Though initially touted as a plan that would kill two birds with one stone—saving the government billions of dollars while providing affordable long-term care insurance for the elderly and disabled—the Obama administration has temporarily deserted the CLASS Act.
As reported by the Associated Press, the actuary appointed to the CLASS Act office resigned a few weeks ago. He departed amid a swirl of rumors saying that the Department of Health and Human Services (HHS) was in the process of shutting down the office of the as-yet-to-be-implemented program.
The administration staunchly denied rumors of the program's demise saying, "we are continuing our analysis of this program."
They go on to remind the public that there was never any guarantee that the program would be formally instituted—it all depends on if (and when) the numbers add up. Outlined in the CLASS Act's description is the stipulation that the plan would not go into effect unless it is deemed to be self-sustaining.
What is the CLASS Act?
Originally passed as part of the Affordable Care Act, the CLASS Act is, in essence, a long-term care insurance program. Under the plan, people can choose to pay monthly premiums out of their paychecks for the opportunity to receive future benefits to help them pay for long-term care if they become disabled or come down with a chronic illness. While the program will not cover every long-term care expense, benefits would be based on individual needs, and its payouts would never be less than $50 a day.
Also included in the guidelines is the provision that the CLASS Act will not begin issuing benefits until five years after it has been formally implemented. This is expected to help ensure the solvency of the program.
Uncertain Future of Long-Term Care Assistance
Originally, enrollment in the CLASS Act was slated to begin sometime next fall, but this date was recently pushed back to 2013.
Last Friday, HHS Secretary Kathleen Sebelius wrote a letter to Congress outlining the future of the CLASS Act (or lack thereof). In the letter, she states that, "despite our best analytical efforts, I do not see a viable path forward for CLASS implementation at this time." Translation: the program has been suspended until further notice.
A report detailing the department's findings was included with the letter.
While an actionable plan appears to be out of reach at this time, Sebelius says that the government is not giving up trying to help make long-term care more affordable for the elderly.