The federal role in higher education has grown over the past two decades, and now a new administration has the opportunity to strengthen policies that support students and their colleges and universities. To help inform these decisions, the Urban Institute convened a bipartisan group of scholars and policy advisers to write a series of memos highlighting some of the most critical issues in higher education and recommending policy solutions. This memo suggests ways the federal government could leverage funding and alter the regulatory environment to incentivize more innovation among higher education institutions. [This is part of the "Memos to Congress and the Administration on Higher Education" collection. For a summary of the memos, see "A Principled Federal Role in Higher Education" (ED578885).]