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Obamacare: CLASS Act Repeal Vote Approaching in the House

Posted By Alyene Senger On January 31, 2012 @ 4:12 pm In Featured,Obamacare | Comments Disabled

The House of Representatives is expected to vote as early as tomorrow on H.R. 1173, the Fiscal Responsibility and Retirement Security Act of 2011. This bill would repeal the CLASS Act, Obamacare’s new long-term care entitlement. The CLASS Act is just another reminder that the entire health care law is flawed and unworkable.

As noted by Heritage policy analysts, the CLASS Act is doomed to fail. It was created as a budget gimmick to help Obamacare pass. This is due to the illusion that CLASS produces a short-term deficit reduction as the government collects premiums for five years (2012–2016) before it begins paying benefits.

In addition, CLASS has an unsustainable structure. It is a voluntary “insurance” program that must offer coverage to every applicant at a uniform rate. This setup leads to massive adverse selection, where only the sick or disabled will want to participate. As this causes premium costs to rise, fewer and fewer people will want to participate. This leads to what insurers call the “death spiral.” The only remedy would be to burden the taxpayers with either a taxpayer bailout or mandatory participation of all Americans in CLASS.

The CLASS Act is simply bad policy. Even the Secretary of Health and Human Services (HHS) can’t seem to figure out how to get it to work, calling it “totally unsustainable” and “financially unsound.” HHS has had to shelve the program—at least for now.

If you are looking to better understand the CLASS Act debate, here are some Heritage resources to help you get you up to speed:

BLOGS:

1/20/12 Obamacare Is Losing CLASS Fast [1]

11/1/11 CLASS Dismissed: Long-Term Care Program Examined in Hill Hearing [2]

10/14/11 Obamacare’s CLASS Act Collapses; White House Pulls Plug [3]

9/23/11 Morning Bell: The Latest Obamacare Implosion [4]

4/5/11 New Report Shows Sec. Sebelius is Overstepping Her Authority [5]

9/23/10 CLASS Act Repeal Should Be Taken Seriously [6]

WEBMEMOS:

3/16/11 Secretary Sebelius Cannot Fix CLASS [7]

1/19/11 Obamacare and the CLASS Act: Creating a Long-Term Care Entitlement Burden [8]

BACKGROUNDERS:

7/29/10 No CLASS: How Congress Saddled Taxpayers with Another Costly Entitlement [9]

7/22/10 The CLASS Act: Repeal Now, or Face Permanent Taxpayer Bailout Later [10]


Article printed from The Foundry: Conservative Policy News from The Heritage Foundation: http://blog.heritage.org

URL to article: http://blog.heritage.org/2012/01/31/class-act-repeal-vote-approaching-in-the-house/

URLs in this post:

[1] Obamacare Is Losing CLASS Fast: http://blog.heritage.org../../../../../2012/01/20/obamacare-is-losing-class-fast/

[2] CLASS Dismissed: Long-Term Care Program Examined in Hill Hearing: http://blog.heritage.org../../../../../2011/11/01/class-dismissed-long-term-care-program-examined-in-hill-hearing/

[3] Obamacare’s CLASS Act Collapses; White House Pulls Plug: http://blog.heritage.org../../../../../2011/10/14/white-house-ends-obamacares-class-act/

[4] Morning Bell: The Latest Obamacare Implosion: http://blog.heritage.org../../../../../2011/09/23/morning-bell-the-latest-obamacare-implosion/

[5] New Report Shows Sec. Sebelius is Overstepping Her Authority: http://blog.heritage.org../../../../../2011/04/05/new-report-shows-sec-sebelius-is-overstepping-her-authority/

[6] CLASS Act Repeal Should Be Taken Seriously: http://blog.heritage.org../../../../../2010/09/23/class-act-repeal-should-be-taken-seriously/?query=CLASS+Act+Repeal+Should+Be+Taken+Seriously

[7] Secretary Sebelius Cannot Fix CLASS: http://www.heritage.org/research/reports/2011/03/secretary-sebelius-cannot-fix-class-program

[8] Obamacare and the CLASS Act: Creating a Long-Term Care Entitlement Burden: http://www.heritage.org/research/reports/2011/01/obamacare-and-the-class-act-creating-a-long-term-care-entitlement-burden

[9] No CLASS: How Congress Saddled Taxpayers with Another Costly Entitlement: http://www.heritage.org/research/reports/2010/07/no-class-how-congress-saddled-taxpayers-with-another-costly-entitlement

[10] The CLASS Act: Repeal Now, or Face Permanent Taxpayer Bailout Later: http://www.heritage.org/research/reports/2010/07/the-class-act-repeal-now-or-face-permanent-taxpayer-bailout-later

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