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Saturday, October 15, 2011

Obama pulls plug on part of health overhaul law

Great news, America! - Reggie

WASHINGTON (AP) - The Obama administration Friday pulled the plug on a major program in the president's signature health overhaul law—a long-term care insurance plan dogged from the beginning by doubts over its financial solvency.

Targeted by congressional Republicans for repeal, the program became the first casualty in the political and policy wars over the health care law. It had been expected to launch in 2013.

"This is a victory for the American taxpayer and future generations," said Sen. John Thune, R-S.D., spearheading opposition in the Senate. "The administration is finally admitting (the long-term care plan) is unsustainable and cannot be implemented."

Proponents, including many groups that fought to pass the health care law, have vowed a vigorous effort to rescue the program, insisting that Congress gave the administration broad authority to make changes. Long-term care includes not only nursing homes, but such services as home health aides for disabled people.

Known as CLASS, the Community Living Assistance Services and Supports program was a longstanding priority of the late Massachusetts Democratic Sen. Edward M. Kennedy.

Although sponsored by the government, it was supposed to function as a self-sustaining voluntary insurance plan, open to working adults regardless of age or health. Workers would pay an affordable monthly premium during their careers, and could collect a modest daily cash benefit of at least $50 if they became disabled later in life. The money could go for services at home, or to help with nursing home bills.

But a central design flaw dogged CLASS. Unless large numbers of healthy people willingly sign up during their working years, soaring premiums driven by the needs of disabled beneficiaries would destabilize it, eventually requiring a taxpayer bailout.

After months insisting that could be fixed, Health and Human Services Secretary Kathleen Sebelius, finally admitted Friday she doesn't see how.

"Despite our best analytical efforts, I do not see a viable path forward for CLASS implementation at this time," Sebelius said in a letter to congressional leaders.

The law required the administration to certify that CLASS would remain financially solvent for 75 years before it could be put into place.

But officials said they discovered they could not make CLASS both affordable and financially solvent while keeping it a voluntary program open to virtually all workers, as the law also required.

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