The Obama administration is giving up on a controversial piece of the healthcare reform law. CLASS – Community Living Assistance Services and Supports, as an integral part of Obamacare, was supposed to provide about 40% of the savings as a result of health-care reform. Congressional Budget Office’s (CBO) estimates projected $210 billion in total deficit reduction from the healthcare law, $86 billion of which would have come from CLASS.
CLASS was canceled by Health and Human Services (HHS) Secretary Kathleen Sebelius after a 19-month effort to find a way to make it financially viable and self-sustainable. “We won’t be working further to implement the CLASS Act … We don’t see a path forward to be able to do that,” said Assistant Secretary for Aging Kathy Greenlee. CLASS is the largest piece of healthcare reform to be terminated, and is the first to collapse entirely on its own. HHS officials acknowledged that CLASS failed because it was too flawed to salvage. In a Friday afternoon letter to Congress, Sebelius wrote, “Despite our best analytical efforts, I do not see a viable path forward for CLASS implementation at this time.” Congress specified that the HHS secretary had to determine that the program would be sustainable for 75 years. HHS said a detailed analysis of the CLASS program showed that it simply couldn’t be made to work. Premiums would have been too high to attract enough interest to keep the program afloat. The White House said the decision to cancel CLASS does not reflect problems with other parts of healthcare reform.
Republicans said the CLASS program won’t be the last piece of healthcare reform to fail. “This announcement is a canary in a coal mine,” Senator Orrin Hatch (R-UT) said in a statement. “Today’s abandonment of the program is just the latest evidence demonstrating ObamaCare’s devastating effects and ill-conceived policies. What will be next?” Representative Paul Ryan (R-IN), chairman of the House Budget Committee, said the administration finally “surrendered to reality.” “We have always known that this program was a naked scam – cooking the books trying to cover up the unsustainable cost of Washington Democrats’ government takeover of health care,” said Michael Steel, a spokesman for House Speaker John Boehner (R-OH).
BTW, CLASS was a pet project of the late Senator Ted Kennedy.