CLASS Act

Which genius is Washington thought up this?

Benefits in the Class program, which was supposed to start up next year, are rigged by an unusual five-year vesting period. So the people who sign up begin paying premiums immediately—money that Democrats planned to spend immediately on other things, as if the back-loaded payments to Class beneficiaries would never come due. The $86 billion or so that would have built up between 2012 and 2021 with the five-year lead is supposed to help finance the rest of ObamaCare. The Class program would go broke sometime in the next decade, but that would be somebody else’s problem.

So, lemme get this straight. This is supposed to be a national, government run – with government quality oversight- long term care insurance program. Yea, that was going to work.

Despite warnings from the very beginning that this would be a major fail, Obama pushed it through because that five years of lucra before the benefits kicked in was supposed to help pay for Obamacare. Apparently, even the administration doesn’t believe that heap of merde anymore:

The future of the long-term care insurance program created under Obamacare — known as CLASS — has been in doubt ever since the administration said last week that it plans to reduce the number of staffers dedicated to the program. The CLASS actuary even hinted the entire CLASS office might close. Health and Human Services Secretary Kathleen Sebelius has said the administration won’t implement the program if it is fiscally unsustainable — and, as the financial viability of the program was in doubt even before the program passed, sustainability seems like an unrealistic dream.

But the entitlement crowd says they were promised, and the AARP and Unions are urging Obama to implement the program:

“Mr. President, Congress gave you the authority to make necessary changes to the design of CLASS to make it work,” the letter states. “We fully expect the Administration to go forward and use that authority in implementing the law.”

It just so happens one of the signatures on the letter comes from Constance “Connie” Garner. Now the executive director of Advance CLASS, Garner was Sen. Ted Kennedy’s lead staffer on the Senate Committee on Health, Education, Labor and Pensions at the time of the original push for CLASS. As Garner was privy to internal communications about the program, she ought to know better than anyone that, as Kent Conrad put it, the program is “a Ponzi scheme of the first order” or what federal health experts called an “insurance death spiral.”

Quick review – the CLASS act was one of the backbones of the “deficit reduction” benefits of Obamacare.

Half of ObamaCare’s supposed deficit reduction comes from the Community Living Assistance Service and Supports (CLASS) Act, a long-term care benefit tacked onto the bill and scored as reducing the deficit by about $70 billion over the next decade.

Which, not true.

The score counted premiums collected this decade as reducing the deficit despite the fact that they’ll be needed to pay out benefits later. Even worse, the premiums won’t be enough to pay for all of the benefits: In the long-term, the program isn’t self-sustaining, and will actually add to the federal deficit.

Oops.

So it was all a big mistake, and ObamaCare’s defenders just found out too late? Nope. They knew the program wasn’t fiscally sound. And they lied about it.

They … lied? *lip quivers.

And, the premiums wouldn’t be cheap ($5 as they touted early on for the poor) Depending on participation, the monthly premiums range rather expensive for even young people (what young person would pay $89 – $215 for future long-term care), to outrageous for the elderly.

Now, for the bad news.

All of this would seem to make repealing Class an easy vote for Congress, but, this being Washington, it isn’t. Since the CBO says Class’s front-loaded collections cut the deficit to the tune of that $86 billion, HHS has to pretend that the program is still alive to preserve these phantom savings.

Some Republicans are also nervous about repealing Class because, under CBO’s perverse scoring, they’ll be adding $86 billion to the deficit. Others would prefer not to repeal any of ObamaCare until they repeal all of it, on grounds that some of it might survive if the worst parts go first.

So an unaffordable entitlement that will be a perpetual drain on taxpayers may continue to exist because of a make-believe budget gimmick that everyone now admits is bogus. Congress can’t reduce real future liabilities because it would mean reducing fake current savings.

This is literally insane. It’s rare to get a political opening to dismantle any entitlement, much less one as large as Class. House Republicans ought to vote to repeal it as soon as possible as an act of fiscal hygiene, forcing Senate Democrats to vote on it and President Obama to confront (even if he won’t acknowledge) the fraud he signed into law.

*cries

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