Kennedy Includes CLASS Act
in Health Care Reform Draft

In his draft of the Senate Health, Education, Labor and Pensions (HELP) Committee’s health care reform bill, the Affordable Health Choices Act, Senator Edward Kennedy, Democrat of Massachusetts, has included a provision to establish a new national long-term care insurance program. The bill incorporates the Community Living Assistance Services and Supports (CLASS) Act of 2009, which gives American workers the option of purchasing long-term care insurance from the government.

Kennedy’s long-term care plan is designed to help adults who have functional impairments pay for support services that would allow them to remain independent, employed and a part of their community. By creating a new financing strategy for community-based assistance services and supports, the CLASS Act aims to remove barriers to independence and help persons with functional disabilities pay for housing modification, assistive technologies, personal assistance services and transportation, all of which can be very costly.

The long-term care insurance program would be financed by voluntary premium payments to be collected through payroll deductions, which would be placed in its own separate fund and not available for other government spending. Premiums would average $65 a month, below the current cost of most private coverage for adults in their 50s and 60s. For people living in poverty and students who are working, premiums would be as low as $5 a month.

Under Kennedy’s measure, all working adults would be automatically enrolled in the program, unless they choose to opt out. To qualify to receive CLASS Act benefits, individuals must be at least 18 years old and have contributed to the program for at least five years. Nonworking spouses may also enroll in the program and pay their premiums through an alternative payment procedure. Eligibility for benefits will be determined by state disability determination centers and will be limited to two tiers: Tier 1 benefits ($50/day) will be payable to eligible individuals who have two or more impairments in conducting activities of daily living (ADLs), such as eating, bathing and dressing, or certain cognitive impairments. Tier 2 benefits ($100/day) will be payable to individuals who have four or more ADLs or more serious cognitive impairment. Cognitive impairments include traumatic brain injury, Alzheimer’s disease and other conditions .

The cash benefit will be deposited monthly into a debit account or a “Choice Account”. Individuals who do not use the full monthly amount may roll it over from month to month, but not year to year. However, once an individual becomes ineligible for CLASS Act benefits by improvement in functional status or death, CLASS benefits will end. Any remaining balance of available services remaining on the person’s account will not be payable. If an eligible individual chooses to move into an institutional facility, CLASS Act benefits may be used to defray those expenses.

The cash benefit are meant to allow persons with functional limitations to have more choices and opportunities in how and where they choose to live as well as provide financial help to individuals in obtaining community living assistance services and supports. A goal of the CLASS Act is to make it possible for the elderly and persons with disabilities to live at home and function independently.

-From MEDICARE WATCH, a biweekly electronic newsletter of the Medicare Rights Center, Vol. 12 , No. 12: June 16, 2009.

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