The CLASS Act Wasn't a Class Act
Despite all the tricks in budgeting and propaganda to sell the American people on the Affordable Care Act’s Community Living Assistance Services and Supports (CLASS) Act, Washington insiders, economists and politicians on both sides of the isle agree that the CLASS Act was a “Ponzi scheme of the first order”.
Before it was publically acknowledged that this program was completely unsustainable some Democrats and the Congressional Budget Office (CBO) claimed, through some interesting accounting, that the program would save millions. This lead to an embarrassing situation for the White House and the Department of Health and Human Services (HHS) when the CBO, after additional analysis, estimated that within ten years the CLASS Act would start adding tens of billions of dollars to the deficit.
Problems with the CLASS Act generally stem from the likelihood that only seniors who most need long-term care, which is very expensive, would join the program while healthy individuals would not. Thus, the risk pool for the program would be disproportionately filled with sicker and more expensive individuals.
Despite the fact that everyone except the White House has agreed repealing the CLASS Act is the best alternative, it isn’t officially dead just yet. However, it got one step closer this morning when the House of Representatives Ways and Means Committee held a hearing to markup the Fiscal Responsibility and Retirement Security Act of 2011 (HR1173). This bill to repeal the CLASS Act passed the committee favorably, with one Democrat voting with Republicans.
It’s been a long time coming, but no one will be sad to see the CLASS Act go.