Hundreds of Colleges Automatically Bill Students for Books. Is That Fair?

Colleges and publishers say a growing model for purchasing textbooks drives down costs and improves access to course materials, yet critics say it reduces student choice and fails to make a meaningful dent in costs.

The textbook programs are opaque and include a variety of red flags that limit students’ ability to freely shop for course materials, says U.S. Public Interest Research Group in a report published Thursday. A team at the non-profit U.S. PIRG reviewed contracts between colleges and publishers at more 30 institutions, with a combined 700,000 students.

These programs are known as inclusive or immediate access—or automatic billing, according to PIRG. The terms describe a model where the fees for course materials are tacked onto the tuition bill of every student in the course. They typically refer to digital learning materials, including e-books and access codes to online assignments. One major publisher says 600 colleges use inclusive access in at least one course, and the National Association of Collegiate Stores (NACS) found in 2017 that 23% of their member institutions had them, and another 30% said they were considering them.

Supporters say the programs result in lower prices for students, since colleges are able to negotiate lower prices for large-scale purchases. They also give students access to materials on the first day of class, but delay billing them until after the deadline to drop or add classes.

But critics—and PIRG is a strong one—say the agreements only continue a long-standing textbook industry monopoly in which students have limited options and have to pay whatever price they’re given.

Federal rules say such programs must offer materials below a competitive market price and must allow students to opt out. Kaitlyn Vitez, director of the higher education campaign at PIRG, questioned whether those rules are being followed based on the contracts her team was able to access.

The group found discounts were typically about 20% to 25%, yet nearly half of the contracts reviewed didn’t fully disclose the discount structure. In fact, in one case, a publisher said in a letter related to PIRG's public records request that the company would be "disincentivized to continue to offer discounts in the future if these discounts are made public."

PIRG also found 40% of the agreements put limitations on how colleges could publicize the programs, and more than half included quotas, in which a certain number or share of students had to be enrolled in the program in order to get the discount.

“If the discounts are significant enough, then everyone would jump in to buy them,” Vitez said, adding quotas could incentivize colleges to push academic departments to require faculty to use the programs.

In the grand scheme of high college costs, textbooks may seem like small fish. But tales of students forced to shell out $200-plus for required textbooks for one course have been a source of outrage for years.

Not everyone sees inclusive access as a problem, though. In recent years, textbooks are actually a relative success story in college costs, says Richard Hershman, vice president of government relations at the NACS. Average annual spending on course materials has dropped by 40% since 2007, according to NACS surveys. With a push for open educational resources, faculty are increasingly using free materials. One in four courses in Washington state don't have any assigned materials for purchase, a study found.

Inclusive access programs are part of this evolving textbook industry. And while Hershman agrees with many best practices suggested by PIRG, he says he hasn’t seen evidence of the bad behaviors outlined in the report. NACS member institutions, for example, use software to analyze prices across the Internet to ensure discounts are real, and the association's survey found half of students who used the model were satisfied with it.

Along with the contract reviews, PIRG points to a couple recent events as evidence of the problematic nature of the model, including lawsuits stemming from practices at New Mexico State University and Trident Technical College in South Carolina. (Neither are members of the NACS.)

What can students do? Vitez recommends they still comparison shop as much as they’re able. Students can also push administrators to draft agreements that meet PIRG’s recommendations for best practices, including requiring students to opt in rather than allowing them to opt out, clearly outlining the price and discount structure, and removing quotas.

Instead of inclusive access programs, PIRG wants more colleges to use open educational resources. Hershman pointed to a recent review from Ohio's public university library system that found that model saved students on average $186, while inclusive access programs saved students $144. Yet the latter was quicker to bring to scale, meaning more students saw lower prices, even if their discounts were more modest compared with open educational resources.