The GP is correct, domestic students rarely, if ever, pay the true cost of attendance at colleges and universities (hereafter, called 'schools') [1]. The are taxpayer subsidies such as tax breaks (both the publics and privates benefit) to the schools from local and state governments, as well as annual appropriations for operating costs of public schools. This is especially evident in areas where the cost of attendance is so low to in-state residents, such as the California State school system.
Private schools also subsidise students through merit scholarships, which lower the cost of attendance for foreign and domestic alike, to the tune of anywhere between a few hundred dollars and a free ride.
[1] https://www.insidehighered.com/news/2015/06/12/study-us-high...