The general consensus is that the Patient Protection and Affordable Care Act (“OBAMACARE”) is bad medicine. Doctors, patients, businesses, taxpayers and politicians have all called for the repeal of Obamacare. While that is the desire of many, to repeal and start over may never happen. However, it may be possible to dismantle parts of it, one piece at a time. The Foundry, a conservative policy blog from the Heritage Organization reported earlier this month that while the Fiscal Cliff debate took place in Washington, the bill that eventually passed included the repeal of one of Obamacare’s worst provisions, the COMMUNITY LIVING ASSISTANCE SERVICES AND SUPPORTS ACT (CLASS).
CLASS is nothing of what the name implies. It establishes a voluntary insurance program for American workers to help pay for long-term care services and support they may need in the future. By law, CLASS benefits must be funded entirely through enrollee premiums WITHOUT any taxpayer subsidy. The requirement is that the program be solvent over a 75 year period.
Department of Health and Human Services Secretary Kathleen Sebelius received a letter in 2011 from the CLASS Administrator, containing findings and recommendations regarding CLASS from the various offices. The findings documented policy, marketing and legal analyses.
The offices were charged with performing a broad and thorough analysis to design benefit plans to meet the twin tests of solvency and legality. Two trouble areas were identified that held wide-sweeping uncertainty. The first were detrimental assumptions used in the models for assessing solvency. Second, since CLASS requires no taxpayer funds to pay for benefits, you would expect it to articulate a backup plan for the necessary funds. After all, any good business plan is never put together without a back out strategy. Unfortunately, CLASS is silent about what would happen at some future point if financial soundness could no longer be achieved.
Under CLASS, premiums would wind up costing more with average daily benefits being much less than private LTC availability. Heritage reported that many experts warned that the program would require either a mandate to participate or a permanent taxpayer bailout.
The recommendation in 2011 from the Administrator was to not move forward with CLASS at that time. Regardless, it wound up in ObamaCare. Even though there is a real need for affordable long-term care, it must not be an added burden on the taxpayer, especially since the private sector can do a much better job.
Thankfully, one part of Obamacare has been removed and it may offer an indicator and a roadmap for the future of how to deal with an ensuing litany of new implementing regulations.