Health Care Law Starts to Unravel
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A major piece of the Obama Administration’s health care reform law has unraveled and is being targeted for full repeal by the business community
The Community Living Assistance and Support Services (CLASS) program, a voluntary long-term care insurance program, was put on hold on October 14 when Health and Human Services (HHS) Secretary Kathleen Sebelius announced that there was ‘no viable path forward’ to implementing the program, a key portion of the administration's signature Affordable Care Act. After 19 months of research and consultation, “we have not identified a way to make Class work at this time,” Sebelius said.
“The Chamber agrees with the Administration’s conclusion that this program is fundamentally flawed and cannot be salvaged,” the Chamber wrote in an October 21 letter to Congress. The Chamber emphasized that the decision by HHS to suspend implementation of the CLASS Act does not negate the need for Congress to fully repeal it. “Unless the CLASS Act is repealed, the temporary protection of this suspension will extend only for as long as implementation is suspended and subject to the whim of the Secretary of the Department of Health and Human Services. It is necessary to eliminate the underlying statutory provisions authorizing the program.”
Financed by premiums paid by working adults, CLASS contains a five-year vesting requirement. Premiums would be paid for five years before any money would be paid out for care.
Because of this requirement, the Congressional Budget Office (CBO) originally estimated that the CLASS Act would reduce the federal deficit by $70.2 billion over a 10-year period. However, the CBO recently announced that the demise of the CLASS Act won’t add to the fiscal deficit, bolstering the Chamber’s argument that repeal won’t require spending cuts to offset any purported savings. “With this prior arbitrary budget hurdle removed, repeal of this provision is both critical and attainable,” the Chamber wrote.
The administration has already come out against full repeal, threatening to veto legislation to repeal it.