Republicans conclude CLASS Act should be repealed

By Jesse Slome

American Association for Long-Term Care Insurance

Last week, the Joint Economic Committee, comprised of Republican Senators, issued a report that referred to the CLASS Act as "a Ponzi scheme of the first order" -- a quote attributed to Senator Kent Conrad (D-ND).

CLASS, which stands for Community Living Assistance Services and Supports, was included within the health care reform legislation recently signed into law. The new voluntary federal payroll deduction long term care program will provide a cash benefit to disabled or memory-impaired adults who need help with activities of daily living.

While Congress passed the law including the CLASS provisions, certain key program details including price and benefits have been left to the Secretary of Health and Human Services. In addition, the program start date that many believe won't happen until 2013 has been left to the Secretary's discretion.

The Committee report's conclusion: "As currently designed, CLASS will not be able to sustain itself without subsidies from taxpayers or from all workers in the form of mandatory enrollment."

The report continues, "In addition to being unsound, the program is unnecessary. Americans already have an array of private long term care insurance options to choose from; many are more economical than CLASS, most offer richer benefits."

The report ends stating that "The best remedy for the unsustainable, unaffordable CLASS program is to repeal it."

This is the first time we've heard the word "repeal" when referring to the CLASS Act. I actually wish the federal government would finalize the pricing and benefits for the CLASS plan as soon as possible, because employers and consumers are confused by the lack of details.

The CLASS program is designed to be offered primarily through employers. Workers will then be auto-enrolled, with the right to opt out. The Congressional Budget Office (CBO) estimates that only 3.5 percent of the adult population, or 10 million people, will enroll by 2019.

Individuals and especially employers need to know as soon as possible how much CLASS will cost and whether it will provide only a $50 per-day benefit or one that is higher. It shouldn't take that long to figure this all out.

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