he Community Living Assistance Services and Supports program or CLASS Act was established by an amendment to the health reform law. The CLASS Act is a national, voluntary insurance program created to help offset the costs of non-medical services and supports such as home health care and adult day care. If it lives up to expectations it will reduce reliance on Medi-Cal (Medicaid), provide relief to family caregivers, and allow people with disabilities to reside for longer in the community. Benefits will be paid out of a trust fund consisting of the enrollees’ premiums and the interest earned on the trust fund.
When It Begins – The CLASS program is effective on January 1, 2011. The Secretary of Health and Human Services (“HHS Secretary”) is expected to define the CLASS benefit by October 2012 after which enrollment will begin.
Who Can Enroll and What It Costs – Working adults may make voluntary premium contributions through payroll deductions or directly. The monthly premiums will be determined by the HHS Secretary and will be set to maintain 75-year program solvency. Younger participants will pay less than older participants; and actively employed individuals with income below the federal poverty level or who are full-time students will pay nominal premiums, starting at $5 per month. There is no underwriting to determine eligibility or amount of premiums.
Eligibility For Benefits – In order to receive benefits, a participant must have paid monthly premiums for at least five years and have worked during at least three of those five years. (So, with enrollment beginning in 2012, benefits could not begin until 2017 at the earliest.) In addition, the participant must have either functional or equivalent cognitive limitations expected to last more than 90 days, as certified by a licensed health care practitioner. Functional impairment exists if the participant is unable to perform at least two, but not more than six, activities of daily living (e.g., eating, toileting, bathing, dressing, transferring). Eligibility will be determined by as-yet-unspecified organizations.
The Benefits – The benefit is cash, the amount of which is based on the degree of impairment or disability, but averaging no less than $50 per day. The Congressional Budget Office expects benefits to average about $75 per day or about $27,375 per year. And there is no lifetime limit.
The benefit will be posted to a debit account on a daily or weekly basis. The participant can use the benefits to offset the cost of such support as home health care, adult day care, respite care, assistive technology and personal assistance, home modifications, transportation, and homemaker services. The program also includes voluntary counseling services for help in choosing care and care providers and for deciding to accept or decline care. CLASS benefits can be used if the participant moves into an assisted living facility or nursing home.
CLASS program benefits have no effect on SSI or Medi-Cal eligibility, though Medi-Cal will take a part of the benefit.
It Is Not Medical or LTC Insurance – The CLASS program is not designed to replace basic health insurance or long-term care insurance coverage, but to supplement that coverage with a means to pay for non-medical costs in the community.
A version of this article originally appeared in the Bulletin of the Alameda County Bar Association.
