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Despite mediocre records, for-profit online charter schools are selling parents on staying virtual

Virtual for-profit charter school enrollment is surging across the nation, despite the fact that many are rated as unacceptable in the states where they operate. (iStock)
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In August 2020, Amanda Nemergut was looking for alternatives to in-person public school for her three daughters. Her fourth-grader, Paige, has ulcerative colitis, and she worried about the risk from the coronavirus of sending her back. Her other two girls, in third and fifth grades, would be home on alternating days under the school’s hybrid schedule. She had enough to manage with her evening bartending job, so she was seeking a simpler option.

Then she saw an online ad for the Ohio Distance and Electronic Learning Academy. It’s a virtual charter school, the tuition paid with taxpayer dollars, run by the for-profit charter management company ACCEL Schools. The school’s website promised a “rigorous education experience” delivered by highly qualified teachers. Nemergut enrolled all three girls.

Soon Nemergut and her kids, who live in Conneaut, Ohio, noticed problems. OHDELA’s model relies on parents to help supervise their children’s instruction, and Nemergut did, stepping in throughout the day to aid with technical glitches and questions on assignments.

But there were issues she couldn’t fix: The homework didn’t match the material teachers covered in class. When teachers gave live instruction — no more than 20 minutes per class, Nemergut estimated — students couldn’t ask questions because chats were blocked. When her daughters sent questions by email, they got no answer. Teachers didn’t give credit for work her kids had turned in and marked them absent for classes they attended, she said.

“My kids were like, ‘What are we doing wrong?’ And I said, ‘You guys aren’t doing anything wrong. It’s the school,’ ” said Nemergut. When she complained to teachers, they blamed technical support or the curriculum designers, she said. Her daughters’ grades fell; her third-grader went from getting A’s and B’s to failing all her OHDELA classes.

Virtual learning is the new fault line in education: It’s either on the way out or on the rise

As parents fearful of the coronavirus’s spread and frustrated with their schools’ forays into remote learning seek other options, they are increasingly turning to virtual for-profit charter schools like OHDELA. The school’s enrollment more than doubled, to about 5,200 students, in the 2020-2021 school year, according to state data. At Stride Inc., the nation’s biggest for-profit operator of charters, enrollment grew by 45 percent, to almost 157,000, and revenue in its general education division rose 37 percent. Pearson, the parent company of Connections Education, the second-largest for-profit online charter operator, reported enrollment growth in its virtual schools division of 20 percent in 2020.

One reason for the growth is the sort of advertisement that attracted Nemergut, which often touts the schools’ vast experience in online instruction and teachers who are specially trained in remote learning. Equipped with big advertising budgets, the schools have stepped up their marketing during the pandemic, often advertising on social media or other children’s web channels.

Yet the advertising belies these schools’ records serving students. OHDELA gets an F rating from the Ohio Department of Education, receiving failing marks on measures including students’ performance on state tests, academic growth and graduation rates.

Overall, about 63 percent of virtual for-profit schools — most of which are charter schools — were rated unacceptable by their states in the latest year for which data was available, according to a May report by the University of Colorado’s National Education Policy Center (NEPC). Online charters typically lag behind other schools on measures including student academic outcomes and graduation rates, and they have also been plagued by high student turnover.

Spokespeople from the schools say the criticism doesn’t reflect the fact that they often enroll students who are struggling academically, are enrolled for short periods and have a history of changing schools frequently, a metric shown to hurt academic performance. They also say they are taking steps to improve retention and graduation rates. Courtney Harritt, a spokesperson for ACCEL, said by email that OHDELA’s enrollment surge hit just as the school year started, creating operational challenges, and that ACCEL is making changes after taking over the school from another company in 2018.

But with years of poor performance dogging many of these schools, experts worry about students getting left behind academically if more families opt for them.

“It’s really easy for [these companies] to expand and just incredible how much profit they make,” said Gary Miron, an education researcher who was the co-author of the NEPC report. “For 12 years we’ve been documenting their disastrous outcomes, and they’re just resilient.”

Virtual for-profit charter schools got started in the early 2000s. In the 2019-20 school year, more than 330,000 students attended virtual schools, roughly 60 percent of them at for-profits, according to the NEPC.

When the pandemic hit in March 2020, the leaders of virtual charter companies quickly recognized a chance to attract more students to their rolls. “We believe the effects of covid-19 will be a lasting tail wind to online education and especially to K-12’s business model,” Timothy Medina, chief financial officer of Stride, told investors on a call the following month.

More recently, the spread of the delta variant has contributed to the executives’ optimism about their companies’ continued growth. “[A] lot of the states that have spikes in delta variant, places like Texas, we just see sort of unprecedented demand,” James Rhyu, Stride’s chief executive officer, told investors in August.

Stride spent about $1.8 million on TV ads in just the first quarter of the year, up from $1.2 million in the same period last year, according to an analysis for the Hechinger Report conducted by the consulting firm Kantar Media. Connections Education spent $1.2 million in that period, almost quadruple last year’s spending, the analysis showed.

How the pandemic is reshaping education

Yet years of school ratings and student-level data consistently show subpar performance among schools run by for-profit charters. Of the 47 Stride schools that received ratings in the latest academic year for which data was available, 34 were rated unacceptable by their states, according to the NEPC. Of the 28 managed by Connections Education, 16 were found unacceptable.

These schools often defend their performance by saying their students are different — they’ve fallen behind academically because of social, emotional or medical issues that make it challenging for them to attend brick-and-mortar schools. But a 2015 study by a Stanford University research team compared academic outcomes of students at 158 online charter schools in 17 states with those of students in bricks-and-mortar schools in their states who were matched on numerous characteristics, including prior test scores. The numbers were stark: The online charter students lost the equivalent of 72 days of learning in reading and 180 days of learning in math, based on a 180-day school year.

Often, as Nemergut discovered, virtual charters provide minimal instruction and require that parents give academic support to their kids. The typical online charter offers just three to four hours of live instruction per week, less than what students in bricks-and-mortar schools get in a day, according to a 2015 report from Mathematica Policy Research. The schools tend to be lightly staffed, too: In 2019-20, for-profit charters averaged about 29 students per teacher, compared with 16 per teacher at public schools, according to the NEPC.

Many parents, unaware of the history of virtual charters, continue turning to these schools. Last school year, Vermonica Murphy, 49, enrolled her and her husband’s son, Ernest Murphy Jr., in the Cyber Academy of South Carolina, a publicly funded school run by Stride. “They’re advertised as one of the best schools, so I thought, ‘Maybe we can get in there,’ ” she said.

But soon she and her husband noticed that Ernest Jr. was receiving only 15 to 20 minutes of live instruction in each of his four classes: English, math, history and science. For the rest of the time, he was on his own with their help, they said. He seemed increasingly disengaged and didn’t complete most of his work, his parents said. A former honor roll student, he ended the 2020-21 school year failing all four courses, Murphy said.

The school disputes the family’s account. David Crook, CASC head of school, wrote in an email that students get 45 minutes of live instruction in each class.

But CASC has consistently performed poorly on state measures of school effectiveness. According to the state education department’s report card, the percentages of its middle-schoolers meeting or exceeding grade-level expectations was lower, and in some cases far lower, than the South Carolina statewide averages in English, math, science and social studies in the two most recent years for which data was available.

Crook said the report card figures are “not an accurate or comprehensive depiction of student achievement or student progress” because of changes in tests, curriculums and other factors. Ryan Brown, a South Carolina Department of Education spokesperson, wrote in an email that “the information contained on report cards is accurate.”

Some education advocates are demanding that states do more to hold for-profit charters accountable. In most states, schools are funded based on how many students they enroll, regardless of whether those students succeed in school or even finish the academic year.

But a few states — including Florida, Minnesota, Missouri, New Hampshire, Texas and Utah — have started moving toward performance-based funding mechanisms for virtual schools, according to the Education Commission of the States, which tracks state education policy. Under a 2018 law in Missouri, for example, virtual schools are paid a prorated monthly cost based on students’ completion of assignments and assessments.

Still, some education experts are skeptical that such changes will make a difference. “As soon as you put profit in the mix, then you put marketing in the mix,” said Carol Corbett Burris, executive director of the nonprofit Network for Public Education. “A lot of these parents, I think, are victims. They are victims to the marketing push.”

Amanda Nemergut, for one, is through with virtual charter schools. This fall, her children’s school district reopened for in-person classes. Her daughters told her they were very excited to be going back, she wrote by email. Her girls, she added, “don’t ever want to experience online school again.”

This article about virtual charter schools was produced by the Hechinger Report, a nonprofit, independent news organization focused on inequality and innovation in education.