Obama Scraps Long-Term Care Plan, Many Still Uninsured
The Obama Administration said Friday it cannot implement a long-term care insurance plan in a way that is financially sound as required by the 2010 Affordable Care Act.
Long-term care includes nursing homes, and home health aides.
The CLASS, or Community Living Assistance Services and Supports program, was a voluntary insurance plan that was meant to operate entirely on enrollee premiums, without taxpayer subsidy.
By paying a premium, participants could later collect monetary benefits at a future time if they were to become disabled. The money could be used for services or nursing home bills.
“[D]espite our best analytical efforts, I do not see a viable path forward for CLASS implementation at this time,” wrote Kathleen Sebelius, head of the Department of Health and Human Services in a letter addressed to Congress.
The 2010 law required that the plan would have to be “actuarially sound and financially solvent for at least 75 years.”
A report which accompanied Sebelius’ letter notes that costs for nursing home care vary widely, and cost anywhere from $70,000 to $80,000 per year.
Only about 2.8 percent of Americans currently have a long-term care insurance policy, according to the report.
Sebelius said the knowledge gained in studying possible solutions “will ultimately advance the cause of finding affordable and sustainable long-term care options.
She added that a solution is still needed, as an estimated 15 million Americans will need some kind of long-term care. She said if the problem is left unaddressed, more Americans with disabilities will rely on another government program, Medicaid, once their assets are depleted, “putting further strain on State and Federal Budgets.”
The full report on the CLASS Program can be found here.