The Basics

As I mentioned in my last blog entry, the health care reform bill signed by President Obama includes something called Community Living Assistance Services and Supports (CLASS).  CLASS is a voluntary, self-funded insurance program for long-term care services.  People who are working will be able to pay into a fund that will provide ongoing cash benefits should they lose their ability to perform multiple activities of daily living.  A person who receives these benefits gets to decide which nonmedical services and supports he or she needs to maintain independence at home or in another residential setting.

Why do we need CLASS?

We’re not getting any younger.  Long-term supports and services are expensive and most of us don’t have insurance to cover them.  Medicare and most private insurance only pay for a short period of long-term care.  Those who need long-term care often must spend all of their assets until they are eligible for Medicaid (that is, until they are officially poor). 

Today, about five million Americans under age 65 who live in the community have long-term care needs.  More than 70,000 workers with severe disabilities need daily assistance to maintain their jobs.  About 65 percent of people over 65 will need some amount of long-term care services in their homes.  There are now one-and-a-half million Americans in nursing homes, and about nine million seniors who need assistance with activities of daily living.  These numbers are all on the rise.

How does CLASS work?

Anyone who is working can choose to enroll or opt out.  Those who participate pay a monthly premium.  You must pay premiums for five years and work for three years in order to qualify for benefits.  If you come to need help with activities of daily living you will be assessed and, if eligible, begin receiving benefits.  The amount of the benefits depends on your level of need.  CLASS anticipates that the average case benefit will be about $75 per day.  Counseling, coordination and advocacy services to assure receipt of high-quality support services will also be available.

Does CLASS respect disability rights?

Absolutely. CLASS is designed to support choice and independence. Participation is voluntary. Benefits may be used as the person sees fit to support and maintain community living (home modifications, assistive technology, accessible transportation, homemaker services, respite care, personal assistance services, home care aides, nursing support, etc). They may even be used to help a person with disabilities stay on the job. For those with greater needs, benefits can also be used to offset the costs of assisted living and nursing home care.

How can the government afford this program?

All CLASS benefits and administrative costs come from premiums, not taxpayer money. To assure this, the law requires that premiums be set at a level that actuaries certify as self-sustaining. In addition, CLASS will save public money by reducing Medicaid costs. Allowing people to hire their own help and make their own choices lowers the need for expensive, publicly-funded nursing home beds.

So? (And what about that Keep Rockin' reference in the title?)

As a member of the Baby Boom generation, Biden's language does not shock me.  Nor (as is likely true of many Boomers) have I fully embraced fact that old age approacheth.  I've never bought long-term care insurance because it's expensive, it has terms and limitations that are hard to evaluate, and -- to be honest -- I simply don't like thinking about it. 

But now, like Joe Biden, I am excited.  With a touch of this CLASS, my fellow Boomers and I could have the chance to keep on "rockin' in the free world."

The Status Quo

People with disabilities who are ready and able to work have an unemployment rate that is consistently twice as high as the rate for the non-disabled.  It is not only harder to find a job, but it’s harder to keep one, leaving employer-provided health insurance always at risk.  And when changing jobs, denial of coverage due to “pre-existing condition” exclusions becomes a major obstacle to good health and job readiness for anyone who depends upon health services. 

For parents of children with disabilities, maintaining health insurance without risking new pre-existing condition limitations causes parents to stay in jobs rather than follow new opportunities.  And yet, even in those jobs, parents find themselves paying more and more of the cost of insurance, even to the point where they are choosing between health care coverage and daily necessities of life.

For those on Medicare, inadequate reimbursement rates have made it almost impossible for some people to find a provider.  The infamous “donut hole” continues to put the cost of prescriptions out of reach for many.  And because of rising health costs, those of low-to-moderate income are frozen out of the market, causing them to get unavoidable health services at the emergency room -- at high costs that often lead to unpaid bills and bankruptcies.

What the House did yesterday finally starts a reasonable approach to addressing these critical needs.  Here’s what it does:

• Expands coverage to 32 million uninsured Americans.
• Coverage for uninsured and self-employed will be available for purchase insurance through state-based exchanges with subsidies for those with income up to 400 percent of the federal poverty level ($22,050 for a family of four).
• Separate exchanges for small businesses to purchase coverage will be available beginning in 2014.

Medicare:

• Closes the Medicare prescription drug "donut hole" by 2020. Those in the donut hole by 2010 will receive a $250 rebate.
• Beginning in 2011, those in the donut hole will receive a 50 percent discount on brand name drugs.

Medicaid:

• Expands Medicaid to include 133 percent of federal poverty level
• Requires states to expand Medicaid to include childless adults starting in 2014.
• The Federal Government will pay 100 percent of costs for covering newly eligible individuals through 2016.
• Undocumented immigrants are not eligible for Medicaid.

Insurance Reforms:

• Six months after enactment, insurance companies can no longer deny children coverage based on preexisting conditions.
• Starting in 2014, insurance companies cannot deny coverage to anyone with a preexisting condition.
• Insurance companies must allow children to stay on their parent's insurance plans through age 26.

Abortion:

• Segregates private insurance premium funds from taxpayer funds. Individuals will have to pay for abortion coverage by making two separate payments.  Private funds will have to be kept in a separate account from federal and taxpayer funds.
• No health care plan will be required to offer abortion coverage. States may pass legislation choosing to opt out of offering abortion coverage through the exchange.
• An executive order states that no federal funds can be used to pay for abortions except in the case of rape, incest or health of the mother.

Individual Mandate:

• In 2014, everyone must purchase health insurance or face a $695 annual fine. There are some exceptions for low-income people.

Employer Mandate:

• Employers with more than 50 employees must provide health insurance or pay a fine of $2,000 per worker each year if any worker receives federal subsidies to purchase health insurance.
• Undocumented immigrants will not be allowed to buy health insurance in the exchanges -- even if they pay completely with their own money.

Costs:

• According to federal estimates, the bill will reduce the deficit by $143 billion over the first 10 years and by $1.2 billion dollars in the second ten years.

• Starting in 2012, the Medicare Payroll Tax will be expanded to include unearned income. That will be a 3.8 percent tax on investment income for families making more than $250,000 per year ($200,000 for individuals).
• Excise Tax -- Beginning in 2018, insurance companies will pay a 40 percent excise tax on so-called "Cadillac" high-end insurance plans worth over $27,500 for families ($10,200 for individuals). Dental and vision plans are exempt and will not be counted in the total cost of a family's plan.
• Tanning Tax -- 10 percent excise tax on indoor tanning services.  (No kidding!)
  

The bill also includes the Community Living Assistance Services and Supports Act "CLASS ACT" that the national disability community has pushed for years.  It establishes a national voluntary insurance program for purchasing community living assistance services and supports.  I will write more about it in a separate post.

This legislation is filled with compromises which reflect our nation's diverse interests and concerns.  For those who feel that their financial and political interests are put at risk, the battle is far from over.  We will see legal and media attacks for months and years to come.  But for now, the disability community has much to celebrate.