New Federal LTC Program
Creates new, voluntary national insurance program (Community Living Assistance Services and Supports or “CLASS” program) financed through payroll deductions to provide a cash benefit to individuals who require community living assistance services and support.
(PPACA § 8002)
- Enrollment. Provides for auto-enrollment of all working individuals over age 18, but permits them to opt out of the program. Allows employers to provide payroll deduction for premium costs. Prohibits underwriting to prevent individuals from enrolling in the program to determine their premiums.
- Premiums. Requires individuals to contribute monthly premiums (set by HHS based on an actuarial analysis of the 75-year costs of the program). Premiums to remain the same for as long as an individual is an active enrollee in the program, although premiums can be increased if HHS determines that such increase is necessary to ensure program solvency. Individuals age 65 or older, who have paid premiums for at least 20 years and are not actively employed are exempt from such increases. Permits higher age-adjusted premiums for individuals who reenroll after more than a 3-month lapse in coverage. Charges only a nominal premium ($5/month) for individuals with incomes below 100% FPL and full-time students under age 22.
- Eligibility for Benefits. Vesting period of 5 years. Benefits are triggered when an individual experiences a functional limitation that is expected to last more than 90 days. Provides tiered benefits to individuals unable to perform a minimum number (which may be 2 or 3) “activities of daily living.”
- Benefits. Eligible beneficiaries would receive not less than $50 per day (increased annually by the increase in the CPI), scaled to the level of functional ability. The benefit would not be subject to any lifetime or aggregate limit. Payment of the cash benefit would go into a beneficiary’s Life Independence Account for the purchase of nonmedical services and supports (personal assistance, transportation, assistive technologies, etc.) needed to maintain independence at home or in another residential setting of their choice in the community.
- Beneficiaries enrolled in Medicaid and receiving services in an institution would retain 5% of the daily or weekly cash benefit and the remainder would be applied toward the institution’s cost of providing care. Medicaid would provide secondary coverage for such care.
- Beneficiaries enrolled in Medicaid and receiving home and community-based services would retain 50% of the daily or weekly cash benefit and the remainder would be applied toward the cost to the state of providing such assistance. Medicaid would provide secondary coverage for the remainder of any costs incurred.
- Eligibility for Other Benefits. Benefits paid under the CLASS program are to be disregarded for purposes of determining that individual’s eligibility for any other Federal, state or local assistance program (i.e., Social Security, Medicare, Medicaid, low-income housing assistance, etc.)