In the for-profit college sector, bachelor's degrees often cost students two to three times the price of those offered at state universities.
Rasmussen College aims to eliminate that competitive advantage with a business degree that could cost less than those offered at its public counterparts.
• Topic: Education
The Bloomington-based chain's plans for the low-cost alternative program are in the very early stages. But if it succeeds, by the end of next year Rasmussen will offer what amounts to a $24,000 bachelor's degree. That's less than half of the school's $54,000 standard course, not including books and fees.
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The new degree would build on Rasmussen's new $14,000 associate's degree in business, which uses a form of automated, self-paced learning. It would add a yet-to-be designed $10,000 "completer degree."
"We believe [the $10,000 bachelor's degree] is attainable," CEO Tom Slagle said. "But it's only attainable through providing creative learning models."
Rasmussen already employs one such model, its Flex Choice program, a lower-cost alternative to two of its business-related degree programs.
Flex Choice, which the school rolled out this year, enables students to earn free credit by taking fully automated online courses in general-education subjects and those related to their major at their own pace. The program uses computer simulations designed to test students' competency in various areas.
"I'll call them self-instructional," Slagle said. "They are highly interactive."
Those classes supplement other courses in the program, which are offered online and led by faculty.
Brooks Doherty, Rasmussen's dean of general education, said students have direct access to "academic coaches" when they have technical problems or questions about course content. If the coaches can't answer content questions, they can consult a faculty member who can.
Doherty said Flex Choice is aimed at working adult students with some "life experience" who might want to speed through some subjects they already know and slow down for those they don't.
By taking such courses, students can earn up to 35 free credits out of the 90 required for an associate's degree in business management. Those who do so pay about $14,000 in tuition for the degree.
"This helps the student," Slagle said. The automated Flex Choice courses offer "a lower cost of delivery on the school's part, in that there's not faculty directly involved in the classroom like you'd normally have it."
The question for Rasmussen is how to turn a $14,000 associate's degree into a $24,000 bachelor's degree.
Slagle said he hasn't figured out the details of that yet. Company officials said it could mean expanding the number of Flex Choice courses offered or even cutting tuition.
"We're going to find a way to get to the $10,000 [completer] degree," Slagle said. "I don't have that model completely tuned in yet. I do know Flex Choice is going to be a key part of it."
Slagle said Rasmussen likely will start with business management, "because, frankly, a business degree is becoming one of those commoditized degrees in the marketplace."
If the first degree is successful, he said, the school might expand the program to other business-related degrees and possibly to some in the health sciences such as nursing and health-information technology.
"But we have to prove our case in the business degree first," he said.
If the numbers work out as hoped, Rasmussen's new $24,000 degree could be among the least-expensive business degrees in the state. The price of four years of tuition at Minnesota's state-run universities ranges from $25,000 to about $29,000, depending on the campus.
Rasmussen officials said it was too early for them to discuss how the lower price could affect Rasmussen's competitive position in the market.
In any case, Rasmussen's move would be a new one, said John Slama, communications chairman for the Minnesota Career College Association.
Slama said he was "not aware of any concerted effort to compete as a sector with the public institutions from a price standpoint."