health status, and also established a floor on how skimpy the benefits paid for by health plans could be." I think it's vital to know exactly how much the essential health benefits are costing over previous policies. Unless we know the cost of the law, we can't do a cost-benefit analysis. Taxes were raised in order to offset a 31% rise in health insurance premiums, an increase that paid for richer benefits. Are those richer benefits worth that much or not? That's the question we need to answer. This study at least gets us started on doing so.

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  3. Jim, thanks for always ready my stuff and providing thoughtful comments. I am sure that someone more familiar with research design and methods could take issue with Kowalski's study. I thought it was of considerable value, however, because so far we have been crediting Obamacare for all the gains in coverage and all price increases, neither of which is entirely fair. This is at least a rigorous attempt to sort things out. Maybe a quixotic attempt, but it's one of the first ones I've seen try to do it in a sophisticated way.

  4. In addition to rewriting history, the paper (or at least your summary of it) ignores that Obamacare policies now must provide "essential health benefits". Maybe Mr Wall has always been insured in a group plan but even group plans had holes you could drive a truck through, like the Colts defensive line last night. Individual plans were even worse. So, when you come up with a study that factors that in, let me know, otherwise the numbers are garbage.

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