The Community Living Assistance Services and Supports (CLASS) Act was a provision in the 2010 health care reform act (Public Law 111-148) that was supposed to provide an average benefit of $50 a day depending on the level of impairment with a lifetime (unlimited) benefit period. This benefit would grow each year based on Urban CPI, which typically averages about 3.5%. Long-term care costs have averaged between 5%-6% compound annual growth over the last 24 years. The CLASS program was to have been implemented in 2013. Employees were to be guaranteed acceptance, including employees who already needed help with activities of daily living; i.e. wheelchair-bound. Non-working spouses did not appear to be eligible at all. Premiums had to be paid for at least five years before benefits could be claimed. Employers did not have to offer it, but if they did, all employees would pay with payroll deduction unless they opted out. There would have been other enrollment methods for self-employed and for those employees whose employers did not offer it. This program was shelved in October 2011. (You can see the complete story on why in the November 2, 2011 post on our home page.)
Premiums were never finalized but would vary based on age and time of enrollment. Concerns were two-fold:
- that it would cost much more than projected; and
- that the average daily benefit seemed very small vs. current costs of $150+ per day for eight hours of home care, the cost of which could triple in the next 20 years due to the extreme shortage of caregivers.
The positive side of this program is that even though it was not implemented due to being fiscally unsustainable, the debate over it raised awareness of the essential need to plan for long-term care. Thankfully, the funding for 2012 awareness efforts through September 2012 had been received by the CLASS office before the program was shut down. During that time the CLASS office will be refreshing the www.longtermcare.gov website, developing a new message wrapped around the positive results of planning for long-term care vs. fear-based planning, and launching awareness efforts on the internet.
They are also very willing to work with governors to promote the message of how using long-term care insurance instead of Medicaid to pay for long-term care can make a huge difference in state budgets in years to come.