The Community Living Assistance Services and Supports program, known as the CLASS Act, was created under the President’s health care law as a voluntary long-term care insurance program for workers.

Under the CLASS Act workers would pay an affordable sum of around $100 a month or less. In exchange, they would receive a modest daily cash benefit averaging no less than $50 if they become disabled later in life. Beneficiaries could use the money for services to help them stay at home, or to help with nursing home bills.

There were always doubts about its financial viability from the onset. This past week the eight people on the program staff were told they would be reassigned. The Health and Human Services Department would take time to pause the program to reevaluate its viability. It is felt that once the program is paused it will be hard to start it up again.

A central design flaw of the the CLASS Act from the beginning has been unless large numbers of healthy people sign up, there will be soaring premiums for a smaller group of frail beneficiaries eventually destabilize the program.

The Associated Press reported last week on emails showing that technical experts in the government said the CLASS Act could not be kept afloat indefinitely without a taxpayer bailout, or a requirement that workers enroll.

Private long term care insurance is a solution for some, but not all individuals are eligible for private long term care insurance because of pre-existing health issues, so enrolling in the CLASS Act program would be the only alternative for them.

Article Sources: The Associated Press, Wall Street Journal