On October 14, the Department of Health and Human Services (HHS) announced that it was suspending implementation of the Community Living Assistance Services and Supports (CLASS) program.
Mandated by the health care reform law, the CLASS program was intended to be a consumer-funded, voluntary long-term care insurance program that would cash benefits for eligible beneficiaries. The program would have been available for active workers who were at least 18 years old; enrollment in the CLASS program would be voluntary, although employers could automatically enroll employees with monthly premiums deducted via payroll (subject to opt-out rights). To implement the CLASS program, the Secretary of HHS was required to develop at least three “actuarially sound” benefit plans that would remain solvent for 75 years, one of which would be designated as the final “CLASS Independent Benefit Plan” by October 1, 2012.
In suspending the CLASS program, HHS cited actuarial and solvency impediments as the reason why they had “not identified a way to make CLASS work at this time.” The full report sent to Congress is available here, along with the Secretary’s cover letter. There is no indication if HHS will restart work on the CLASS program in the future.