(1) As used in this act, "postsecondary educational institution" means a public or private institution in this state that offers a degree or course of study beyond the twelfth grade and receives state or federal funding of any kind.

    (2) A postsecondary educational institution shall not uphold any rule, requirement, standard, or other limitation that prevents a student of that institution from fully participating in intercollegiate athletics based upon the student earning compensation as a result of the student's use of his or her name, image, or likeness rights. Earning compensation from the use of a student's name, image, or likeness rights shall not affect a student's scholarship eligibility or renewal.