The Community Living Assistance Supports and Services (CLASS) Act The Class Act created a government administered voluntary long-term care insurance program as part of the Health Care Reform. The law becomes effective on January 1, 2011, however it is not expected to be operational at this point. The Department of Health and Human Services, who will oversee the program, has until October 1, 2012 to design the benefit plan.
EMPLOYERS
- Employers will have the choice to opt-in to the program.
- Employees will then become automatically enrolled and a premium paid through payroll deduction unless they opt-out.
- If an employer opts out employees will have a choice to participate directly.
ELIGIBILITY - You must be actively employed to be eligible to participate.
- Participants are eligible to receive benefits after:
- Having been enrolled in the program and paid premiums for 5 years.
- Having earned income equivalent to Social Security requirement for 3 of the 5 years.
- Having paid premiums for 24 consecutive months if a lapse had occurred.
- You do not have to medically qualify for the program.
COST - Monthly premiums are based on the participant’s age at enrollment.
- Premiums will be determined based on maintaining a 75 year program solvency.
- Plan is intended to be funded solely by premiums paid by participants.
- Monthly premiums costs are projected to be from $120 per month to $240 per month.
- Premiums are managed by the Department of Health and Human Services.
BENEFIT - Possible cash benefit of no less than $50 per day and possibly $75 or $100 per day.
- Benefits could be paid daily or weekly.
- No limit on the amount of benefit received during lifetime.
- Benefits are paid once a participant is unable to perform 2 or 3 Activities of Daily Living and/or has impaired cognitive function.
POINTS TO CONSIDER - The American Academy of Actuaries projected that the fund for the CLASS Act would be insolvent within 11 years.
- The projected maximum daily benefits are much lower than what is available through private insurers and is not adequate to fully fund the monthly cost of facility care.
- Private insurance daily limits can be as high as $400 per day.
- The five year waiting period precludes a participant from receiving benefits until he or she has paid premiums for five years.
- Participants in private insurance programs qualify for a benefit as soon as their application is approved.
- Premiums are likely to increase to maintain the solvency of the program.
If you have any questions or would like to further discuss the CLASS Act please contact Laura McKiernan or John Mancuso at 617-587-2300. Bostonian Group is here for your questions & concerns! | 
