Providers
Home Providers Advocacy

Summary of the CLASS Act, Affordable Health Choices Act (Title XXXII)

Loading...

The title creates a new voluntary nationwide long term services and supports insurance program for persons with disabilities and seniors with chronic illness. Long term services and supports are the primary unmet health care needs for these populations.

Key goals of the legislation

  • Supporting America’s workers and future retirees with a new financing alternative for long term services and supports.
  • Promoting individual choice and independence through self-determination.

Premiums

  • Premiums are paid by voluntary payroll deductions through employers with an opt-out option by employees.
  • Premium levels would be set by the Secretary to be actuarially sound for the long term.Preliminary studies suggest this would on average be around $85-$100 per month.
  • Those below poverty will pay no more than $5 per month.
  • Younger participants will pay less than older participants.

Qualification for benefits

  • Individuals must have contributed monthly premiums for at least five years and have been working during three of those years.
  • Individuals unable to perform a specified number (either 2 or 3, as determined by the Secretary) of Activities of Daily Living (ADLs) or have the equivalent cognitive impairment can receive benefits.


Benefits

  • Beneficiaries receive a cash benefit  based on degree of disability or impairment averaging no less than $50 per day.
  • Used to maintain independence at home or in a community residential setting of choice

Relationship with Medicaid and Long-Term Care Insurance

  • Would help many individuals avoid going on Medicaid.
  • Would provide new opportunities for private long-term care insurance carriers to sell wrap around products and/or their current offerings allow private long term care insurance carriers to offer wrap around insurance to individuals.

Solvency

  • CBO concluded CLASS does not cost government a penny over the 10-year period.
  • Consistently maintains a positive balance.
  • Saves Medicaid $2.5B in the first 10 years alone.
  • Legislation mandates HHS secretary to address any changes that need to be made to ensure solvency.

User Comments

Let us know what you think. Please enter your name, organization and comment below.
Reviews
 
Comment #1
The bill is not sound from an actuarial standpoint. Real premiums will have to increase. In addition, the premiums are not put in reserve for purposes of scoring the health reform bills, so the premiums are used to pretend that health reform "reduces the deficit." This will just be another entitlement for which our children and grandchildren will have to pay.
 
Comment #2
I am in the business of implementing private long-term care insurance benefit programs in the workplace. Financing long-term care is one of the biggest problems we face as a country so I would support a sound government program. Unfortunately, the CLASS Act is going to do more harm than good. What the government will save in sales commmissions will be more than offset from the adverse selection built into the program. The solution you describe in your website is only valid with a mandatory program. With a voluntary program projecting a 2% participation rate you need a premium of $160-$240 per month according to the head actuary of CMS, and participation will be limited to the very sick who can afford the premiums. All this is compounded by not budgeting money to educate employees on the need for this coverage; only 3% of all premiums collected can be used for non-benefit purposes. In the end, private long-term care insurance will be more cost effective for younger more healthy people. Despite the fact CLASS i
 
Comment #3
What about those that are already receiving social security?
 
Comment #4
Mary, Thanks so much for your interest. You are correct to note that all the final details are not in the Senate Bill. The legislation calls for the secretary of Health and Human Services to work with independent actuaries and an advisory council to establish the final details after detailed studies using the latest data on rates of disability and the like. In addition, the bill will likely change some as it moves through the legislative process. But, based on the current Senate bill, the news for you is good. Yes, part time work does count! According to the Senate bill, you only need to earn about $1,000/quarter to be counted as “employed” for the sake of qualifying to enroll in the CLASS plan. We can’t say what your premiums would be because that will depend on the final actuarial studies. In general, however, if you enrolled at around age 63 (it may take 2-3 years for the plan to get up and running), you’d pay somewhat more than the overall average (younger people pay less than the average). Bu
 
Comment #5
I am 60 years old, self-employed, part time, and self-insured. If this CLASS Act gets approved when will it begin? If I opt to contribute, I have to do so for 5 years B4 being eligible for benefits and I have to be working 3 of those 5 years. Do I have to be working full time. If so, there is no way at my age, that I can even consider participating. If they do allow part time people to opt in, I may not get any benefits until I'm 75. At my age, what will my premiums be? The $85 to $100/month? Very many questions left unanswered in this review of the program. I have read the Senate Bill and it is equally vague. Mary M. Marks
 Your Rating:
Your Review:
  
Tag Index

View Articles by Keyword

Copyright © 2010, AAHSA. All Rights Reserved.
Log in E-mail Signup
`