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Life Health > Health Insurance

Health-Care Law’s LTC Program Unsustainable, Republicans Say

By Marlene Y. Satter

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A group of congressional Republicans issued a report on Thursday claiming that a piece of President Barack Obama’s health-care law calling for long-term care insurance, also known as the Community Living Assistance Services and Supports (CLASS) Act, is financially insolvent.

The report, issued by a group of Republican House and Senate leaders, charged with implementing the health-care law, is  titled “Class’ Untold Story: Taxpayers, Employers, and States on the Hook for Flawed Entitlement Program.”  It says, among other things, that the Department of Health and Human Services knew of the program’s shortfalls but kept the information both from Congress and the public. HHS did not return calls for comment.

A year ago, as reported in Investment Advisor magazine, the program was to have required participants to opt out rather than in, to avoid low participation, and the collecting of premiums for five years before people would even be allowed to receive benefits was to have given the coverage a sound financial footing. However, in its final form, apparently none of the provisions that would have made it a workable option remained, according to the report.

Jesse Slome, executive director of the American Association for Long-Term Care Insurance (AALTCI), said of the report, “The president and the Democrats are in an impossible situation. If Democrats throw CLASS under the bus, it opens the door for attacks on other aspects of health-care law. If they defend what they know is an unsustainable program, they are open to political attack as the party who never met an unsustainable entitlement program they didn’t like.”

Last year Slome called CLASS “the legislative elephant in the room.” Now it may be the thing that everyone talks about, although Slome says that it is unlikely that any action regarding CLASS will be taken right away. While the nation has a long-term-care planning problem, he explains, and neither CLASS nor private LTC insurance are universal solutions.

“At some point,” he says, “someone will have to address the nation’s long-term care problem, and that’s when CLASS 2.0, whatever that means, will come to be.”

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