House Votes to Repeal Affordable Care Act’s Long-Term Care Program

The House of Representatives on Wednesday voted to rescind another portion of the Affordable Care Act. The chamber approved by a 267-159 margin the Fiscal Responsibility and Retirement Security Act of 2011 (H.R. 1173), a measure that would repeal the Community Living Assistance Services and Supports (CLASS) Act, (pdf) the Affordable Care Act’s long-term care program. The Department of Health and Human Services (HHS) already had announced that it was abandoning the program. The CLASS Act would have created a national, voluntary program for individuals to purchase long-term care benefits in the event they become functionally disabled. Adults would have been able to make premium contributions to this program directly or through payroll deductions. Under the terms of the CLASS Act, individuals who made such payments for at least five years and had been employed for at least three of those years would be entitled to cash benefits to purchase needed health and support services – and even certain non-medical needs – based on their degree of disability. The amount of benefits would have varied according to need, but would have averaged no less than $50 per day. The program was slated to begin providing such benefits in 2017.

From its inception the long-term care program has been the subject of sustained criticism, particularly regarding its perceived lack of economic sustainability. Opponents to the program argued that it would not be viable for the long term if employers did not enroll their employees and/or if not enough individuals under age 40 participated. Critics also questioned the affordability of the program’s premiums. According to House Report (pdf) on the CLASS Act repeal legislation, HHS had projected that premiums would exceed earlier estimates. As stated in the Report, HHS estimated that the basic CLASS benefit plan could cost “$235 and $391 a month, and may cost as much as $3,000 per month.”

The Affordable Care Act required HHS to design a plan that would be actuarially sound and financially solvent for at least 75 years. Realizing that the program, as is, would be fundamentally unworkable, HHS Secretary Kathleen Sebelius announced in October 2011 that the agency would not pursue its implementation. In a letter to Congress, Sebelius stated that she does “not see a viable path forward for CLASS implementation at this time.” Sherry Glied, HHS’s Assistant Secretary for Planning and Evaluation, reiterated this position while testifying before a House subcommittee hearing on October 26, 2011. During that hearing, conducted by the House Subcommittee on Oversight and Investigations, Glied acknowledged that HHS has “not identified a way to make CLASS sustainable, legal and attractive to potential buyers at this time.”

Administration officials had expressed hope, however, that the program could be retooled in the future. Because the Fiscal Responsibility and Retirement Security Act of 2011 would excise this program from the Affordable Act entirely, the measure is not without its detractors. The dissenting views contained in the House Report explain that

While a ‘‘timeout’’ for CLASS may be fitting at this juncture in the Program’s brief history, ‘‘throwing in the towel’’ completely simply is not the answer. HHS and Congress should instead learn from experts about how best to make CLASS work and then take the necessary steps to ensure that happens. And until then, CLASS should remain on the law books.

The bill next moves to the Senate for consideration.