Obama Scraps Long-Term Health Coverage Before It Starts

One of the less ballyhooed parts of ObamaCare has been tossed aside as too expensive before it even went into effect.

One of the less ballyhooed parts of ObamaCare has been tossed aside as too expensive before it even went into effect.

NYT (“Obama to Scrap a Portion of Health Care Law“):

The Obama administration announced Friday that it was scrapping a long-term care insurance program created by the new health care law because it was too costly and would not work.

Kathleen Sebelius, the secretary of health and human services, said she had concluded that premiums would be so high that few healthy people would sign up. The program, which was intended for people with chronic illnesses or severe disabilities, was known as Community Living Assistance Services and Supports, or Class.

“We have not identified a way to make Class work at this time,” Ms. Sebelius said. She said the program, which had been championed by Senator Edward M. Kennedy, Democrat of Massachusetts, was financially unsustainable.

Kathy J. Greenlee, the assistant secretary of health and human services in charge of the program, said: “We do not have a viable path forward. We will not be working further to implement the Class Act.”

[…]

Two early critics of the Class program — Senator John Thune of South Dakota and Representative Charles Boustany Jr. of Louisiana, both Republicans — said they had been vindicated.

“The Obama administration ignored repeated warnings about the financial solvency of this massive new entitlement and suppressed information on the viability of the program,” Mr. Thune said.

In an interview, Mr. Boustany said that “in their haste to get the bill passed,” President Obama and Congressional Democrats ignored warnings about the program’s financial risks.

When Congress was developing the program in late 2009, Senator Kent Conrad, Democrat of North Dakota and chairman of the Budget Committee, described it as “a Ponzi scheme of the first order” because it required an ever-increasing stream of premiums to cover the cost of benefits. Connie Garner, who helped devise the long-term care program as an aide to Mr. Kennedy, said she was “very, very disappointed” by the decision. “The program could have been made to work” if the administration had tried harder, Ms. Garner said.

I haven’t followed this particular aspect of the law closely enough to have an opinion and, consequently, don’t have one. Certainly, catastrophic care of this sort would seem to be a starting point, rather than a luxury component, of a centralized health plan. But I haven’t the foggiest how you’d make it work as a pay-as-you-go standalone plan.

FILED UNDER: Health, Quick Takes, US Politics
James Joyner
About James Joyner
James Joyner is Professor and Department Head of Security Studies at Marine Corps University's Command and Staff College and a nonresident senior fellow at the Scowcroft Center for Strategy and Security at the Atlantic Council. He's a former Army officer and Desert Storm vet. Views expressed here are his own. Follow James on Twitter @DrJJoyner.

Comments

  1. Dude says:

    How does the white house get to choose what is/is not to be implemented.

  2. Just nutha ig'rant cracker says:

    @Dude: Ummm, because he’s the President???

    @James: Sadly, catastrophic care is one of the “Cadillac” components of health care policies. Because of the high costs of long-term catastrophic care, most policies cap out very early. My last policy had a cap of $40,000–about 5 or 6 months. My dad on the other hand has been in a Altzheimer’s care facility for 6 years. His extended coverage policy capped out at 4, and the balance has been about $72k a year. Premiums for the policy ran over $4000 a year for each–my mom and dad.

  3. Stan says:

    @Dude: In the Affordable Care Act the administration had to meet certain criteria involving financing before the long term care plan could be implemented. The administration couldn’t meet the criteria, hence it very sensibly scrapped long term care.

  4. Tlaloc says:

    PPACA- just getting better and better.

  5. Jay says:

    This is a great example of how perverted our process of healthcare legislation is. A plan dedicated to covering chronic illness should never depend on healthy people signing up, because obviously it would never be in their financial interest to do so. We knew this when CLASS was proposed. The entire point of gov-run care is to risk pool so that we don’t have to segregate people by health status. But, if you have something like CLASS, it has to be a straight entitlement. It never had a hope of being budget neutral, and now, for whatever reason, the WH can’t hide that anymore and has decided to focus on other things.

  6. Tlaloc says:

    A plan dedicated to covering chronic illness should never depend on healthy people signing up, because obviously it would never be in their financial interest to do so.

    A plan to help chronic illness (or acute illness for that matter) should never rely on for profit businesses.