NAIFA Reports:
On September 23, Sen. Lindsey Graham (R-SC) introduced S. 3829, the Long-Term Care Bailout Prevention Act to repeal the CLASS Act. The CLASS Act was included in the health reform law enacted this past March. It sets up a voluntary federal long-term care/disability insurance program under which workers may choose to pay an actuarially sound monthly premium for a daily cash benefit (also to be calculated to be actuarially sound) if they become unable to perform two or more activities of daily living.
The CLASS Act is set to take effect in 2011. It is a voluntary program, although employers who choose to participate must automatically enroll their workers, subject to a worker opt-out provision. Premiums—which have not yet been set but are expected to be around $65 per month—must be paid for at least five years before a benefit can be paid. Benefit levels are also not yet set, but are anticipated to be around $50 per day, payable via a debit card, without restrictions on how the money could be used.
NAIFA Reports: “Sen. Graham’s unease echoes Rep. Charles Boustany’s (R-LA) concern with the new program. In July, Boustany introduced H.R. 5853, the Fiscal Responsibility and Retirement Security Act. His bill would prevent the government from collecting CLASS premiums until the program’s governing regulations are finalized.
NAIFA Staff Contact: Diane Boyle, Vice President – Federal Government Relations, at (703) 770-8252.