Vidhya Alakeson on the CLASS Act

As disability and aging advocacy groups continue to wait for the publication of the UK Government’s social care green paper, advocates on the other side of the Atlantic have been celebrating Obama’s show of support for the inclusion of social care reform as part of healthcare reform. Social care, or long term care as it is called in the US, accounts for 36 percent or $110 billion (£68 billion) of the total costs of Medicaid, the public insurance programme for the poor and disabled. Medicaid is funded jointly by the federal government and by state governments and state leaders have long felt the weight of growing social care costs. But the issue had not reached the national debate until now.

An influential group of senators and members of the House of Representatives recently introduced a bill entitled the Community Living and Social Supports or CLASS ACT. The Act creates a new national insurance programme that is based on employee contributions of $30 (£18.50) a month and will provide cash assistance to people once they reach a certain level of disability, as determined by a state-level adjudicator. If an individual is determined to have two limitations in activities of daily living such as bathing, dressing and eating, he or she will be entitled to receive $50 (£31) a day. Once he or she reaches four limitations, that person will qualify for $100 (£62) a day. Individuals will be automatically enrolled into the scheme and have to opt out to avoid payment. Once eligible for support, the money will be paid monthly into a Life Independence Account and spending will be monitored to ensure that the money is only used for non-medical support services that allow individuals to remain in their own homes.

In the current system, there is no public support available for people who require social care unless they are poor enough and disabled enough to qualify for Medicaid long term care. Medicare, the universal public health insurance program for people over sixty five does not cover social care services. As such, help is only available once someone has deteriorated to a severe level of disability and is then at risk of going into a nursing home and people have to remain impoverished in order to maintain their eligibility for help. The CLASS Act attempts to provide some support for people earlier on in order to encourage people with disabilities to live independently in their own homes.

The CLASS Act has been introduced before but has not gathered sufficient momentum to ever be passed into law. With support from the President and the Secretary of the Department of Health and Human Services, this time it might have a better chance. But there are two big problems standing in the way. The first is linked to its design as a universal program. The CLASS Act subsidies those who can afford to provide for themselves and does not do enough for those on low incomes. Individuals on low incomes earn too much to qualify for Medicaid but have limited private means to bridge the gap between the cost of services and public support. The second and far bigger problem is that it is unaffordable. Given the current government deficit and the enormous price of health care reform alone, there just is not enough money to pay for the good intentions of the CLASS Act.

Vidhya Alakeson is a former Harkness Fellow in Healthcare Policy based in Washington DC.