0 Replies Latest reply on Jun 12, 2010 12:42 PM by jkom51

    LTC Option in Healthcare Reform bill

    jkom51

      Two articles which explain some of the pros and cons. This will only be available to people working at least 5 years after the program begins collecting premiums (employer participation is optional, as pointed out in the articles). I agree with the first article that the estimated premium is only worth paying for those who could not qualify for at least a Standard rating, before age 55, on a much more comprehensive private LTC policy. We have such policies, and don't pay currently much more for better coverage than the estimated CLASS premium will be.

      HTH some folks who were not aware of this:

      Health Reform's Long-Term Care Option

      June 11, 2010  SmartMoney: Elder Care by Lisa Scherzer

      http://www.smartmoney.com/personal-finance/elder-care/health-reforms-long-term-care-option/?page=all

      Tucked into the health reform legislation that passed in March is a national voluntary insurance program for purchasing long-term-care services.

       Called the Community Living Assistance Services and Supports program, or CLASS, the program’s benefits will be financed by voluntary contributions paid by working adults (age 18 or older) through payroll deductions.

       The program could go to supplement the private long-term-care insurance that consumers purchase to cover the costs of long-term-care services, most of which are not covered by traditional health insurance or Medicare. LTC insurance policies pay for several types of care, including nursing home care, assisted living care, and home health care services.

       “The idea behind it is: How can we keep people at home for as long as possible, and reduce the number of people going into an institutional setting?” says Janet Forlini, policy director for long-term services and supports at the National Council on Aging.

       Over 10 million Americans need long-term care services and supports to help them with daily activities – a number that’s expected to grow with an aging population, according to Kaiser Family Foundation, a health policy nonprofit.

       Given the new program, how should workers plan for their long-term care? One thing they shouldn’t do is rely solely on CLASS and assume it will take care of all their needs.

      ****************

      Article: With Health Reform, Long-Term-Care Option Becomes Law 

      CLASS Act enacted with health care reform

      3/24/2010  By Stephen Miller 

      http://www.shrm.org/Publications/HRNews/Pages/LongTermOption.aspx

      Under the CLASS Act program, all premium costs can be charged to employees.

       Employers who chose to participate in the CLASS program wil be required to permit  employees to make contributions by means of a payroll deduction, once the CLASS Independence Benefit Plan is designated by U. S. Department of Health and Human Services (HHS), which is to be no later than Oct. 1, 2012.

       Employers either would create automatic enrollment procedures that allow workers to opt out, or allow workers to choose to enroll and pay premiums. Participants must pay monthly premiums for at least five years before they could receive benefits. Seniors (over age 65 years old) who have paid premiums for at least 20 years and are not actively employed are exempt from paying any premium increase.

       Premium payments will be placed in a "Life Independence Account" on behalf of each eligible beneficiary and managed by the U.S. Department of Health and Human Services as a new insurance program.

       As the CLASS program is developed, participating employers will need to coordinate with their payroll services providers to facilitate these deductions and contributions.

       The Congressional Budget Office estimates that the monthly insurance premium will average about $123 in 2011. Premiums vary with age and will not increase once employees signed up, but they would increase for those signing up later.

       After five years of paying into the program, enrollees who continue to pay monthly premiums would become eligible for assistance if they experience limitations in two or more so-called activities of daily living, including eating, bathing, dressing and taking medications. This assistance would take the form of a modest daily cash benefit, estimated at $50 per day for impaired enrollees living in the community, for services such as respite care, home care aides and accessible transportation, and up to $75 a day for enrollees who become institutionalized. These amounts would increase with inflation.