[House Report 112-342]
[From the U.S. Government Publishing Office]
112th Congress Rept. 112-342
HOUSE OF REPRESENTATIVES
1st Session Part 1
======================================================================
FISCAL RESPONSIBILITY AND RETIREMENT SECURITY ACT OF 2011
_______
December 23, 2011.--Ordered to be printed
_______
Mr. Upton, from the Committee on Energy and Commerce, submitted the
following
R E P O R T
together with
DISSENTING VIEWS
[To accompany H.R. 1173]
[Including cost estimate of the Congressional Budget Office]
The Committee on Energy and Commerce, to whom was referred
the bill (H.R. 1173) to repeal the CLASS program, having
considered the same, report favorably thereon with an amendment
and recommend that the bill as amended do pass.
CONTENTS
Page
Purpose and Summary.............................................. 2
Background and Need for Legislation.............................. 2
Hearings......................................................... 3
Committee Consideration.......................................... 4
Committee Votes.................................................. 4
Committee Oversight Findings..................................... 10
Statement of General Performance Goals and Objectives............ 10
New Budget Authority, Entitlement Authority, and Tax Expenditures 10
Earmarks......................................................... 10
Committee Cost Estimate.......................................... 10
Congressional Budget Office Estimate............................. 10
Federal Mandates Statement....................................... 12
Advisory Committee Statement..................................... 12
Applicability to Legislative Branch.............................. 13
Section-by-Section Analysis of the Legislation................... 13
Changes in Existing Law Made by the Bill, as Reported............ 13
Dissenting Views................................................. 54
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Fiscal Responsibility and Retirement
Security Act of 2011''.
SEC. 2. REPEAL OF CLASS PROGRAM.
(a) Repeal.--Title XXXII of the Public Health Service Act (42 U.S.C.
300ll et seq.; relating to the CLASS program) is repealed.
(b) Conforming Changes.--
(1)(A) Title VIII of the Patient Protection and Affordable
Care Act (Public Law 111-148; 124 Stat. 119, 846-847) is
repealed.
(B) The table of contents contained in section 1(b) of such
Act is amended by striking the items relating to title VIII.
(2) Section 1902(a) of the Social Security Act (42 U.S.C.
1396a(a)) is amended--
(A) by striking paragraphs (81) and (82);
(B) in paragraph (80), by inserting ``and'' at the
end; and
(C) by redesignating paragraph (83) as paragraph
(81).
(3) Section 6021(d) of the Deficit Reduction Act of 2005 (42
U.S.C. 1396p note) is amended--
(A) in paragraph (2)(A)(iv)--
(i) by inserting ``not'' before ``include'';
and
(ii) by striking ``and information'' and
inserting ``or information''; and
(B) in paragraph (3)--
(i) in the heading, by striking
``Appropriation'' and inserting ``Funding'';
(ii) by striking ``2015'' and inserting
``2012''; and
(iii) by adding at the end the following new
sentence: ``There is authorized to be
appropriated to carry out this subsection
$3,000,000 for each of fiscal years 2013
through 2015.''.
Purpose and Summary
H.R. 1173, the ``Fiscal Responsibility and Retirement
Security Act of 2011,'' a bill to repeal provisions of the
Public Health Service Act enacted under the Patient Protection
and Affordable Care Act (PPACA) (entitled the Community Living
Assistance Services and Supports Act or the CLASS Act), was
introduced on March 17, 2011, by Rep. Charles W. Boustany, Jr.
(R-LA), and was referred to the Committees on Energy and
Commerce and Ways and Means.
The goal of H.R. 1173 is to terminate any further Federal
activity or spending by the Executive Branch on the CLASS
program, which the U.S. Department of Health and Human Services
(HHS) has determined to be unsustainable.
Background and Need for Legislation
The intent of the CLASS Act was to develop a Federally run
voluntary insurance program for purchasing community living
assistance services and supports in order to provide
individuals with functional limitations with tools that will
allow them to maintain their personal and financial
independence.
However, both before and after passage of PPACA, opponents
of the program questioned its long-term sustainability and
raised concerns about the program's affordability for consumers
and potential impact on the nation's deficit if premiums were
never actually collected.
Those longstanding concerns were reiterated on Friday,
October 14, 2011, when HHS Secretary Kathleen Sebelius
announced that HHS had suspended work on the CLASS program,
saying ``despite our best analytical efforts, I do not see a
viable path forward at this time.'' On the same day, HHS issued
a comprehensive analysis of its work on the CLASS program
entitled ``Report on the Actuarial, Marketing, and Legal
Analyses of the CLASS Program.''
In that report, Administration on Aging Administrator Kathy
Greenlee raised concerns with potential adverse selection,
noting, ``If healthy purchasers are not attracted to the CLASS
benefit package, then premiums will increase, which will make
it even more unattractive to purchasers who could also obtain
policies in the private market. This imbalance in the
beneficiary pool would cause the program to quickly collapse.''
The affordability of the program's premiums was also a
concern. The HHS analysis projected premiums even higher than
had been previously estimated by outside actuaries, noting the
basic CLASS benefit plan could cost, ``$235 and $391 a month,
and may cost as much as $3,000 per month.''
Hearings
The Subcommittee on Health held its first hearing on the
``Implementation and Sustainability of the New, Government-
Administered CLASS program,'' on March 17, 2011. The following
witnesses testified at the hearing:
The Hon. Kathy Greenlee, Assistant
Secretary, Administration on Aging;
Mr. Allen J. Schmitz, FSA, MAAA, Principal,
Consulting Actuary, Milliman, American Academy of
Actuaries;
Dr. Joseph Antos, Ph.D., Wilson H. Taylor
Scholar in Health Care and Retirement Policy, The
American Enterprise Institute;
The Honorable Mark J. Warshawsky, Current
Member of the Social Security Advisory Board, Director
of Retirement Research, Towers Watson;
Anthony (Tony) J. Young, Senior Public
Policy Strategist, NISH, The AbilityOne Program; and,
William Lawrence Minnix, Jr., LeadingAge,
CEO, Advance CLASS, Inc, Chair.
The Subcommittee on Health held another hearing on HHS'
decision to halt implementation of the CLASS program, on
October 26, 2011. The following witnesses testified at the
hearing:
The Honorable Denny Rehberg, U.S. House of
Representatives;
The Honorable Charles W. Boustany, Jr.,
M.D., U.S. House of Representatives;
The Honorable Theodore E. Deutch, U.S. House
of Representatives;
The Honorable Patrick J. Kennedy, Former
Congressman, U.S. House of Representatives;
The Honorable Kathy Greenlee, Assistant
Secretary for Aging, Administration on Aging (AOA),
U.S. Department of Health and Human Services; and,
The Honorable Sherry Glied, Ph.D., Assistant
Secretary for Planning and Evaluation (ASPE), U.S.
Department of Health and Human Services
The Secretary of HHS also testified before the Health
Subcommittee at a March 3, 2011 hearing regarding the
President's FY 2012 Budget and implementation of PPACA, during
which the CLASS Act was discussed.
Committee Consideration
H.R. 1173 was introduced by Mr. Charles W. Boustany, Jr. on
March 17, 2011, and was referred to the Committees on Energy
and Commerce and Ways and Means.
On November 15, 2011, the Subcommittee on Health met in
open markup session to consider H.R. 1173 and favorably
reported the bill to the full Committee by voice vote.
On November 29 and 30, 2011, the Energy and Commerce
Committee met in open markup session to consider H.R. 1173. The
Committee ordered H.R. 1217 favorably reported by a vote of 33
to 17.
Committee Votes
Clause 3(b) of rule XIII of the Rules of the House of
Representatives requires the Committee to list the record votes
on the motion to report legislation and amendments thereto.
Committee Oversight Findings
Pursuant to clause 3(c)(1) of rule XIII of the Rules of the
House of Representatives, the oversight findings and
recommendations of the Committee are reflected in the
descriptive portions of this report, including the finding that
reining in mandatory spending is necessary to avoid a debt
crisis.
Statement of General Performance Goals and Objectives
In accordance with clause 3(c)(4) of rule XIII of the Rules
of the House of Representatives, the performance goals and
objectives of the Committee are reflected in the descriptive
portions of this report, including the goal of avoiding a debt
crisis by reining in mandatory spending.
New Budget Authority, Entitlement Authority, and
Tax Expenditures
In compliance with clause 3(c)(2) of rule XIII of the Rules
of the House of Representatives, the Committee finds that H.R.
1173 would result in no new or increased budget authority,
entitlement authority, or tax expenditures or revenues.
Earmark
In compliance with clause 9(e), 9(f), and 9(g) of rule XXI,
the Committee finds that H.R. 1173 contains no earmarks,
limited tax benefits, or limited tariff benefits.
Committee Cost Estimate
The Committee adopts as its own the cost estimate prepared
by the Director of the Congressional Budget Office pursuant to
section 402 of the Congressional Budget Act of 1974.
Congressional Budget Office Estimate
Pursuant to clause 3(c)(3) of rule XIII of the Rules of the
House of Representatives, the following is the cost estimate
provided by the Congressional Budget Office pursuant to section
402 of the Congressional Budget Act of 1974:
U.S. Congress,
Congressional Budget Office,
Washington, DC, December 2, 2011.
Hon. Fred Upton,
Chairman, Committee on Energy and Commerce,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 1173, the Fiscal
Responsibility and Retirement Security Act of 2011.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Julia
Mitchell.
Sincerely,
Douglas W. Elmendorf.
Enclosure.
H.R. 1173--Fiscal Responsibility and Retirement Security Act of 2011
Summary: H.R. 1173 would repeal title VIII of the Patient
Protection and Affordable Care Act (PPACA). That title of the
PPACA established the Community Living Assistance Services and
Supports (CLASS) Program--a national, voluntary long-term care
insurance program for purchasing community living assistance
services and supports. Title VIII also authorized and
appropriated funding through 2015 for the National
Clearinghouse for Long-Term Care Information (clearinghouse).
H.R. 1173 would replace those appropriated funds for the
clearinghouse for 2013 through 2015 with funding subject to
future appropriation actions.
CBO estimates that enacting H.R. 1173 would reduce direct
spending by $9 million over the 2012-2016 and 2012-2021
periods. H.R. 1173 also would increase spending subject to
future appropriation by $9 million over the same periods. Pay-
as-you-go procedures apply because enacting the legislation
would affect direct spending. Enacting H.R. 1173 would have no
impact on federal revenues.
The bill contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act (UMRA).
Estimated cost to the Federal Government: The estimated
budgetary impact of H.R. 1173 is shown in the following table.
The costs of this legislation fall within budget function 550
(health).
--------------------------------------------------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
-------------------------------------------------------------------------------------------
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012-2016 2012-2021
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CHANGES IN DIRECT SPENDING
Estimated Budget Authority.................................. 0 -3 -3 -3 0 0 0 0 0 0 -9 -9
Estimated Outlays........................................... 0 -3 -3 -3 0 0 0 0 0 0 -9 -9
CHANGES IN SPENDING SUBJECT TO APPROPRIATION
Estimated Authorization Level............................... 0 3 3 3 0 0 0 0 0 0 9 9
Estimated Outlays........................................... 0 3 3 3 0 0 0 0 0 0 9 9
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Basis of estimate: In its March 2011 baseline projections,
CBO anticipated that the CLASS program would begin collecting
premiums in fiscal year 2012 and that net receipts of the
program over the 2012-2021 period would amount to $81 billion,
not including estimated Medicaid savings of $2 billion. On
October 14, 2011, the Secretary of the Department of Health and
Human Services announced that she did not ``see a viable path
forward for CLASS implementation at this time.''\1\ CBO
considers that announcement to be definitive new information
and as a result, in its next baseline projections (which will
be issued in January), CBO will assume that CLASS will not be
implemented unless there are changes in law or other actions by
the Administration that would supersede the Secretary's
announcement. Further, legislation to repeal the provisions of
law establishing the CLASS program are now estimated as having
no budgetary effect relative to current law.
---------------------------------------------------------------------------
\1\Letter from Kathleen Sebelius, Secretary of the Department of
Health and Human Services, to John A. Boehner, Speaker, House of
Representatives, October 14, 2011.
---------------------------------------------------------------------------
However, the Secretary's announcement does not affect use
of the funds authorized and appropriated for the clearinghouse.
Therefore, the replacement of these appropriated funds for the
clearinghouse for 2013 through 2015 with funding subject to
future appropriation actions would have a budgetary effect of
reducing direct spending by $9 million and subsequently
increasing spending subject to appropriation by $9 million over
the 2012-2021 period.
Pay-as-you-go considerations: The Statutory Pay-As-You-Go
Act of 2010 establishes budget-reporting and enforcement
procedures for legislation affecting direct spending or
revenues. The net changes in outlays that are subject to those
pay-as-you-go procedures are shown in the following table.
Enacting H.R. 1173 would have no impact on federal revenues.
CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 1173, AS ORDERED REPORTED BY THE HOUSE COMMITTEE ON ENERGY AND COMMERCE ON NOVEMBER 30, 2011
--------------------------------------------------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars----
-------------------------------------------------------------------------------------------
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012-2016 2012-2021
--------------------------------------------------------------------------------------------------------------------------------------------------------
NET DECREASE (-) IN THE DEFICIT
Statutory Pay-As-You-Go Impact.............................. 0 -3 -3 -3 0 0 0 0 0 0 -9 -9
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Intergovernmental and private-sector impact: H.R. 1173
contains no intergovernmental or private-sector mandates as
defined in UMRA and would not affect the budgets of state,
local, or tribal governments.
Previous CBO estimate: On October 31, 2011, CBO transmitted
a letter to Senator John Thune providing a cost estimate for S.
720, the Repeal the CLASS Entitlement Act, as introduced in the
Senate on April 4, 2011. H.R. 1173 is similar to S. 720. Both
bills would have no budgetary effect over the 2012-2021 period
for provisions repealing the CLASS program. Both bills,
however, would reduce direct spending by $9 million over the
2012-2021 period as a result of rescinding appropriated funding
for the National Clearinghouse for Long-Term Care Information.
Due to an error on CBO's part, the savings of $9 million over
the 2012-2021 period attributed to rescinding appropriated
funding for the clearinghouse were not included in the October
31 letter to Senator Thune. H.R. 1173 would replace that
appropriated funding with an authorization for future
appropriations of similar amounts for the clearinghouse, but S.
720 would not.
Estimate prepared by: Federal Costs: Julia Mitchell; Impact
on State, Local, and Tribal Governments: Lisa Ramirez-Branum;
Impact on the Private Sector: Michael Levine.
Estimate approved by: Peter H. Fontaine, Assistant Director
for Budget Analysis.
Federal Mandates Statement
The Committee adopts as its own the estimate of Federal
mandates prepared by the Director of the Congressional Budget
Office pursuant to section 423 of the Unfunded Mandates Reform
Act.
Advisory Committee Statement
No advisory committees within the meaning of section 5(b)
of the Federal Advisory Committee Act were created by this
legislation.
Applicability to Legislative Branch
The Committee finds that the legislation does not relate to
the terms and conditions of employment or access to public
services or accommodations within the meaning of section
102(b)(3) of the Congressional Accountability Act.
Section-by-Section Analysis of the Legislation
Section 1. Short title
The bill is entitled the ``Fiscal Responsibility and
Retirement Security Act of 2011.''
Section II. Repeal of the CLASS program
Section II repeals Title XXXII of the Public Health Service
Act and Title VIII of the Patient Protection and Affordable
Care Act (P.L. 111-148)--provisions related to the CLASS
program and amends the Deficit Reduction Act of 2005 (P.L. 109-
171) to repeal provisions providing appropriations for the
National Clearinghouse for Long-Term Care Information through
FY2015.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, existing law in which no change is
proposed is shown in roman):
TITLE XXXII OF THE PUBLIC HEALTH SERVICE ACT
[TITLE XXXII--COMMUNITY LIVING ASSISTANCE SERVICES AND SUPPORTS
[SEC. 3201. PURPOSE.
[The purpose of this title is to establish a national
voluntary insurance program for purchasing community living
assistance services and supports in order to--
[(1) provide individuals with functional limitations
with tools that will allow them to maintain their
personal and financial independence and live in the
community through a new financing strategy for
community living assistance services and supports;
[(2) establish an infrastructure that will help
address the Nation's community living assistance
services and supports needs;
[(3) alleviate burdens on family caregivers; and
[(4) address institutional bias by providing a
financing mechanism that supports personal choice and
independence to live in the community.
[SEC. 3202. DEFINITIONS.
[In this title:
[(1) Active enrollee.--The term ``active enrollee''
means an individual who is enrolled in the CLASS
program in accordance with section 3204 and who has
paid any premiums due to maintain such enrollment.
[(2) Actively employed.--The term ``actively
employed'' means an individual who--
[(A) is reporting for work at the
individual's usual place of employment or at
another location to which the individual is
required to travel because of the individual's
employment (or in the case of an individual who
is a member of the uniformed services, is on
active duty and is physically able to perform
the duties of the individual's position); and
[(B) is able to perform all the usual and
customary duties of the individual's employment
on the individual's regular work schedule.
[(3) Activities of daily living.--The term
``activities of daily living'' means each of the
following activities specified in section
7702B(c)(2)(B) of the Internal Revenue Code of 1986:
[(A) Eating.
[(B) Toileting.
[(C) Transferring.
[(D) Bathing.
[(E) Dressing.
[(F) Continence.
[(4) CLASS program.--The term ``CLASS program'' means
the program established under this title.
[(5) Eligibility assessment system.--The term
``Eligibility Assessment System'' means the entity
established by the Secretary under section 3205(a)(2)
to make functional eligibility determinations for the
CLASS program.
[(6) Eligible beneficiary.--
[(A) In general.--The term ``eligible
beneficiary'' means any individual who is an
active enrollee in the CLASS program and, as of
the date described in subparagraph (B)--
[(i) has paid premiums for enrollment
in such program for at least 60 months;
[(ii) has earned, with respect to at
least 3 calendar years that occur
during the first 60 months for which
the individual has paid premiums for
enrollment in the program, at least an
amount equal to the amount of wages and
self-employment income which an
individual must have in order to be
credited with a quarter of coverage
under section 213(d) of the Social
Security Act for the year; and
[(iii) has paid premiums for
enrollment in such program for at least
24 consecutive months, if a lapse in
premium payments of more than 3 months
has occurred during the period that
begins on the date of the individual's
enrollment and ends on the date of such
determination.
[(B) Date described.--For purposes of
subparagraph (A), the date described in this
subparagraph is the date on which the
individual is determined to have a functional
limitation described in section 3203(a)(1)(C)
that is expected to last for a continuous
period of more than 90 days.
[(C) Regulations.--The Secretary shall
promulgate regulations specifying exceptions to
the minimum earnings requirements under
subparagraph (A)(ii) for purposes of being
considered an eligible beneficiary for certain
populations.
[(7) Hospital; nursing facility; intermediate care
facility for the mentally retarded; institution for
mental diseases.--The terms ``hospital'', ``nursing
facility'', ``intermediate care facility for the
mentally retarded'', and ``institution for mental
diseases'' have the meanings given such terms for
purposes of Medicaid.
[(8) CLASS independence advisory council.--The term
``CLASS Independence Advisory Council'' or ``Council''
means the Advisory Council established under section
3207 to advise the Secretary.
[(9) CLASS independence benefit plan.--The term
``CLASS Independence Benefit Plan'' means the benefit
plan developed and designated by the Secretary in
accordance with section 3203.
[(10) CLASS independence fund.--The term ``CLASS
Independence Fund'' or ``Fund'' means the fund
established under section 3206.
[(11) Medicaid.--The term ``Medicaid'' means the
program established under title XIX of the Social
Security Act (42 U.S.C. 1396 et seq.).
[(12) Poverty line.--The term ``poverty line'' has
the meaning given that term in section 2110(c)(5) of
the Social Security Act (42 U.S.C. 1397jj(c)(5)).
[(13) Protection and advocacy system.--The term
``Protection and Advocacy System'' means the system for
each State established under section 143 of the
Developmental Disabilities Assistance and Bill of
Rights Act of 2000 (42 U.S.C. 15043).
[SEC. 3203. CLASS INDEPENDENCE BENEFIT PLAN.
[(a) Process for Development.--
[(1) In general.--The Secretary, in consultation with
appropriate actuaries and other experts, shall develop
at least 3 actuarially sound benefit plans as
alternatives for consideration for designation by the
Secretary as the CLASS Independence Benefit Plan under
which eligible beneficiaries shall receive benefits
under this title. Each of the plan alternatives
developed shall be designed to provide eligible
beneficiaries with the benefits described in section
3205 consistent with the following requirements:
[(A) Premiums.--
[(i) In general.--Beginning with the
first year of the CLASS program, and
for each year thereafter, subject to
clauses (ii) and (iii), the Secretary
shall establish all premiums to be paid
by enrollees for the year based on an
actuarial analysis of the 75-year costs
of the program that ensures solvency
throughout such 75-year period.
[(ii) Nominal premium for poorest
individuals and full-time students.--
[(I) In general.--The monthly
premium for enrollment in the
CLASS program shall not exceed
the applicable dollar amount
per month determined under
subclause (II) for--
[(aa) any individual
whose income does not
exceed the poverty
line; and
[(bb) any individual
who has not attained
age 22, and is actively
employed during any
period in which the
individual is a full-
time student (as
determined by the
Secretary).
[(II) Applicable dollar
amount.--The applicable dollar
amount described in this
subclause is the amount equal
to $5, increased by the
percentage increase in the
consumer price index for all
urban consumers (U.S. city
average) for each year
occurring after 2009 and before
such year.
[(iii) Class independence fund
reserves.--At such time as the CLASS
program has been in operation for 10
years, the Secretary shall establish
all premiums to be paid by enrollees
for the year based on an actuarial
analysis that accumulated reserves in
the CLASS Independence Fund would not
decrease in that year. At such time as
the Secretary determines the CLASS
program demonstrates a sustained
ability to finance expected yearly
expenses with expected yearly premiums
and interest credited to the CLASS
Independence Fund, the Secretary may
decrease the required amount of CLASS
Independence Fund reserves.
[(B) Vesting period.--A 5-year vesting period
for eligibility for benefits.
[(C) Benefit triggers.--A benefit trigger for
provision of benefits that requires a
determination that an individual has a
functional limitation, as certified by a
licensed health care practitioner, described in
any of the following clauses that is expected
to last for a continuous period of more than 90
days:
[(i) The individual is determined to
be unable to perform at least the
minimum number (which may be 2 or 3) of
activities of daily living as are
required under the plan for the
provision of benefits without
substantial assistance (as defined by
the Secretary) from another individual.
[(ii) The individual requires
substantial supervision to protect the
individual from threats to health and
safety due to substantial cognitive
impairment.
[(iii) The individual has a level of
functional limitation similar (as
determined under regulations prescribed
by the Secretary) to the level of
functional limitation described in
clause (i) or (ii).
[(D) Cash benefit.--Payment of a cash benefit
that satisfies the following requirements:
[(i) Minimum required amount.--The
benefit amount provides an eligible
beneficiary with not less than an
average of $50 per day (as determined
based on the reasonably expected
distribution of beneficiaries receiving
benefits at various benefit levels).
[(ii) Amount scaled to functional
ability.--The benefit amount is varied
based on a scale of functional ability,
with not less than 2, and not more than
6, benefit level amounts.
[(iii) Daily or weekly.--The benefit
is paid on a daily or weekly basis.
[(iv) No lifetime or aggregate
limit.--The benefit is not subject to
any lifetime or aggregate limit.
[(2) Review and recommendation by the class
independence advisory council.--The CLASS Independence
Advisory Council shall--
[(A) evaluate the alternative benefit plans
developed under paragraph (1); and
[(B) recommend for designation as the CLASS
Independence Benefit Plan for offering to the
public the plan that the Council determines
best balances price and benefits to meet
enrollees' needs in an actuarially sound
manner, while optimizing the probability of the
long-term sustainability of the CLASS program.
[(3) Designation by the secretary.--Not later than
October 1, 2012, the Secretary, taking into
consideration the recommendation of the CLASS
Independence Advisory Council under paragraph (2)(B),
shall designate a benefit plan as the CLASS
Independence Benefit Plan. The Secretary shall publish
such designation, along with details of the plan and
the reasons for the selection by the Secretary, in a
final rule that allows for a period of public comment.
[(b) Additional Premium Requirements.--
[(1) Adjustment of premiums.--
[(A) In general.--Except as provided in
subparagraphs (B), (C), (D), and (E), the
amount of the monthly premium determined for an
individual upon such individual's enrollment in
the CLASS program shall remain the same for as
long as the individual is an active enrollee in
the program.
[(B) Recalculated premium if required for
program solvency.--
[(i) In general.--Subject to clause
(ii), if the Secretary determines,
based on the most recent report of the
Board of Trustees of the CLASS
Independence Fund, the advice of the
CLASS Independence Advisory Council,
and the annual report of the Inspector
General of the Department of Health and
Human Services, and waste, fraud, and
abuse, or such other information as the
Secretary determines appropriate, that
the monthly premiums and income to the
CLASS Independence Fund for a year are
projected to be insufficient with
respect to the 20-year period that
begins with that year, the Secretary
shall adjust the monthly premiums for
individuals enrolled in the CLASS
program as necessary (but maintaining a
nominal premium for enrollees whose
income is below the poverty line or who
are full-time students actively
employed).
[(ii) Exemption from increase.--Any
increase in a monthly premium imposed
as result of a determination described
in clause (i) shall not apply with
respect to the monthly premium of any
active enrollee who--
[(I) has attained age 65;
[(II) has paid premiums for
enrollment in the program for
at least 20 years; and
[(III) is not actively
employed.
[(C) Recalculated premium if reenrollment
after more than a 3-month lapse.--
[(i) In general.--The reenrollment of
an individual after a 90-day period
during which the individual failed to
pay the monthly premium required to
maintain the individual's enrollment in
the CLASS program shall be treated as
an initial enrollment for purposes of
age-adjusting the premium for
reenrollment in the program.
[(ii) Credit for prior months if
reenrolled within 5 years.--An
individual who reenrolls in the CLASS
program after such a 90-day period and
before the end of the 5-year period
that begins with the first month for
which the individual failed to pay the
monthly premium required to maintain
the individual's enrollment in the
program shall be--
[(I) credited with any months
of paid premiums that accrued
prior to the individual's lapse
in enrollment; and
[(II) notwithstanding the
total amount of any such
credited months, required to
satisfy section 3202(6)(A)(ii)
before being eligible to
receive benefits.
[(D) No longer status as a full-time
student.--An individual subject to a nominal
premium on the basis of being described in
subsection (a)(1)(A)(ii)(I)(bb) who ceases to
be described in that subsection, beginning with
the first month following the month in which
the individual ceases to be so described, shall
be subject to the same monthly premium as the
monthly premium that applies to an individual
of the same age who first enrolls in the
program under the most similar circumstances as
the individual (such as the first year of
eligibility for enrollment in the program or in
a subsequent year).
[(E) Penalty for reenollment after 5-year
lapse.--In the case of an individual who
reenrolls in the CLASS program after the end of
the 5-year period described in subparagraph
(C)(ii), the monthly premium required for the
individual shall be the age-adjusted premium
that would be applicable to an initially
enrolling individual who is the same age as the
reenrolling individual, increased by the
greater of--
[(i) an amount that the Secretary
determines is actuarially sound for
each month that occurs during the
period that begins with the first month
for which the individual failed to pay
the monthly premium required to
maintain the individual's enrollment in
the CLASS program and ends with the
month preceding the month in which the
reenollment is effective; or
[(ii) 1 percent of the applicable
age-adjusted premium for each such
month occurring in such period.
[(2) Administrative expenses.--In determining the
monthly premiums for the CLASS program the Secretary
may factor in costs for administering the program, not
to exceed for any year in which the program is in
effect under this title, an amount equal to 3 percent
of all premiums paid during the year.
[(3) No underwriting requirements.--No underwriting
(other than on the basis of age in accordance with
subparagraphs (D) and (E) of paragraph (1)) shall be
used to--
[(A) determine the monthly premium for
enrollment in the CLASS program; or
[(B) prevent an individual from enrolling in
the program.
[(c) Self-attestation and Verification of Income.--The
Secretary shall establish procedures to--
[(1) permit an individual who is eligible for the
nominal premium required under subsection (a)(1)(A)(ii)
to self-attest that their income does not exceed the
poverty line or that their status as a full-time
student who is actively employed;
[(2) verify, using procedures similar to the
procedures used by the Commissioner of Social Security
under section 1631(e)(1)(B)(ii) of the Social Security
Act and consistent with the requirements applicable to
the conveyance of data and information under section
1942 of such Act, the validity of such self-
attestation; and
[(3) require an individual to confirm, on at least an
annual basis, that their income does not exceed the
poverty line or that they continue to maintain such
status.
[SEC. 3204. ENROLLMENT AND DISENROLLMENT REQUIREMENTS.
[(a) Automatic Enrollment.--
[(1) In general.--Subject to paragraph (2), the
Secretary, in coordination with the Secretary of the
Treasury, shall establish procedures under which each
individual described in subsection (c) may be
automatically enrolled in the CLASS program by an
employer of such individual in the same manner as an
employer may elect to automatically enroll employees in
a plan under section 401(k), 403(b), or 457 of the
Internal Revenue Code of 1986.
[(2) Alternative enrollment procedures.--The
procedures established under paragraph (1) shall
provide for an alternative enrollment process for an
individual described in subsection (c) in the case of
such an individual--
[(A) who is self-employed;
[(B) who has more than 1 employer; or
[(C) whose employer does not elect to
participate in the automatic enrollment process
established by the Secretary.
[(3) Administration.--
[(A) In general.--The Secretary and the
Secretary of the Treasury shall, by regulation,
establish procedures to ensure that an
individual is not automatically enrolled in the
CLASS program by more than 1 employer.
[(B) Form.--Enrollment in the CLASS program
shall be made in such manner as the Secretary
may prescribe in order to ensure ease of
administration.
[(b) Election to Opt-Out.--An individual described in
subsection (c) may elect to waive enrollment in the CLASS
program at any time in such form and manner as the Secretary
and the Secretary of the Treasury shall prescribe.
[(c) Individual Described.--For purposes of enrolling in the
CLASS program, an individual described in this paragraph is an
individual--
[(1) who has attained age 18;
[(2) who--
[(A) receives wages or income on which there
is imposed a tax under section 3101(a) or
3201(a) of the Internal Revenue Code of 1986;
or
[(B) derives self-employment income on which
there is imposed a tax under section 1401(a) of
the Internal Revenue Code of 1986;
[(3) who is actively employed; and
[(4) who is not--
[(A) a patient in a hospital or nursing
facility, an intermediate care facility for the
mentally retarded, or an institution for mental
diseases and receiving medical assistance under
Medicaid; or
[(B) confined in a jail, prison, other penal
institution or correctional facility, or by
court order pursuant to conviction of a
criminal offense or in connection with a
verdict or finding described in section
202(x)(1)(A)(ii) of the Social Security Act (42
U.S.C. 402(x)(1)(A)(ii)).
[(d) Rule of Construction.--Nothing in this title shall be
construed as requiring an active enrollee to continue to
satisfy subparagraph (A) or (B) of subsection (c)(2) in order
to maintain enrollment in the CLASS program.
[(e) Payment.--
[(1) Payroll deduction.--An amount equal to the
monthly premium for the enrollment in the CLASS program
of an individual shall be deducted from the wages or
self-employment income of such individual in accordance
with such procedures as the Secretary, in coordination
with the Secretary of the Treasury, shall establish for
employers who elect to deduct and withhold such
premiums on behalf of enrolled employees.
[(2) Alternative payment mechanism.--The Secretary,
in coordination with the Secretary of the Treasury,
shall establish alternative procedures for the payment
of monthly premiums by an individual enrolled in the
CLASS program--
[(A) who does not have an employer who elects
to deduct and withhold premiums in accordance
with paragraph (1); or
[(B) who does not earn wages or derive self-
employment income.
[(f) Transfer of Premiums Collected.--
[(1) In general.--During each calendar year the
Secretary of the Treasury shall deposit into the CLASS
Independence Fund a total amount equal, in the
aggregate, to 100 percent of the premiums collected
during that year.
[(2) Transfers based on estimates.--The amount
deposited pursuant to paragraph (1) shall be
transferred in at least monthly payments to the CLASS
Independence Fund on the basis of estimates by the
Secretary and certified to the Secretary of the
Treasury of the amounts collected in accordance with
subparagraphs (A) and (B) of paragraph (5). Proper
adjustments shall be made in amounts subsequently
transferred to the Fund to the extent prior estimates
were in excess of, or were less than, actual amounts
collected.
[(g) Other Enrollment and Disenrollment Opportunities.--The
Secretary, in coordination with the Secretary of the Treasury,
shall establish procedures under which--
[(1) an individual who, in the year of the
individual's initial eligibility to enroll in the CLASS
program, has not enrolled in the program, is eligible
to elect to enroll in the program, in such form and
manner as the Secretaries shall establish, only during
an open enrollment period established by the
Secretaries that is specific to the individual and that
may not occur more frequently than biennially after the
date on which the individual first elected to waive
enrollment in the program; and
[(2) an individual shall only be permitted to
disenroll from the program (other than for nonpayment
of premiums) during an annual disenrollment period
established by the Secretaries and in such form and
manner as the Secretaries shall establish.
[SEC. 3205. BENEFITS.
[(a) Determination of Eligibility.--
[(1) Application for receipt of benefits.--The
Secretary shall establish procedures under which an
active enrollee shall apply for receipt of benefits
under the CLASS Independence Benefit Plan.
[(2) Eligibility assessments.--
[(A) In general.--Not later than January 1,
2012, the Secretary shall--
[(i) establish an Eligibility
Assessment System (other than a service
with which the Commissioner of Social
Security has entered into an agreement,
with respect to any State, to make
disability determinations for purposes
of title II or XVI of the Social
Security Act) to provide for
eligibility assessments of active
enrollees who apply for receipt of
benefits;
[(ii) enter into an agreement with
the Protection and Advocacy System for
each State to provide advocacy services
in accordance with subsection (d); and
[(iii) enter into an agreement with
public and private entities to provide
advice and assistance counseling in
accordance with subsection (e).
[(B) Regulations.--The Secretary shall
promulgate regulations to develop an expedited
nationally equitable eligibility determination
process, as certified by a licensed health care
practitioner, an appeals process, and a
redetermination process, as certified by a
licensed health care practitioner, including
whether an active enrollee is eligible for a
cash benefit under the program and if so, the
amount of the cash benefit (in accordance the
sliding scale established under the plan).
[(C) Presumptive eligibility for certain
institutionalized enrollees planning to
discharge.--An active enrollee shall be deemed
presumptively eligible if the enrollee--
[(i) has applied for, and attests is
eligible for, the maximum cash benefit
available under the sliding scale
established under the CLASS
Independence Benefit Plan;
[(ii) is a patient in a hospital (but
only if the hospitalization is for
long-term care), nursing facility,
intermediate care facility for the
mentally retarded, or an institution
for mental diseases; and
[(iii) is in the process of, or about
to begin the process of, planning to
discharge from the hospital, facility,
or institution, or within 60 days from
the date of discharge from the
hospital, facility, or institution.
[(D) Appeals.--The Secretary shall establish
procedures under which an applicant for
benefits under the CLASS Independence Benefit
Plan shall be guaranteed the right to appeal an
adverse determination.
[(b) Benefits.--An eligible beneficiary shall receive the
following benefits under the CLASS Independence Benefit Plan:
[(1) Cash benefit.--A cash benefit established by the
Secretary in accordance with the requirements of
section 3203(a)(1)(D) that--
[(A) the first year in which beneficiaries
receive the benefits under the plan, is not
less than the average dollar amount specified
in clause (i) of such section; and
[(B) for any subsequent year, is not less
than the average per day dollar limit
applicable under this subparagraph for the
preceding year, increased by the percentage
increase in the consumer price index for all
urban consumers (U.S. city average) over the
previous year.
[(2) Advocacy services.--Advocacy services in
accordance with subsection (d).
[(3) Advice and assistance counseling.--Advice and
assistance counseling in accordance with subsection
(e).
[(4) Administrative expenses.--Advocacy services and
advise and assistance counseling services under
paragraphs (2) and (3) of this subsection shall be
included as administrative expenses under section
3203(b)(3).
[(c) Payment of Benefits.--
[(1) Life independence account.--
[(A) In general.--The Secretary shall
establish procedures for administering the
provision of benefits to eligible beneficiaries
under the CLASS Independence Benefit Plan,
including the payment of the cash benefit for
the beneficiary into a Life Independence
Account established by the Secretary on behalf
of each eligible beneficiary.
[(B) Use of cash benefits.--Cash benefits
paid into a Life Independence Account of an
eligible beneficiary shall be used to purchase
nonmedical services and supports that the
beneficiary needs to maintain his or her
independence at home or in another residential
setting of their choice in the community,
including (but not limited to) home
modifications, assistive technology, accessible
transportation, homemaker services, respite
care, personal assistance services, home care
aides, and nursing support. Nothing in the
preceding sentence shall prevent an eligible
beneficiary from using cash benefits paid into
a Life Independence Account for obtaining
assistance with decision making concerning
medical care, including the right to accept or
refuse medical or surgical treatment and the
right to formulate advance directives or other
written instructions recognized under State
law, such as a living will or durable power of
attorney for health care, in the case that an
injury or illness causes the individual to be
unable to make health care decisions.
[(C) Electronic management of funds.--The
Secretary shall establish procedures for--
[(i) crediting an account established
on behalf of a beneficiary with the
beneficiary's cash daily benefit;
[(ii) allowing the beneficiary to
access such account through debit
cards; and
[(iii) accounting for withdrawals by
the beneficiary from such account.
[(D) Primary payor rules for beneficiaries
who are enrolled in medicaid.--In the case of
an eligible beneficiary who is enrolled in
Medicaid, the following payment rules shall
apply:
[(i) Institutionalized beneficiary.--
If the beneficiary is a patient in a
hospital, nursing facility,
intermediate care facility for the
mentally retarded, or an institution
for mental diseases, the beneficiary
shall retain an amount equal to 5
percent of the beneficiary's daily or
weekly cash benefit (as applicable)
(which shall be in addition to the
amount of the beneficiary's personal
needs allowance provided under
Medicaid), and the remainder of such
benefit shall be applied toward the
facility's cost of providing the
beneficiary's care, and Medicaid shall
provide secondary coverage for such
care.
[(ii) Beneficiaries receiving home
and community-based services.--
[(I) 50 percent of benefit
retained by beneficiary.--
Subject to subclause (II), if a
beneficiary is receiving
medical assistance under
Medicaid for home and community
based services, the beneficiary
shall retain an amount equal to
50 percent of the beneficiary's
daily or weekly cash benefit
(as applicable), and the
remainder of the daily or
weekly cash benefit shall be
applied toward the cost to the
State of providing such
assistance (and shall not be
used to claim Federal matching
funds under Medicaid), and
Medicaid shall provide
secondary coverage for the
remainder of any costs incurred
in providing such assistance.
[(II) Requirement for state
offset.--A State shall be paid
the remainder of a
beneficiary's daily or weekly
cash benefit under subclause
(I) only if the State home and
community-based waiver under
section 1115 of the Social
Security Act (42 U.S.C. 1315)
or subsection (c) or (d) of
section 1915 of such Act (42
U.S.C. 1396n), or the State
plan amendment under subsection
(i) of such section does not
include a waiver of the
requirements of section
1902(a)(1) of the Social
Security Act (relating to
statewideness) or of section
1902(a)(10)(B) of such Act
(relating to comparability) and
the State offers at a minimum
case management services,
personal care services,
habilitation services, and
respite care under such a
waiver or State plan amendment.
[(III) Definition of home and
community-based services.--In
this clause, the term ``home
and community-based services''
means any services which may be
offered under a home and
community-based waiver
authorized for a State under
section 1115 of the Social
Security Act (42 U.S.C. 1315)
or subsection (c) or (d) of
section 1915 of such Act (42
U.S.C. 1396n) or under a State
plan amendment under subsection
(i) of such section.
[(iii) Beneficiaries enrolled in
programs of all-inclusive care for the
elderly (pace).--
[(I) In general.--Subject to
subclause (II), if a
beneficiary is receiving
medical assistance under
Medicaid for PACE program
services under section 1934 of
the Social Security Act (42
U.S.C. 1396u-4), the
beneficiary shall retain an
amount equal to 50 percent of
the beneficiary's daily or
weekly cash benefit (as
applicable), and the remainder
of the daily or weekly cash
benefit shall be applied toward
the cost to the State of
providing such assistance (and
shall not be used to claim
Federal matching funds under
Medicaid), and Medicaid shall
provide secondary coverage for
the remainder of any costs
incurred in providing such
assistance.
[(II) Institutionalized
recipients of pace program
services.--If a beneficiary
receiving assistance under
Medicaid for PACE program
services is a patient in a
hospital, nursing facility,
intermediate care facility for
the mentally retarded, or an
institution for mental
diseases, the beneficiary shall
be treated as in
institutionalized beneficiary
under clause (i).
[(2) Authorized representatives.--
[(A) In general.--The Secretary shall
establish procedures to allow access to a
beneficiary's cash benefits by an authorized
representative of the eligible beneficiary on
whose behalf such benefits are paid.
[(B) Quality assurance and protection against
fraud and abuse.--The procedures established
under subparagraph (A) shall ensure that
authorized representatives of eligible
beneficiaries comply with standards of conduct
established by the Secretary, including
standards requiring that such representatives
provide quality services on behalf of such
beneficiaries, do not have conflicts of
interest, and do not misuse benefits paid on
behalf of such beneficiaries or otherwise
engage in fraud or abuse.
[(3) Commencement of benefits.--Benefits shall be
paid to, or on behalf of, an eligible beneficiary
beginning with the first month in which an application
for such benefits is approved.
[(4) Rollover option for lump-sum payment.--An
eligible beneficiary may elect to--
[(A) defer payment of their daily or weekly
benefit and to rollover any such deferred
benefits from month-to-month, but not from
year-to-year; and
[(B) receive a lump-sum payment of such
deferred benefits in an amount that may not
exceed the lesser of--
[(i) the total amount of the accrued
deferred benefits; or
[(ii) the applicable annual benefit.
[(5) Period for determination of annual benefits.--
[(A) In general.--The applicable period for
determining with respect to an eligible
beneficiary the applicable annual benefit and
the amount of any accrued deferred benefits is
the 12-month period that commences with the
first month in which the beneficiary began to
receive such benefits, and each 12-month period
thereafter.
[(B) Inclusion of increased benefits.--The
Secretary shall establish procedures under
which cash benefits paid to an eligible
beneficiary that increase or decrease as a
result of a change in the functional status of
the beneficiary before the end of a 12-month
benefit period shall be included in the
determination of the applicable annual benefit
paid to the eligible beneficiary.
[(C) Recoupment of unpaid, accrued
benefits.--
[(i) In general.--The Secretary, in
coordination with the Secretary of the
Treasury, shall recoup any accrued
benefits in the event of--
[(I) the death of a
beneficiary; or
[(II) the failure of a
beneficiary to elect under
paragraph (4)(B) to receive
such benefits as a lump-sum
payment before the end of the
12-month period in which such
benefits accrued.
[(ii) Payment into class independence
fund.--Any benefits recouped in
accordance with clause (i) shall be
paid into the CLASS Independence Fund
and used in accordance with section
3206.
[(6) Requirement to recertify eligibility for receipt
of benefits.--An eligible beneficiary shall
periodically, as determined by the Secretary--
[(A) recertify by submission of medical
evidence the beneficiary's continued
eligibility for receipt of benefits; and
[(B) submit records of expenditures
attributable to the aggregate cash benefit
received by the beneficiary during the
preceding year.
[(7) Supplement, not supplant other health care
benefits.--Subject to the Medicaid payment rules under
paragraph (1)(D), benefits received by an eligible
beneficiary shall supplement, but not supplant, other
health care benefits for which the beneficiary is
eligible under Medicaid or any other Federally funded
program that provides health care benefits or
assistance.
[(d) Advocacy Services.--An agreement entered into under
subsection (a)(2)(A)(ii) shall require the Protection and
Advocacy System for the State to--
[(1) assign, as needed, an advocacy counselor to each
eligible beneficiary that is covered by such agreement
and who shall provide an eligible beneficiary with--
[(A) information regarding how to access the
appeals process established for the program;
[(B) assistance with respect to the annual
recertification and notification required under
subsection (c)(6); and
[(C) such other assistance with obtaining
services as the Secretary, by regulation, shall
require; and
[(2) ensure that the System and such counselors
comply with the requirements of subsection (h).
[(e) Advice and Assistance Counseling.--An agreement entered
into under subsection (a)(2)(A)(iii) shall require the entity
to assign, as requested by an eligible beneficiary that is
covered by such agreement, an advice and assistance counselor
who shall provide an eligible beneficiary with information
regarding--
[(1) accessing and coordinating long-term services
and supports in the most integrated setting;
[(2) possible eligibility for other benefits and
services;
[(3) development of a service and support plan;
[(4) information about programs established under the
Assistive Technology Act of 1998 and the services
offered under such programs;
[(5) available assistance with decision making
concerning medical care, including the right to accept
or refuse medical or surgical treatment and the right
to formulate advance directives or other written
instructions recognized under State law, such as a
living will or durable power of attorney for health
care, in the case that an injury or illness causes the
individual to be unable to make health care decisions;
and
[(6) such other services as the Secretary, by
regulation, may require.
[(f) No Effect on Eligibility for Other Benefits.--Benefits
paid to an eligible beneficiary under the CLASS program shall
be disregarded for purposes of determining or continuing the
beneficiary's eligibility for receipt of benefits under any
other Federal, State, or locally funded assistance program,
including benefits paid under titles II, XVI, XVIII, XIX, or
XXI of the Social Security Act (42 U.S.C. 401 et seq., 1381 et
seq., 1395 et seq., 1396 et seq., 1397aa et seq.), under the
laws administered by the Secretary of Veterans Affairs, under
low-income housing assistance programs, or under the
supplemental nutrition assistance program established under the
Food and Nutrition Act of 2008 (7 U.S.C. 2011 et seq.).
[(g) Rule of Construction.--Nothing in this title shall be
construed as prohibiting benefits paid under the CLASS
Independence Benefit Plan from being used to compensate a
family caregiver for providing community living assistance
services and supports to an eligible beneficiary.
[(h) Protection Against Conflict of Interests.--The Secretary
shall establish procedures to ensure that the Eligibility
Assessment System, the Protection and Advocacy System for a
State, advocacy counselors for eligible beneficiaries, and any
other entities that provide services to active enrollees and
eligible beneficiaries under the CLASS program comply with the
following:
[(1) If the entity provides counseling or planning
services, such services are provided in a manner that
fosters the best interests of the active enrollee or
beneficiary.
[(2) The entity has established operating procedures
that are designed to avoid or minimize conflicts of
interest between the entity and an active enrollee or
beneficiary.
[(3) The entity provides information about all
services and options available to the active enrollee
or beneficiary, to the best of its knowledge, including
services available through other entities or providers.
[(4) The entity assists the active enrollee or
beneficiary to access desired services, regardless of
the provider.
[(5) The entity reports the number of active
enrollees and beneficiaries provided with assistance by
age, disability, and whether such enrollees and
beneficiaries received services from the entity or
another entity.
[(6) If the entity provides counseling or planning
services, the entity ensures that an active enrollee or
beneficiary is informed of any financial interest that
the entity has in a service provider.
[(7) The entity provides an active enrollee or
beneficiary with a list of available service providers
that can meet the needs of the active enrollee or
beneficiary.
[SEC. 3206. CLASS INDEPENDENCE FUND.
[(a) Establishment of CLASS Independence Fund.--There is
established in the Treasury of the United States a trust fund
to be known as the ``CLASS Independence Fund''. The Secretary
of the Treasury shall serve as Managing Trustee of such Fund.
The Fund shall consist of all amounts derived from payments
into the Fund under sections 3204(f) and 3205(c)(5)(C)(ii), and
remaining after investment of such amounts under subsection
(b), including additional amounts derived as income from such
investments. The amounts held in the Fund are appropriated and
shall remain available without fiscal year limitation--
[(1) to be held for investment on behalf of
individuals enrolled in the CLASS program;
[(2) to pay the administrative expenses related to
the Fund and to investment under subsection (b); and
[(3) to pay cash benefits to eligible beneficiaries
under the CLASS Independence Benefit Plan.
[(b) Investment of Fund Balance.--The Secretary of the
Treasury shall invest and manage the CLASS Independence Fund in
the same manner, and to the same extent, as the Federal
Supplementary Medical Insurance Trust Fund may be invested and
managed under subsections (c), (d), and (e) of section 1841(d)
of the Social Security Act (42 U.S.C. 1395t).
[(c) Board of Trustees.--
[(1) In general.--With respect to the CLASS
Independence Fund, there is hereby created a body to be
known as the Board of Trustees of the CLASS
Independence Fund (hereinafter in this section referred
to as the ``Board of Trustees'') composed of the
Secretary of the Treasury, the Secretary of Labor, and
the Secretary of Health and Human Services, all ex
officio, and of two members of the public (both of whom
may not be from the same political party), who shall be
nominated by the President for a term of 4 years and
subject to confirmation by the Senate. A member of the
Board of Trustees serving as a member of the public and
nominated and confirmed to fill a vacancy occurring
during a term shall be nominated and confirmed only for
the remainder of such term. An individual nominated and
confirmed as a member of the public may serve in such
position after the expiration of such member's term
until the earlier of the time at which the member's
successor takes office or the time at which a report of
the Board is first issued under paragraph (2) after the
expiration of the member's term. The Secretary of the
Treasury shall be the Managing Trustee of the Board of
Trustees. The Board of Trustees shall meet not less
frequently than once each calendar year. A person
serving on the Board of Trustees shall not be
considered to be a fiduciary and shall not be
personally liable for actions taken in such capacity
with respect to the Trust Fund.
[(2) Duties.--
[(A) In general.--It shall be the duty of the
Board of Trustees to do the following:
[(i) Hold the CLASS Independence
Fund.
[(ii) Report to the Congress not
later than the first day of April of
each year on the operation and status
of the CLASS Independence Fund during
the preceding fiscal year and on its
expected operation and status during
the current fiscal year and the next 2
fiscal years.
[(iii) Report immediately to the
Congress whenever the Board is of the
opinion that the amount of the CLASS
Independence Fund is not actuarially
sound in regards to the projection
under section 3203(b)(1)(B)(i).
[(iv) Review the general policies
followed in managing the CLASS
Independence Fund, and recommend
changes in such policies, including
necessary changes in the provisions of
law which govern the way in which the
CLASS Independence Fund is to be
managed.
[(B) Report.--The report provided for in
subparagraph (A)(ii) shall--
[(i) include--
[(I) a statement of the
assets of, and the
disbursements made from, the
CLASS Independence Fund during
the preceding fiscal year;
[(II) an estimate of the
expected income to, and
disbursements to be made from,
the CLASS Independence Fund
during the current fiscal year
and each of the next 2 fiscal
years;
[(III) a statement of the
actuarial status of the CLASS
Independence Fund for the
current fiscal year, each of
the next 2 fiscal years, and as
projected over the 75-year
period beginning with the
current fiscal year; and
[(IV) an actuarial opinion by
the Chief Actuary of the
Centers for Medicare & Medicaid
Services certifying that the
techniques and methodologies
used are generally accepted
within the actuarial profession
and that the assumptions and
cost estimates used are
reasonable; and
[(ii) be printed as a House document
of the session of the Congress to which
the report is made.
[(C) Recommendations.--If the Board of
Trustees determines that enrollment trends and
expected future benefit claims on the CLASS
Independence Fund are not actuarially sound in
regards to the projection under section
3203(b)(1)(B)(i) and are unlikely to be
resolved with reasonable premium increases or
through other means, the Board of Trustees
shall include in the report provided for in
subparagraph (A)(ii) recommendations for such
legislative action as the Board of Trustees
determine to be appropriate, including whether
to adjust monthly premiums or impose a
temporary moratorium on new enrollments.
[SEC. 3207. CLASS INDEPENDENCE ADVISORY COUNCIL.
[(a) Establishment.--There is hereby created an Advisory
Committee to be known as the ``CLASS Independence Advisory
Council''.
[(b) Membership.--
[(1) In general.--The CLASS Independence Advisory
Council shall be composed of not more than 15
individuals, not otherwise in the employ of the United
States--
[(A) who shall be appointed by the President
without regard to the civil service laws and
regulations; and
[(B) a majority of whom shall be
representatives of individuals who participate
or are likely to participate in the CLASS
program, and shall include representatives of
older and younger workers, individuals with
disabilities, family caregivers of individuals
who require services and supports to maintain
their independence at home or in another
residential setting of their choice in the
community, individuals with expertise in long-
term care or disability insurance, actuarial
science, economics, and other relevant
disciplines, as determined by the Secretary.
[(2) Terms.--
[(A) In general.--The members of the CLASS
Independence Advisory Council shall serve
overlapping terms of 3 years (unless appointed
to fill a vacancy occurring prior to the
expiration of a term, in which case the
individual shall serve for the remainder of the
term).
[(B) Limitation.--A member shall not be
eligible to serve for more than 2 consecutive
terms.
[(3) Chair.--The President shall, from time to time,
appoint one of the members of the CLASS Independence
Advisory Council to serve as the Chair.
[(c) Duties.--The CLASS Independence Advisory Council shall
advise the Secretary on matters of general policy in the
administration of the CLASS program established under this
title and in the formulation of regulations under this title
including with respect to--
[(1) the development of the CLASS Independence
Benefit Plan under section 3203;
[(2) the determination of monthly premiums under such
plan; and
[(3) the financial solvency of the program.
[(d) Application of FACA.--The Federal Advisory Committee Act
(5 U.S.C. App.), other than section 14 of that Act, shall apply
to the CLASS Independence Advisory Council.
[(e) Authorization of Appropriations.--
[(1) In general.--There are authorized to be
appropriated to the CLASS Independence Advisory Council
to carry out its duties under this section, such sums
as may be necessary for fiscal year 2011 and for each
fiscal year thereafter.
[(2) Availability.--Any sums appropriated under the
authorization contained in this section shall remain
available, without fiscal year limitation, until
expended.
[SEC. 3208. SOLVENCY AND FISCAL INDEPENDENCE; REGULATIONS; ANNUAL
REPORT.
[(a) Solvency.--The Secretary shall regularly consult with
the Board of Trustees of the CLASS Independence Fund and the
CLASS Independence Advisory Council, for purposes of ensuring
that enrollees premiums are adequate to ensure the financial
solvency of the CLASS program, both with respect to fiscal
years occurring in the near-term and fiscal years occurring
over 20- and 75-year periods, taking into account the
projections required for such periods under subsections
(a)(1)(A)(i) and (b)(1)(B)(i) of section 3202.
[(b) No Taxpayer Funds Used To Pay Benefits.--No taxpayer
funds shall be used for payment of benefits under a CLASS
Independent Benefit Plan. For purposes of this subsection, the
term ``taxpayer funds'' means any Federal funds from a source
other than premiums deposited by CLASS program participants in
the CLASS Independence Fund and any associated interest
earnings.
[(c) Regulations.--The Secretary shall promulgate such
regulations as are necessary to carry out the CLASS program in
accordance with this title. Such regulations shall include
provisions to prevent fraud and abuse under the program.
[(d) Annual Report.--Beginning January 1, 2014, the Secretary
shall submit an annual report to Congress on the CLASS program.
Each report shall include the following:
[(1) The total number of enrollees in the program.
[(2) The total number of eligible beneficiaries
during the fiscal year.
[(3) The total amount of cash benefits provided
during the fiscal year.
[(4) A description of instances of fraud or abuse
identified during the fiscal year.
[(5) Recommendations for such administrative or
legislative action as the Secretary determines is
necessary to improve the program, ensure the solvency
of the program, or to prevent the occurrence of fraud
or abuse.
[SEC. 3209. INSPECTOR GENERAL'S REPORT.
[The Inspector General of the Department of Health and Human
Services shall submit an annual report to the Secretary and
Congress relating to the overall progress of the CLASS program
and of the existence of waste, fraud, and abuse in the CLASS
program. Each such report shall include findings in the
following areas:
[(1) The eligibility determination process.
[(2) The provision of cash benefits.
[(3) Quality assurance and protection against waste,
fraud, and abuse.
[(4) Recouping of unpaid and accrued benefits.
[SEC. 3210. TAX TREATMENT OF PROGRAM.
[The CLASS program shall be treated for purposes of the
Internal Revenue Code of 1986 in the same manner as a qualified
long-term care insurance contract for qualified long-term care
services.]
----------
PATIENT PROTECTION AND AFFORDABLE CARE ACT
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Patient
Protection and Affordable Care Act''.
(b) Table of Contents.--The table of contents of this Act is
as follows:
Sec. 1. Short title; table of contents.
* * * * * * *
[TITLE VIII--CLASS ACT
[Sec. 8001. Short title of title.
[Sec. 8002. Establishment of national voluntary insurance program for
purchasing community living assistance services and support.]
* * * * * * *
[TITLE VIII--CLASS ACT
[SEC. 8001. SHORT TITLE OF TITLE.
[This title may be cited as the ``Community Living Assistance
Services and Supports Act'' or the ``CLASS Act''.
[SEC. 8002. ESTABLISHMENT OF NATIONAL VOLUNTARY INSURANCE PROGRAM FOR
PURCHASING COMMUNITY LIVING ASSISTANCE SERVICES AND
SUPPORT.
[(a) Establishment of CLASS Program.--
[(1) In general.--The Public Health Service Act (42
U.S.C. 201 et seq.), as amended by section 4302(a), is
amended by adding at the end the following:
[``TITLE XXXII--COMMUNITY LIVING ASSISTANCE SERVICES AND SUPPORTS
[``SEC. 3201. PURPOSE.
[The purpose of this title is to establish a national
voluntary insurance program for purchasing community living
assistance services and supports in order to--
[``(1) provide individuals with functional
limitations with tools that will allow them to maintain
their personal and financial independence and live in
the community through a new financing strategy for
community living assistance services and supports;
[``(2) establish an infrastructure that will help
address the Nation's community living assistance
services and supports needs;
[``(3) alleviate burdens on family caregivers; and
[``(4) address institutional bias by providing a
financing mechanism that supports personal choice and
independence to live in the community.
[``SEC. 3202. DEFINITIONS.
[In this title:
[``(1) Active enrollee.--The term `active enrollee'
means an individual who is enrolled in the CLASS
program in accordance with section 3204 and who has
paid any premiums due to maintain such enrollment.
[``(2) Actively employed.--The term `actively
employed' means an individual who--
[``(A) is reporting for work at the
individual's usual place of employment or at
another location to which the individual is
required to travel because of the individual's
employment (or in the case of an individual who
is a member of the uniformed services, is on
active duty and is physically able to perform
the duties of the individual's position); and
[``(B) is able to perform all the usual and
customary duties of the individual's employment
on the individual's regular work schedule.
[``(3) Activities of daily living.--The term
`activities of daily living' means each of the
following activities specified in section
7702B(c)(2)(B) of the Internal Revenue Code of 1986:
[``(A) Eating.
[``(B) Toileting.
[``(C) Transferring.
[``(D) Bathing.
[``(E) Dressing.
[``(F) Continence.
[``(4) CLASS program.--The term `CLASS program' means
the program established under this title.
[``(5) Eligibility assessment system.--The term
`Eligibility Assessment System' means the entity
established by the Secretary under section 3205(a)(2)
to make functional eligibility determinations for the
CLASS program.
[``(6) Eligible beneficiary.--
[``(A) In general.--The term `eligible
beneficiary' means any individual who is an
active enrollee in the CLASS program and, as of
the date described in subparagraph (B)--
[``(i) has paid premiums for
enrollment in such program for at least
60 months;
[``(ii) has earned, with respect to
at least 3 calendar years that occur
during the first 60 months for which
the individual has paid premiums for
enrollment in the program, at least an
amount equal to the amount of wages and
self-employment income which an
individual must have in order to be
credited with a quarter of coverage
under section 213(d) of the Social
Security Act for the year; and
[``(iii) has paid premiums for
enrollment in such program for at least
24 consecutive months, if a lapse in
premium payments of more than 3 months
has occurred during the period that
begins on the date of the individual's
enrollment and ends on the date of such
determination.
[``(B) Date described.--For purposes of
subparagraph (A), the date described in this
subparagraph is the date on which the
individual is determined to have a functional
limitation described in section 3203(a)(1)(C)
that is expected to last for a continuous
period of more than 90 days.
[``(C) Regulations.--The Secretary shall
promulgate regulations specifying exceptions to
the minimum earnings requirements under
subparagraph (A)(ii) for purposes of being
considered an eligible beneficiary for certain
populations.
[``(7) Hospital; nursing facility; intermediate care
facility for the mentally retarded; institution for
mental diseases.--The terms `hospital', `nursing
facility', `intermediate care facility for the mentally
retarded', and `institution for mental diseases' have
the meanings given such terms for purposes of Medicaid.
[``(8) CLASS independence advisory council.--The term
`CLASS Independence Advisory Council' or `Council'
means the Advisory Council established under section
3207 to advise the Secretary.
[``(9) CLASS independence benefit plan.--The term
`CLASS Independence Benefit Plan' means the benefit
plan developed and designated by the Secretary in
accordance with section 3203.
[``(10) CLASS independence fund.--The term `CLASS
Independence Fund' or `Fund' means the fund established
under section 3206.
[``(11) Medicaid.--The term `Medicaid' means the
program established under title XIX of the Social
Security Act (42 U.S.C. 1396 et seq.).
[``(12) Poverty line.--The term `poverty line' has
the meaning given that term in section 2110(c)(5) of
the Social Security Act (42 U.S.C. 1397jj(c)(5)).
[``(13) Protection and advocacy system.--The term
`Protection and Advocacy System' means the system for
each State established under section 143 of the
Developmental Disabilities Assistance and Bill of
Rights Act of 2000 (42 U.S.C. 15043).
[``SEC. 3203. CLASS INDEPENDENCE BENEFIT PLAN.
[``(a) Process for development.--
[``(1) In general.--The Secretary, in consultation
with appropriate actuaries and other experts, shall
develop at least 3 actuarially sound benefit plans as
alternatives for consideration for designation by the
Secretary as the CLASS Independence Benefit Plan under
which eligible beneficiaries shall receive benefits
under this title. Each of the plan alternatives
developed shall be designed to provide eligible
beneficiaries with the benefits described in section
3205 consistent with the following requirements:
[``(A) Premiums.--
[``(i) In general.--Beginning with
the first year of the CLASS program,
and for each year thereafter, subject
to clauses (ii) and (iii), the
Secretary shall establish all premiums
to be paid by enrollees for the year
based on an actuarial analysis of the
75-year costs of the program that
ensures solvency throughout such 75-
year period.
[``(ii) Nominal premium for poorest
individuals and full-time students.--
[``(I) In general.--The
monthly premium for enrollment
in the CLASS program shall not
exceed the applicable dollar
amount per month determined
under subclause (II) for--
[``(aa) any
individual whose income
does not exceed the
poverty line; and
[``(bb) any
individual who has not
attained age 22, and is
actively employed
during any period in
which the individual is
a full-time student (as
determined by the
Secretary).
[``(II) Applicable dollar
amount.--The applicable dollar
amount described in this
subclause is the amount equal
to $5, increased by the
percentage increase in the
consumer price index for all
urban consumers (U.S. city
average) for each year
occurring after 2009 and before
such year.
[``(iii) Class independence fund
reserves.--At such time as the CLASS
program has been in operation for 10
years, the Secretary shall establish
all premiums to be paid by enrollees
for the year based on an actuarial
analysis that accumulated reserves in
the CLASS Independence Fund would not
decrease in that year. At such time as
the Secretary determines the CLASS
program demonstrates a sustained
ability to finance expected yearly
expenses with expected yearly premiums
and interest credited to the CLASS
Independence Fund, the Secretary may
decrease the required amount of CLASS
Independence Fund reserves.
[``(B) Vesting period.--A 5-year vesting
period for eligibility for benefits.
[``(C) Benefit triggers.--A benefit trigger
for provision of benefits that requires a
determination that an individual has a
functional limitation, as certified by a
licensed health care practitioner, described in
any of the following clauses that is expected
to last for a continuous period of more than 90
days:
[``(i) The individual is determined
to be unable to perform at least the
minimum number (which may be 2 or 3) of
activities of daily living as are
required under the plan for the
provision of benefits without
substantial assistance (as defined by
the Secretary) from another individual.
[``(ii) The individual requires
substantial supervision to protect the
individual from threats to health and
safety due to substantial cognitive
impairment.
[``(iii) The individual has a level
of functional limitation similar (as
determined under regulations prescribed
by the Secretary) to the level of
functional limitation described in
clause (i) or (ii).
[``(D) Cash benefit.--Payment of a cash
benefit that satisfies the following
requirements:
[``(i) Minimum required amount.--The
benefit amount provides an eligible
beneficiary with not less than an
average of $50 per day (as determined
based on the reasonably expected
distribution of beneficiaries receiving
benefits at various benefit levels).
[``(ii) Amount scaled to functional
ability.--The benefit amount is varied
based on a scale of functional ability,
with not less than 2, and not more than
6, benefit level amounts.
[``(iii) Daily or weekly.--The
benefit is paid on a daily or weekly
basis.
[``(iv) No lifetime or aggregate
limit.--The benefit is not subject to
any lifetime or aggregate limit.
[``(2) Review and recommendation by the CLASS
independence advisory council.--The CLASS Independence
Advisory Council shall--
[``(A) evaluate the alternative benefit plans
developed under paragraph (1); and
[``(B) recommend for designation as the CLASS
Independence Benefit Plan for offering to the
public the plan that the Council determines
best balances price and benefits to meet
enrollees' needs in an actuarially sound
manner, while optimizing the probability of the
long-term sustainability of the CLASS program.
[``(3) Designation by the secretary.--Not later than
October 1, 2012, the Secretary, taking into
consideration the recommendation of the CLASS
Independence Advisory Council under paragraph (2)(B),
shall designate a benefit plan as the CLASS
Independence Benefit Plan. The Secretary shall publish
such designation, along with details of the plan and
the reasons for the selection by the Secretary, in a
final rule that allows for a period of public comment.
[``(b) Additional premium requirements.--
[``(1) Adjustment of premiums.--
[``(A) In general.--Except as provided in
subparagraphs (B), (C), (D), and (E), the
amount of the monthly premium determined for an
individual upon such individual's enrollment in
the CLASS program shall remain the same for as
long as the individual is an active enrollee in
the program.
[``(B) Recalculated premium if required for
program solvency.--
[``(i) In general.--Subject to clause
(ii), if the Secretary determines,
based on the most recent report of the
Board of Trustees of the CLASS
Independence Fund, the advice of the
CLASS Independence Advisory Council,
and the annual report of the Inspector
General of the Department of Health and
Human Services, and waste, fraud, and
abuse, or such other information as the
Secretary determines appropriate, that
the monthly premiums and income to the
CLASS Independence Fund for a year are
projected to be insufficient with
respect to the 20-year period that
begins with that year, the Secretary
shall adjust the monthly premiums for
individuals enrolled in the CLASS
program as necessary (but maintaining a
nominal premium for enrollees whose
income is below the poverty line or who
are full-time students actively
employed).
[``(ii) Exemption from increase.--Any
increase in a monthly premium imposed
as result of a determination described
in clause (i) shall not apply with
respect to the monthly premium of any
active enrollee who--
[``(I) has attained age 65;
[``(II) has paid premiums for
enrollment in the program for
at least 20 years; and
[``(III) is not actively
employed.
[``(C) Recalculated premium if reenrollment
after more than a 3-month lapse.--
[``(i) In general.--The reenrollment
of an individual after a 90-day period
during which the individual failed to
pay the monthly premium required to
maintain the individual's enrollment in
the CLASS program shall be treated as
an initial enrollment for purposes of
age-adjusting the premium for
reenrollment in the program.
[``(ii) Credit for prior months if
reenrolled within 5 years.--An
individual who reenrolls in the CLASS
program after such a 90-day period and
before the end of the 5-year period
that begins with the first month for
which the individual failed to pay the
monthly premium required to maintain
the individual's enrollment in the
program shall be--
[``(I) credited with any
months of paid premiums that
accrued prior to the
individual's lapse in
enrollment; and
[``(II) notwithstanding the
total amount of any such
credited months, required to
satisfy section 3202(6)(A)(ii)
before being eligible to
receive benefits.
[``(D) No longer status as a full-time
student.--An individual subject to a nominal
premium on the basis of being described in
subsection (a)(1)(A)(ii)(I)(bb) who ceases to
be described in that subsection, beginning with
the first month following the month in which
the individual ceases to be so described, shall
be subject to the same monthly premium as the
monthly premium that applies to an individual
of the same age who first enrolls in the
program under the most similar circumstances as
the individual (such as the first year of
eligibility for enrollment in the program or in
a subsequent year).
[``(E) Penalty for reenollment after 5-year
lapse.--In the case of an individual who
reenrolls in the CLASS program after the end of
the 5-year period described in subparagraph
(C)(ii), the monthly premium required for the
individual shall be the age-adjusted premium
that would be applicable to an initially
enrolling individual who is the same age as the
reenrolling individual, increased by the
greater of--
[``(i) an amount that the Secretary
determines is actuarially sound for
each month that occurs during the
period that begins with the first month
for which the individual failed to pay
the monthly premium required to
maintain the individual's enrollment in
the CLASS program and ends with the
month preceding the month in which the
reenollment is effective; or
[``(ii) 1 percent of the applicable
age-adjusted premium for each such
month occurring in such period.
[``(2) Administrative expenses.--In determining the
monthly premiums for the CLASS program the Secretary
may factor in costs for administering the program, not
to exceed for any year in which the program is in
effect under this title, an amount equal to 3 percent
of all premiums paid during the year.
[``(3) No underwriting requirements.--No underwriting
(other than on the basis of age in accordance with
subparagraphs (D) and (E) of paragraph (1)) shall be
used to--
[``(A) determine the monthly premium for
enrollment in the CLASS program; or
[``(B) prevent an individual from enrolling
in the program.
[``(c) Self-attestation and verification of income.--The
Secretary shall establish procedures to--
[``(1) permit an individual who is eligible for the
nominal premium required under subsection (a)(1)(A)(ii)
to self-attest that their income does not exceed the
poverty line or that their status as a full-time
student who is actively employed;
[``(2) verify, using procedures similar to the
procedures used by the Commissioner of Social Security
under section 1631(e)(1)(B)(ii) of the Social Security
Act and consistent with the requirements applicable to
the conveyance of data and information under section
1942 of such Act, the validity of such self-
attestation; and
[``(3) require an individual to confirm, on at least
an annual basis, that their income does not exceed the
poverty line or that they continue to maintain such
status.
[``SEC. 3204. ENROLLMENT AND DISENROLLMENT REQUIREMENTS.
[``(a) Automatic Enrollment.--
[``(1) In general.--Subject to paragraph (2), the
Secretary, in coordination with the Secretary of the
Treasury, shall establish procedures under which each
individual described in subsection (c) may be
automatically enrolled in the CLASS program by an
employer of such individual in the same manner as an
employer may elect to automatically enroll employees in
a plan under section 401(k), 403(b), or 457 of the
Internal Revenue Code of 1986.
[``(2) Alternative enrollment procedures.--The
procedures established under paragraph (1) shall
provide for an alternative enrollment process for an
individual described in subsection (c) in the case of
such an individual--
[``(A) who is self-employed;
[``(B) who has more than 1 employer; or
[``(C) whose employer does not elect to
participate in the automatic enrollment process
established by the Secretary.
[``(3) Administration.--
[``(A) In general.--The Secretary and the
Secretary of the Treasury shall, by regulation,
establish procedures to ensure that an
individual is not automatically enrolled in the
CLASS program by more than 1 employer.
[``(B) Form.--Enrollment in the CLASS program
shall be made in such manner as the Secretary
may prescribe in order to ensure ease of
administration.
[``(b) Election to Opt-Out.--An individual described in
subsection (c) may elect to waive enrollment in the CLASS
program at any time in such form and manner as the Secretary
and the Secretary of the Treasury shall prescribe.
[``(c) Individual Described.--For purposes of enrolling in
the CLASS program, an individual described in this paragraph is
an individual--
[``(1) who has attained age 18;
[``(2) who--
[``(A) receives wages or income on which
there is imposed a tax under section 3101(a) or
3201(a) of the Internal Revenue Code of 1986;
or
[``(B) derives self-employment income on
which there is imposed a tax under section
1401(a) of the Internal Revenue Code of 1986;
[``(3) who is actively employed; and
[``(4) who is not--
[``(A) a patient in a hospital or nursing
facility, an intermediate care facility for the
mentally retarded, or an institution for mental
diseases and receiving medical assistance under
Medicaid; or
[``(B) confined in a jail, prison, other
penal institution or correctional facility, or
by court order pursuant to conviction of a
criminal offense or in connection with a
verdict or finding described in section
202(x)(1)(A)(ii) of the Social Security Act (42
U.S.C. 402(x)(1)(A)(ii)).
[``(d) Rule of Construction.--Nothing in this title shall be
construed as requiring an active enrollee to continue to
satisfy subparagraph (A) or (B) of subsection (c)(2) in order
to maintain enrollment in the CLASS program.
[``(e) Payment.--
[``(1) Payroll deduction.--An amount equal to the
monthly premium for the enrollment in the CLASS program
of an individual shall be deducted from the wages or
self-employment income of such individual in accordance
with such procedures as the Secretary, in coordination
with the Secretary of the Treasury, shall establish for
employers who elect to deduct and withhold such
premiums on behalf of enrolled employees.
[``(2) Alternative payment mechanism.--The Secretary,
in coordination with the Secretary of the Treasury,
shall establish alternative procedures for the payment
of monthly premiums by an individual enrolled in the
CLASS program--
[``(A) who does not have an employer who
elects to deduct and withhold premiums in
accordance with paragraph (1); or
[``(B) who does not earn wages or derive
self-employment income.
[``(f) Transfer of Premiums Collected.--
[``(1) In general.--During each calendar year the
Secretary of the Treasury shall deposit into the CLASS
Independence Fund a total amount equal, in the
aggregate, to 100 percent of the premiums collected
during that year.
[``(2) Transfers based on estimates.--The amount
deposited pursuant to paragraph (1) shall be
transferred in at least monthly payments to the CLASS
Independence Fund on the basis of estimates by the
Secretary and certified to the Secretary of the
Treasury of the amounts collected in accordance with
subparagraphs (A) and (B) of paragraph (5). Proper
adjustments shall be made in amounts subsequently
transferred to the Fund to the extent prior estimates
were in excess of, or were less than, actual amounts
collected.
[``(g) Other Enrollment and Disenrollment Opportunities.--The
Secretary, in coordination with the Secretary of the Treasury,
shall establish procedures under which--
[``(1) an individual who, in the year of the
individual's initial eligibility to enroll in the CLASS
program, has not enrolled in the program, is eligible
to elect to enroll in the program, in such form and
manner as the Secretaries shall establish, only during
an open enrollment period established by the
Secretaries that is specific to the individual and that
may not occur more frequently than biennially after the
date on which the individual first elected to waive
enrollment in the program; and
[``(2) an individual shall only be permitted to
disenroll from the program (other than for nonpayment
of premiums) during an annual disenrollment period
established by the Secretaries and in such form and
manner as the Secretaries shall establish.
[``SEC. 3205. BENEFITS.
[``(a) Determination of Eligibility.--
[``(1) Application for receipt of benefits.--The
Secretary shall establish procedures under which an
active enrollee shall apply for receipt of benefits
under the CLASS Independence Benefit Plan.
[``(2) Eligibility assessments.--
[``(A) In general.--Not later than January 1,
2012, the Secretary shall--
[``(i) establish an Eligibility
Assessment System (other than a service
with which the Commissioner of Social
Security has entered into an agreement,
with respect to any State, to make
disability determinations for purposes
of title II or XVI of the Social
Security Act) to provide for
eligibility assessments of active
enrollees who apply for receipt of
benefits;
[``(ii) enter into an agreement with
the Protection and Advocacy System for
each State to provide advocacy services
in accordance with subsection (d); and
[``(iii) enter into an agreement with
public and private entities to provide
advice and assistance counseling in
accordance with subsection (e).
[``(B) Regulations.--The Secretary shall
promulgate regulations to develop an expedited
nationally equitable eligibility determination
process, as certified by a licensed health care
practitioner, an appeals process, and a
redetermination process, as certified by a
licensed health care practitioner, including
whether an active enrollee is eligible for a
cash benefit under the program and if so, the
amount of the cash benefit (in accordance the
sliding scale established under the plan).
[``(C) Presumptive eligibility for certain
institutionalized enrollees planning to
discharge.--An active enrollee shall be deemed
presumptively eligible if the enrollee--
[``(i) has applied for, and attests
is eligible for, the maximum cash
benefit available under the sliding
scale established under the CLASS
Independence Benefit Plan;
[``(ii) is a patient in a hospital
(but only if the hospitalization is for
long-term care), nursing facility,
intermediate care facility for the
mentally retarded, or an institution
for mental diseases; and
[``(iii) is in the process of, or
about to begin the process of, planning
to discharge from the hospital,
facility, or institution, or within 60
days from the date of discharge from
the hospital, facility, or institution.
[``(D) Appeals.--The Secretary shall
establish procedures under which an applicant
for benefits under the CLASS Independence
Benefit Plan shall be guaranteed the right to
appeal an adverse determination.
[``(b) Benefits.--An eligible beneficiary shall receive the
following benefits under the CLASS Independence Benefit Plan:
[``(1) Cash benefit.--A cash benefit established by
the Secretary in accordance with the requirements of
section 3203(a)(1)(D) that--
[``(A) the first year in which beneficiaries
receive the benefits under the plan, is not
less than the average dollar amount specified
in clause (i) of such section; and
[``(B) for any subsequent year, is not less
than the average per day dollar limit
applicable under this subparagraph for the
preceding year, increased by the percentage
increase in the consumer price index for all
urban consumers (U.S. city average) over the
previous year.
[``(2) Advocacy services.--Advocacy services in
accordance with subsection (d).
[``(3) Advice and assistance counseling.--Advice and
assistance counseling in accordance with subsection
(e).
[``(4) Administrative expenses.--Advocacy services
and advise and assistance counseling services under
paragraphs (2) and (3) of this subsection shall be
included as administrative expenses under section
3203(b)(3).
[``(c) Payment of Benefits.--
[``(1) Life independence account.--
[``(A) In general.--The Secretary shall
establish procedures for administering the
provision of benefits to eligible beneficiaries
under the CLASS Independence Benefit Plan,
including the payment of the cash benefit for
the beneficiary into a Life Independence
Account established by the Secretary on behalf
of each eligible beneficiary.
[``(B) Use of cash benefits.--Cash benefits
paid into a Life Independence Account of an
eligible beneficiary shall be used to purchase
nonmedical services and supports that the
beneficiary needs to maintain his or her
independence at home or in another residential
setting of their choice in the community,
including (but not limited to) home
modifications, assistive technology, accessible
transportation, homemaker services, respite
care, personal assistance services, home care
aides, and nursing support. Nothing in the
preceding sentence shall prevent an eligible
beneficiary from using cash benefits paid into
a Life Independence Account for obtaining
assistance with decision making concerning
medical care, including the right to accept or
refuse medical or surgical treatment and the
right to formulate advance directives or other
written instructions recognized under State
law, such as a living will or durable power of
attorney for health care, in the case that an
injury or illness causes the individual to be
unable to make health care decisions.
[``(C) Electronic management of funds.--The
Secretary shall establish procedures for--
[``(i) crediting an account
established on behalf of a beneficiary
with the beneficiary's cash daily
benefit;
[``(ii) allowing the beneficiary to
access such account through debit
cards; and
[``(iii) accounting for withdrawals
by the beneficiary from such account.
[``(D) Primary payor rules for beneficiaries
who are enrolled in medicaid.--In the case of
an eligible beneficiary who is enrolled in
Medicaid, the following payment rules shall
apply:
[``(i) Institutionalized
beneficiary.--If the beneficiary is a
patient in a hospital, nursing
facility, intermediate care facility
for the mentally retarded, or an
institution for mental diseases, the
beneficiary shall retain an amount
equal to 5 percent of the beneficiary's
daily or weekly cash benefit (as
applicable) (which shall be in addition
to the amount of the beneficiary's
personal needs allowance provided under
Medicaid), and the remainder of such
benefit shall be applied toward the
facility's cost of providing the
beneficiary's care, and Medicaid shall
provide secondary coverage for such
care.
[``(ii) Beneficiaries receiving home
and community-based services.--
[``(I) 50 percent of benefit
retained by beneficiary.--
Subject to subclause (II), if a
beneficiary is receiving
medical assistance under
Medicaid for home and community
based services, the beneficiary
shall retain an amount equal to
50 percent of the beneficiary's
daily or weekly cash benefit
(as applicable), and the
remainder of the daily or
weekly cash benefit shall be
applied toward the cost to the
State of providing such
assistance (and shall not be
used to claim Federal matching
funds under Medicaid), and
Medicaid shall provide
secondary coverage for the
remainder of any costs incurred
in providing such assistance.
[``(II) Requirement for state
offset.--A State shall be paid
the remainder of a
beneficiary's daily or weekly
cash benefit under subclause
(I) only if the State home and
community-based waiver under
section 1115 of the Social
Security Act (42 U.S.C. 1315)
or subsection (c) or (d) of
section 1915 of such Act (42
U.S.C. 1396n), or the State
plan amendment under subsection
(i) of such section does not
include a waiver of the
requirements of section
1902(a)(1) of the Social
Security Act (relating to
statewideness) or of section
1902(a)(10)(B) of such Act
(relating to comparability) and
the State offers at a minimum
case management services,
personal care services,
habilitation services, and
respite care under such a
waiver or State plan amendment.
[``(III) Definition of home
and community-based services.--
In this clause, the term `home
and community-based services'
means any services which may be
offered under a home and
community-based waiver
authorized for a State under
section 1115 of the Social
Security Act (42 U.S.C. 1315)
or subsection (c) or (d) of
section 1915 of such Act (42
U.S.C. 1396n) or under a State
plan amendment under subsection
(i) of such section.
[``(iii) Beneficiaries enrolled in
programs of all-inclusive care for the
elderly (pace).--
[``(I) In general.--Subject
to subclause (II), if a
beneficiary is receiving
medical assistance under
Medicaid for PACE program
services under section 1934 of
the Social Security Act (42
U.S.C. 1396u-4), the
beneficiary shall retain an
amount equal to 50 percent of
the beneficiary's daily or
weekly cash benefit (as
applicable), and the remainder
of the daily or weekly cash
benefit shall be applied toward
the cost to the State of
providing such assistance (and
shall not be used to claim
Federal matching funds under
Medicaid), and Medicaid shall
provide secondary coverage for
the remainder of any costs
incurred in providing such
assistance.
[``(II) Institutionalized
recipients of pace program
services.--If a beneficiary
receiving assistance under
Medicaid for PACE program
services is a patient in a
hospital, nursing facility,
intermediate care facility for
the mentally retarded, or an
institution for mental
diseases, the beneficiary shall
be treated as in
institutionalized beneficiary
under clause (i).
[``(2) Authorized representatives.--
[``(A) In general.--The Secretary shall
establish procedures to allow access to a
beneficiary's cash benefits by an authorized
representative of the eligible beneficiary on
whose behalf such benefits are paid.
[``(B) Quality assurance and protection
against fraud and abuse.--The procedures
established under subparagraph (A) shall ensure
that authorized representatives of eligible
beneficiaries comply with standards of conduct
established by the Secretary, including
standards requiring that such representatives
provide quality services on behalf of such
beneficiaries, do not have conflicts of
interest, and do not misuse benefits paid on
behalf of such beneficiaries or otherwise
engage in fraud or abuse.
[``(3) Commencement of benefits.--Benefits shall be
paid to, or on behalf of, an eligible beneficiary
beginning with the first month in which an application
for such benefits is approved.
[``(4) Rollover option for lump-sum payment.--An
eligible beneficiary may elect to--
[``(A) defer payment of their daily or weekly
benefit and to rollover any such deferred
benefits from month-to-month, but not from
year-to-year; and
[``(B) receive a lump-sum payment of such
deferred benefits in an amount that may not
exceed the lesser of--
[``(i) the total amount of the
accrued deferred benefits; or
[``(ii) the applicable annual
benefit.
[``(5) Period for determination of annual benefits.--
[``(A) In general.--The applicable period for
determining with respect to an eligible
beneficiary the applicable annual benefit and
the amount of any accrued deferred benefits is
the 12-month period that commences with the
first month in which the beneficiary began to
receive such benefits, and each 12-month period
thereafter.
[``(B) Inclusion of increased benefits.--The
Secretary shall establish procedures under
which cash benefits paid to an eligible
beneficiary that increase or decrease as a
result of a change in the functional status of
the beneficiary before the end of a 12-month
benefit period shall be included in the
determination of the applicable annual benefit
paid to the eligible beneficiary.
[``(C) Recoupment of unpaid, accrued
benefits.--
[``(i) In general.--The Secretary, in
coordination with the Secretary of the
Treasury, shall recoup any accrued
benefits in the event of--
[``(I) the death of a
beneficiary; or
[``(II) the failure of a
beneficiary to elect under
paragraph (4)(B) to receive
such benefits as a lump-sum
payment before the end of the
12-month period in which such
benefits accrued.
[``(ii) Payment into class
independence fund.--Any benefits
recouped in accordance with clause (i)
shall be paid into the CLASS
Independence Fund and used in
accordance with section 3206.
[``(6) Requirement to recertify eligibility for
receipt of benefits.--An eligible beneficiary shall
periodically, as determined by the Secretary--
[``(A) recertify by submission of medical
evidence the beneficiary's continued
eligibility for receipt of benefits; and
[``(B) submit records of expenditures
attributable to the aggregate cash benefit
received by the beneficiary during the
preceding year.
[``(7) Supplement, not supplant other health care
benefits.--Subject to the Medicaid payment rules under
paragraph (1)(D), benefits received by an eligible
beneficiary shall supplement, but not supplant, other
health care benefits for which the beneficiary is
eligible under Medicaid or any other Federally funded
program that provides health care benefits or
assistance.
[``(d) Advocacy services.--An agreement entered into under
subsection (a)(2)(A)(ii) shall require the Protection and
Advocacy System for the State to--
[``(1) assign, as needed, an advocacy counselor to
each eligible beneficiary that is covered by such
agreement and who shall provide an eligible beneficiary
with--
[``(A) information regarding how to access
the appeals process established for the
program;
[``(B) assistance with respect to the annual
recertification and notification required under
subsection (c)(6); and
[``(C) such other assistance with obtaining
services as the Secretary, by regulation, shall
require; and
[``(2) ensure that the System and such counselors
comply with the requirements of subsection (h).
[``(e) Advice and Assistance Counseling.--An agreement
entered into under subsection (a)(2)(A)(iii) shall require the
entity to assign, as requested by an eligible beneficiary that
is covered by such agreement, an advice and assistance
counselor who shall provide an eligible beneficiary with
information regarding--
[``(1) accessing and coordinating long-term services
and supports in the most integrated setting;
[``(2) possible eligibility for other benefits and
services;
[``(3) development of a service and support plan;
[``(4) information about programs established under
the Assistive Technology Act of 1998 and the services
offered under such programs;
[``(5) available assistance with decision making
concerning medical care, including the right to accept
or refuse medical or surgical treatment and the right
to formulate advance directives or other written
instructions recognized under State law, such as a
living will or durable power of attorney for health
care, in the case that an injury or illness causes the
individual to be unable to make health care decisions;
and
[``(6) such other services as the Secretary, by
regulation, may require.
[``(f) No Effect on Eligibility for Other Benefits.--Benefits
paid to an eligible beneficiary under the CLASS program shall
be disregarded for purposes of determining or continuing the
beneficiary's eligibility for receipt of benefits under any
other Federal, State, or locally funded assistance program,
including benefits paid under titles II, XVI, XVIII, XIX, or
XXI of the Social Security Act (42 U.S.C. 401 et seq., 1381 et
seq., 1395 et seq., 1396 et seq., 1397aa et seq.), under the
laws administered by the Secretary of Veterans Affairs, under
low-income housing assistance programs, or under the
supplemental nutrition assistance program established under the
Food and Nutrition Act of 2008 (7 U.S.C. 2011 et seq.).
[``(g) Rule of Construction.--Nothing in this title shall be
construed as prohibiting benefits paid under the CLASS
Independence Benefit Plan from being used to compensate a
family caregiver for providing community living assistance
services and supports to an eligible beneficiary.
[``(h) Protection Against Conflict of Interests.--The
Secretary shall establish procedures to ensure that the
Eligibility Assessment System, the Protection and Advocacy
System for a State, advocacy counselors for eligible
beneficiaries, and any other entities that provide services to
active enrollees and eligible beneficiaries under the CLASS
program comply with the following:
[``(1) If the entity provides counseling or planning
services, such services are provided in a manner that
fosters the best interests of the active enrollee or
beneficiary.
[``(2) The entity has established operating
procedures that are designed to avoid or minimize
conflicts of interest between the entity and an active
enrollee or beneficiary.
[``(3) The entity provides information about all
services and options available to the active enrollee
or beneficiary, to the best of its knowledge, including
services available through other entities or providers.
[``(4) The entity assists the active enrollee or
beneficiary to access desired services, regardless of
the provider.
[``(5) The entity reports the number of active
enrollees and beneficiaries provided with assistance by
age, disability, and whether such enrollees and
beneficiaries received services from the entity or
another entity.
[``(6) If the entity provides counseling or planning
services, the entity ensures that an active enrollee or
beneficiary is informed of any financial interest that
the entity has in a service provider.
[``(7) The entity provides an active enrollee or
beneficiary with a list of available service providers
that can meet the needs of the active enrollee or
beneficiary.
[``SEC. 3206. CLASS INDEPENDENCE FUND.
[``(a) Establishment of CLASS Independence Fund.--There is
established in the Treasury of the United States a trust fund
to be known as the `CLASS Independence Fund'. The Secretary of
the Treasury shall serve as Managing Trustee of such Fund. The
Fund shall consist of all amounts derived from payments into
the Fund under sections 3204(f) and 3205(c)(5)(C)(ii), and
remaining after investment of such amounts under subsection
(b), including additional amounts derived as income from such
investments. The amounts held in the Fund are appropriated and
shall remain available without fiscal year limitation--
[``(1) to be held for investment on behalf of
individuals enrolled in the CLASS program;
[``(2) to pay the administrative expenses related to
the Fund and to investment under subsection (b); and
[``(3) to pay cash benefits to eligible beneficiaries
under the CLASS Independence Benefit Plan.
[``(b) Investment of Fund Balance.--The Secretary of the
Treasury shall invest and manage the CLASS Independence Fund in
the same manner, and to the same extent, as the Federal
Supplementary Medical Insurance Trust Fund may be invested and
managed under subsections (c), (d), and (e) of section 1841(d)
of the Social Security Act (42 U.S.C. 1395t).
[``(c) Board of Trustees.--
[``(1) In general.--With respect to the CLASS
Independence Fund, there is hereby created a body to be
known as the Board of Trustees of the CLASS
Independence Fund (hereinafter in this section referred
to as the `Board of Trustees') composed of the
Secretary of the Treasury, the Secretary of Labor, and
the Secretary of Health and Human Services, all ex
officio, and of two members of the public (both of whom
may not be from the same political party), who shall be
nominated by the President for a term of 4 years and
subject to confirmation by the Senate. A member of the
Board of Trustees serving as a member of the public and
nominated and confirmed to fill a vacancy occurring
during a term shall be nominated and confirmed only for
the remainder of such term. An individual nominated and
confirmed as a member of the public may serve in such
position after the expiration of such member's term
until the earlier of the time at which the member's
successor takes office or the time at which a report of
the Board is first issued under paragraph (2) after the
expiration of the member's term. The Secretary of the
Treasury shall be the Managing Trustee of the Board of
Trustees. The Board of Trustees shall meet not less
frequently than once each calendar year. A person
serving on the Board of Trustees shall not be
considered to be a fiduciary and shall not be
personally liable for actions taken in such capacity
with respect to the Trust Fund.
[``(2) Duties.--
[``(A) In general.--It shall be the duty of
the Board of Trustees to do the following:
[``(i) Hold the CLASS Independence
Fund.
[``(ii) Report to the Congress not
later than the first day of April of
each year on the operation and status
of the CLASS Independence Fund during
the preceding fiscal year and on its
expected operation and status during
the current fiscal year and the next 2
fiscal years.
[``(iii) Report immediately to the
Congress whenever the Board is of the
opinion that the amount of the CLASS
Independence Fund is not actuarially
sound in regards to the projection
under section 3203(b)(1)(B)(i).
[``(iv) Review the general policies
followed in managing the CLASS
Independence Fund, and recommend
changes in such policies, including
necessary changes in the provisions of
law which govern the way in which the
CLASS Independence Fund is to be
managed.
[``(B) Report.--The report provided for in
subparagraph (A)(ii) shall--
[``(i) include--
[``(I) a statement of the
assets of, and the
disbursements made from, the
CLASS Independence Fund during
the preceding fiscal year;
[``(II) an estimate of the
expected income to, and
disbursements to be made from,
the CLASS Independence Fund
during the current fiscal year
and each of the next 2 fiscal
years;
[``(III) a statement of the
actuarial status of the CLASS
Independence Fund for the
current fiscal year, each of
the next 2 fiscal years, and as
projected over the 75-year
period beginning with the
current fiscal year; and
[``(IV) an actuarial opinion
by the Chief Actuary of the
Centers for Medicare & Medicaid
Services certifying that the
techniques and methodologies
used are generally accepted
within the actuarial profession
and that the assumptions and
cost estimates used are
reasonable; and
[``(ii) be printed as a House
document of the session of the Congress
to which the report is made.
[``(C) Recommendations.--If the Board of
Trustees determines that enrollment trends and
expected future benefit claims on the CLASS
Independence Fund are not actuarially sound in
regards to the projection under section
3203(b)(1)(B)(i) and are unlikely to be
resolved with reasonable premium increases or
through other means, the Board of Trustees
shall include in the report provided for in
subparagraph (A)(ii) recommendations for such
legislative action as the Board of Trustees
determine to be appropriate, including whether
to adjust monthly premiums or impose a
temporary moratorium on new enrollments.
[``SEC. 3207. CLASS INDEPENDENCE ADVISORY COUNCIL.
[``(a) Establishment.--There is hereby created an Advisory
Committee to be known as the `CLASS Independence Advisory
Council'.
[``(b) Membership.--
[``(1) In general.--The CLASS Independence Advisory
Council shall be composed of not more than 15
individuals, not otherwise in the employ of the United
States--
[``(A) who shall be appointed by the
President without regard to the civil service
laws and regulations; and
[``(B) a majority of whom shall be
representatives of individuals who participate
or are likely to participate in the CLASS
program, and shall include representatives of
older and younger workers, individuals with
disabilities, family caregivers of individuals
who require services and supports to maintain
their independence at home or in another
residential setting of their choice in the
community, individuals with expertise in long-
term care or disability insurance, actuarial
science, economics, and other relevant
disciplines, as determined by the Secretary.
[``(2) Terms.--
[``(A) In general.--The members of the CLASS
Independence Advisory Council shall serve
overlapping terms of 3 years (unless appointed
to fill a vacancy occurring prior to the
expiration of a term, in which case the
individual shall serve for the remainder of the
term).
[``(B) Limitation.--A member shall not be
eligible to serve for more than 2 consecutive
terms.
[``(3) Chair.--The President shall, from time to
time, appoint one of the members of the CLASS
Independence Advisory Council to serve as the Chair.
[``(c) Duties.--The CLASS Independence Advisory Council shall
advise the Secretary on matters of general policy in the
administration of the CLASS program established under this
title and in the formulation of regulations under this title
including with respect to--
[``(1) the development of the CLASS Independence
Benefit Plan under section 3203;
[``(2) the determination of monthly premiums under
such plan; and
[``(3) the financial solvency of the program.
[``(d) Application of FACA.--The Federal Advisory Committee
Act (5 U.S.C. App.), other than section 14 of that Act, shall
apply to the CLASS Independence Advisory Council.
[``(e) Authorization of Appropriations.--
[``(1) In general.--There are authorized to be
appropriated to the CLASS Independence Advisory Council
to carry out its duties under this section, such sums
as may be necessary for fiscal year 2011 and for each
fiscal year thereafter.
[``(2) Availability.--Any sums appropriated under the
authorization contained in this section shall remain
available, without fiscal year limitation, until
expended.
[``SEC. 3208. SOLVENCY AND FISCAL INDEPENDENCE; REGULATIONS; ANNUAL
REPORT.
[``(a) Solvency.--The Secretary shall regularly consult with
the Board of Trustees of the CLASS Independence Fund and the
CLASS Independence Advisory Council, for purposes of ensuring
that enrollees premiums are adequate to ensure the financial
solvency of the CLASS program, both with respect to fiscal
years occurring in the near-term and fiscal years occurring
over 20- and 75-year periods, taking into account the
projections required for such periods under subsections
(a)(1)(A)(i) and (b)(1)(B)(i) of section 3202.
[``(b) No Taxpayer Funds Used To Pay Benefits.--No taxpayer
funds shall be used for payment of benefits under a CLASS
Independent Benefit Plan. For purposes of this subsection, the
term `taxpayer funds' means any Federal funds from a source
other than premiums deposited by CLASS program participants in
the CLASS Independence Fund and any associated interest
earnings.
[``(c) Regulations.--The Secretary shall promulgate such
regulations as are necessary to carry out the CLASS program in
accordance with this title. Such regulations shall include
provisions to prevent fraud and abuse under the program.
[``(d) Annual Report.--Beginning January 1, 2014, the
Secretary shall submit an annual report to Congress on the
CLASS program. Each report shall include the following:
[``(1) The total number of enrollees in the program.
[``(2) The total number of eligible beneficiaries
during the fiscal year.
[``(3) The total amount of cash benefits provided
during the fiscal year.
[``(4) A description of instances of fraud or abuse
identified during the fiscal year.
[``(5) Recommendations for such administrative or
legislative action as the Secretary determines is
necessary to improve the program, ensure the solvency
of the program, or to prevent the occurrence of fraud
or abuse.
[``SEC. 3209. INSPECTOR GENERAL'S REPORT.
[The Inspector General of the Department of Health and Human
Services shall submit an annual report to the Secretary and
Congress relating to the overall progress of the CLASS program
and of the existence of waste, fraud, and abuse in the CLASS
program. Each such report shall include findings in the
following areas:
[``(1) The eligibility determination process.
[``(2) The provision of cash benefits.
[``(3) Quality assurance and protection against
waste, fraud, and abuse.
[``(4) Recouping of unpaid and accrued benefits.
[``SEC. 3210. TAX TREATMENT OF PROGRAM.
[``The CLASS program shall be treated for purposes of the
Internal Revenue Code of 1986 in the same manner as a qualified
long-term care insurance contract for qualified long-term care
services.''.
[(2) Conforming amendments to medicaid.--Section
1902(a) of the Social Security Act (42 U.S.C.
1396a(a)), as amended by section 6505, is amended by
inserting after paragraph (80) the following:
[``(81) provide that the State will comply with such
regulations regarding the application of primary and
secondary payor rules with respect to individuals who
are eligible for medical assistance under this title
and are eligible beneficiaries under the CLASS program
established under title XXXII of the Public Health
Service Act as the Secretary shall establish; and''.
[(b) Assurance of Adequate Infrastructure for the Provision
of Personal Care Attendant Workers.--Section 1902(a) of the
Social Security Act (42 U.S.C. 1396a(a)), as amended by
subsection (a)(2), is amended by inserting after paragraph (81)
the following:
[``(82) provide that, not later than 2 years after
the date of enactment of the Community Living
Assistance Services and Supports Act, each State
shall--
[``(A) assess the extent to which entities
such as providers of home care, home health
services, home and community service providers,
public authorities created to provide personal
care services to individuals eligible for
medical assistance under the State plan, and
nonprofit organizations, are serving or have
the capacity to serve as fiscal agents for,
employers of, and providers of employment-
related benefits for, personal care attendant
workers who provide personal care services to
individuals receiving benefits under the CLASS
program established under title XXXII of the
Public Health Service Act, including in rural
and underserved areas;
[``(B) designate or create such entities to
serve as fiscal agents for, employers of, and
providers of employment-related benefits for,
such workers to ensure an adequate supply of
the workers for individuals receiving benefits
under the CLASS program, including in rural and
underserved areas; and
[``(C) ensure that the designation or
creation of such entities will not negatively
alter or impede existing programs, models,
methods, or administration of service delivery
that provide for consumer controlled or self-
directed home and community services and
further ensure that such entities will not
impede the ability of individuals to direct and
control their home and community services,
including the ability to select, manage,
dismiss, co-employ, or employ such workers or
inhibit such individuals from relying on family
members for the provision of personal care
services.''.
[(c) Personal Care Attendants Workforce Advisory Panel.--
[(1) Establishment.--Not later than 90 days after the
date of enactment of this Act, the Secretary of Health
and Human Services shall establish a Personal Care
Attendants Workforce Advisory Panel for the purpose of
examining and advising the Secretary and Congress on
workforce issues related to personal care attendant
workers, including with respect to the adequacy of the
number of such workers, the salaries, wages, and
benefits of such workers, and access to the services
provided by such workers.
[(2) Membership.--In appointing members to the
Personal Care Attendants Workforce Advisory Panel, the
Secretary shall ensure that such members include the
following:
[(A) Individuals with disabilities of all
ages.
[(B) Senior individuals.
[(C) Representatives of individuals with
disabilities.
[(D) Representatives of senior individuals.
[(E) Representatives of workforce and labor
organizations.
[(F) Representatives of home and community-
based service providers.
[(G) Representatives of assisted living
providers.
[(d) Inclusion of CLASS Program Information in the National
Clearinghouse for Long-Term Care Information; Extension of
Funding.--Section 6021(d) of the Deficit Reduction Act of 2005
(42 U.S.C. 1396p note) is amended--
[(1) in paragraph (2)(A)--
[(A) in clause (ii), by striking ``and'' at
the end;
[(B) in clause (iii), by striking the period
at the end and inserting ``; and''; and
[(C) by adding at the end the following:
[``(iv) include information regarding
the CLASS program established under
title XXXII of the Public Health
Service Act and information regarding
how benefits provided under a CLASS
Independence Benefit Plan differ from
disability insurance benefits.''; and
[(2) in paragraph (3), by striking ``2010'' and
inserting ``2015''.
[(e) Effective Date.--The amendments made by subsections (a),
(b), and (d) take effect on January 1, 2011.
[(f) Rule of Construction.--Nothing in this title or the
amendments made by this title are intended to replace or
displace public or private disability insurance benefits,
including such benefits that are for income replacement.]
* * * * * * *
----------
SOCIAL SECURITY ACT
* * * * * * *
TITLE XIX--GRANTS TO STATES FOR MEDICAL ASSISTANCE PROGRAMS
* * * * * * *
STATE PLANS FOR MEDICAL ASSISTANCE
Sec. 1902. (a) A State plan for medical assistance must--
(1) * * *
* * * * * * *
(80) provide that the State shall not provide any
payments for items or services provided under the State
plan or under a waiver to any financial institution or
entity located outside of the United States; and
[(81) provide that the State will comply with such
regulations regarding the application of primary and
secondary payor rules with respect to individuals who
are eligible for medical assistance under this title
and are eligible beneficiaries under the CLASS program
established under title XXXII of the Public Health
Service Act as the Secretary shall establish;
[(82) provide that, not later than 2 years after the
date of enactment of the Community Living Assistance
Services and Supports Act, each State shall--
[(A) assess the extent to which entities such
as providers of home care, home health
services, home and community service providers,
public authorities created to provide personal
care services to individuals eligible for
medical assistance under the State plan, and
nonprofit organizations, are serving or have
the capacity to serve as fiscal agents for,
employers of, and providers of employment-
related benefits for, personal care attendant
workers who provide personal care services to
individuals receiving benefits under the CLASS
program established under title XXXII of the
Public Health Service Act, including in rural
and underserved areas;
[(B) designate or create such entities to
serve as fiscal agents for, employers of, and
providers of employment-related benefits for,
such workers to ensure an adequate supply of
the workers for individuals receiving benefits
under the CLASS program, including in rural and
underserved areas; and
[(C) ensure that the designation or creation
of such entities will not negatively alter or
impede existing programs, models, methods, or
administration of service delivery that provide
for consumer controlled or self-directed home
and community services and further ensure that
such entities will not impede the ability of
individuals to direct and control their home
and community services, including the ability
to select, manage, dismiss, co-employ, or
employ such workers or inhibit such individuals
from relying on family members for the
provision of personal care services; and]
[(83)] (81) provide for implementation of the payment
models specified by the Secretary under section
1115A(c) for implementation on a nationwide basis
unless the State demonstrates to the satisfaction of
the Secretary that implementation would not be
administratively feasible or appropriate to the health
care delivery system of the State.
* * * * * * *
----------
DEFICIT REDUCTION ACT OF 2005
* * * * * * *
TITLE VI--MEDICAID AND SCHIP
Subtitle A--Medicaid
* * * * * * *
CHAPTER 2--LONG-TERM CARE UNDER MEDICAID
* * * * * * *
Subchapter B--Expanded Access to Certain Benefits
SEC. 6021. EXPANSION OF STATE LONG-TERM CARE PARTNERSHIP PROGRAM.
(a) * * *
* * * * * * *
(d) National Clearinghouse for Long-Term Care Information.--
(1) * * *
(2) Duties.--
(A) In general.--The National Clearinghouse
for Long-Term Care Information shall--
(i) * * *
* * * * * * *
(iv) not include information
regarding the CLASS program established
under title XXXII of the Public Health
Service Act [and] or information
regarding how benefits provided under a
CLASS Independence Benefit Plan differ
from disability insurance benefits.
* * * * * * *
(3) [Appropriation] Funding.--Out of any funds in the
Treasury not otherwise appropriated, there is
appropriated to carry out this subsection, $3,000,000
for each of fiscal years 2006 through [2015] 2012.
There is authorized to be appropriated to carry out
this subsection $3,000,000 for each of fiscal years
2013 through 2015.
* * * * * * *
DISSENTING VIEWS
We, the undersigned members of the Committee on Energy and
Commerce, oppose the passage of H.R. 1173, the Fiscal
Responsibility and Retirement Security Act of 2011, a bill to
repeal Title XXXII of the Public Health Service Act (relating
to the Community Living Assistance Services and Supports
Program, generally known as the CLASS Program) as well as other
provisions included in Title VIII of the Affordable Care Act
(relating to the National Clearinghouse for Long-Term Care
Information and the Personal Care Attendants Workforce Advisory
Panel). Accordingly, we submit the following comments to
express our concerns about this ill-conceived and ill-advised
legislation.
Introduction
Committee Democrats and Republicans alike agree: The United
States is facing a long-term care crisis that demands our
immediate and full attention\1\--a crisis that will only grow
worse as the nation's baby boomers begin to age.\2\
---------------------------------------------------------------------------
\1\See the comments of various Committee members during the
hearings and markups on CLASS and H.R. 1173 in which they recognize the
enormity of the U.S. long-term care problem:
From the July 2009 full Committee markup on H.R. 3200, America's
Affordable Health Choices Act of 2009 (the House of Representatives'
precursor legislation to the Affordable Care Act) (House Committee on
Energy and Commerce, Markup on H.R. 3200, America's Affordable Health
Choices Act of 2009, 111th Cong. (July 17 and 20, 2009) (transcript of
the proceeding)):
L``[T]his is [a] major issue. . . .'' (Rep. Frank Pallone,
p. 17) (July 17, 2009)
LIt [long-term care] is definitely something we need to
do.'' (Rep. Joe Barton, p. 269) (July 20, 2009)
From the March 2011 Health Subcommittee hearing on the
implementation of CLASS (Subcommittee on Health, House Committee on
Energy and Commerce, Hearing on the Implementation and Sustainability
of the New Government-Administered Community Living Assistance Services
and Supports (CLASS) Program, 112th Cong. (Mar. 17, 2011) (transcript
of the proceeding)):
L``[W]e can all agree that do have a serious long-term
care problem in this country. . . .'' (Rep. Joe Pitts, p. 4)
L ``We all know the problem exists.'' (Rep. Michael
Burgess, p. 6)
L ``The [long-term care] problem has been with us for a
long time, and it is growing.'' (Rep. Henry Waxman, p. 20)
L``[W]hat is the best thing for us . . . to serve a
terrifying unmet need for all of our people.'' (Rep. John Dingell, p.
23)
From the October 2011 joint Oversight and Investigations
Subcommittee and Health Subcommittee hearing on the financial
sustainability of CLASS (Subcommittee on Oversight and Investigations
and Subcommittee on Health, House Committee on Energy and Commerce,
Joint Hearing on Class Cancelled: An Unsustainable Program and Its
Consequences for the Nation's Deficit, 112th Cong. (Oct. 26, 2011)
(transcript of the proceeding)):
L``[W]e have got to keep looking for solutions to the
long-term problem, and we have got to do it in a bi-partisan way.''
(Rep. Diana DeGette, p. 15)
L``Really the question . . . everybody agrees we need to
come up with a solution for the problem of long-term care. I don't
think any of us argue that.'' (Rep. Bill Cassidy, p. 122)
From the November 2011 Health Subcommittee markup on H.R. 1173
(Subcommittee on Health, House Committee on Energy and Commerce, Markup
on H.R. 1173, the Fiscal Responsibility and Retirement Security Act of
2011, 112th Cong. (Nov. 15, 2011) (transcript of the proceeding):
L``[L]ong-term care reform, [is] an issue that is
important to all of us as we hear from constituents regularly about the
growing cost of long-term care services.'' (Rep. Fred Upton, pp. 19-20)
L``[T]he issue of long-term care as a critical hole in our
health care system is agreed upon by both sides of this committee.
(Rep. Lois Capps, p. 26)
From the November 2011 full Committee markup on H.R. 1173 (House
Committee on Energy and Commerce, Markup on H.R. 1173, the Fiscal
Responsibility and Retirement Security Act of 2011, 112th Cong. (Nov.
30, 2011) (transcript of the proceeding):
L``I was impressed by the level of bipartisan support for
finding an affordable and sustainable solution to this [long-term care]
problem.'' (Rep. Ed Towns, p. 223)
L``[Y]ou [Committee Democrats] are right. There is a huge
need to address long-term care.'' (Rep. John Shimkus, p. 226)
\2\United States Census Bureau, The Older Population in the United
States: 2010 to 2050 (May 2010) (online at http://www.census.gov/prod/
2010pubs/p25-1138.pdf).
---------------------------------------------------------------------------
In response to this concern, Congress established the
Community Living Assistance Services and Supports Program--or
CLASS--as part of the Affordable Care Act (ACA)\3\ in 2010.
CLASS represents the federal government's first and to date,
only major--albeit limited--attempt to begin to address our
pressing long-term care problem. Its purpose is clear: To
provide a national, voluntary, and self-sustaining insurance
program for the purchase of assistance services and supports to
aid functionally impaired elderly and disabled people. Its
goal--to allow these individuals to live independently at home
and in the community for as long as possible without
impoverishing themselves--is warmly embraced by both
parties.\4\ Nonetheless, the Program's implementation has been
anything but straightforward or uniformly supported; indeed, we
readily acknowledge that CLASS has not yet been formerly
launched and is now wholly opposed by our Republicans
colleagues.\5\
---------------------------------------------------------------------------
\3\The ACA is comprised of two public laws, P.L. 111-148 and P.L.
111-152.
\4\See, e.g., remarks of Rep. Joe Pitts (House Committee on Energy
and Commerce, Markup on H.R. 1173, the Fiscal Responsibility and
Retirement Security Act of 2011, 112th Cong., p. 24 (Nov. 29, 2011)
(transcript of the proceeding)); Rep. Henry Waxman (Subcommittee on
Health, House Committee on Energy and Commerce, Markup on H.R. 1173,
the Fiscal Responsibility and Retirement Security Act of 2011, 112th
Cong., p. 15 (Nov. 15, 2011) (transcript of the proceeding)); Rep.
Frank Pallone (Subcommittee on Health, House Committee on Energy and
Commerce, Hearing on the Implementation and Sustainability of the New
Government-Administered Community Living Assistance Services and
Supports (CLASS) Program, 112th Cong., p. 9 (Mar. 17, 2011) (transcript
of the proceeding)); Rep. Phil Gingrey (Subcommittee on Health, House
Committee on Energy and Commerce, Hearing on the Implementation and
Sustainability of the New Government-Administered Community Living
Assistance Services and Supports (CLASS) Program, 112th Cong., p. 16;
(Mar. 17, 2011) (transcript of the proceeding)); and Rep. Lee Terry
(House Committee on Energy and Commerce, Markup on H.R. 3200, America's
Affordable Health Choices Act of 2009, 111th Cong., p. 290 (July 20,
2009) (transcript of the proceeding)).
\5\CLASS was adopted--on a bipartisan voice vote--as an amendment
to H.R. 3200, America's Affordable Health Choices Act of 2009, during
the Committee's mark up of that legislation. H.R. 3200 was the House of
Representatives' precursor legislation to the ACA (House Committee on
Energy and Commerce, Markup on H.R. 3200, America's Affordable Health
Choices Act of 2009, 111th Cong., p. 293 (July 20, 2009) (transcript of
the proceeding)). Now, however, Republicans are united in their
opposition to the Program (House Committee on Energy and Commerce,
Markup on H.R. 1173, the Fiscal Responsibility and Retirement Security
Act of 2011, 112th Cong., pp. 259-266 (Nov. 30, 2011) (transcript of
the proceeding)).
---------------------------------------------------------------------------
In its October 2011 report, A Report on the Actuarial,
Marketing, and Legal Analyses of the CLASS Program, the
Department of Health and Human Services (HHS) lays out the
various reasons behind its decision not to move forward with
the implementation of CLASS at this time.\6\ While
disappointing, in light of the issues raised, we believe the
Department has acted responsibly. But neither HHS\7\ nor we
believe that the appropriate response to the Report is a
wholesale dismantling of CLASS. Most importantly, despite the
setbacks, the people for whom CLASS was enacted do not think
this is the right approach either.\8\ Yet, this is precisely
what H.R. 1173 sets out to do--rather than take on the
Program's flaws identified in the Report, the bill would repeal
CLASS altogether. At the same time and consistent with the
Republican mantra ``just say no'' to all ACA-related programs,
the legislation fails to put forward an alternative solution to
the very problem its supporters claim they want to fix.
---------------------------------------------------------------------------
\6\Department of Health and Human Services, A Report on the
Actuarial, Marketing, and Legal Analyses of the CLASS Program (Oct.
2011) (online at http://aspe.hhs.gov/daltcp/reports/2011/class/
index.shtml).
\7\``We [HHS] feel that repealing CLASS would serve no useful
purpose at this point.'' (Testimony of Kathy Greenlee, HHS Assistant
Secretary for Aging, Subcommittee on Oversight and Investigations and
Subcommittee on Health, House Committee on Energy and Commerce, Joint
Hearing on Class Cancelled: An Unsustainable Program and Its
Consequences for the Nation's Deficit, 112th Cong., p. 102 (Oct. 26,
2011) (transcript of the proceeding)).
\8\Letter from 56 organizations in opposition to H.R. 1173 to Reps.
Fred Upton, Chair, Committee on Energy and Commerce; Rep. Henry Waxman,
Ranking Member, Committee on Energy and Commerce; Rep. Joe Pitts,
Chair, Subcommittee on Health, Committee on Energy and Commerce; and
Rep. Frank Pallone, Ranking Member, Subcommittee on Health, Committee
on Energy and Commerce (Nov. 14, 2011).
---------------------------------------------------------------------------
In our view, H.R. 1173 is precisely the wrong way to go.
While a ``timeout'' for CLASS may be fitting at this juncture
in the Program's brief history, ``throwing in the towel''
completely simply is not the answer. HHS and Congress should
instead learn from experts about how best to make CLASS work
and then take the necessary steps to ensure that happens. And
until then, CLASS should remain on the law books. For these
reasons and more, we join in opposing H.R. 1173.
Background and Origins of CLASS
The nation's long-term care crisis has been present and
fully recognized for some time now. Numerous blue ribbon panels
have been assembled and dozens of reports have been written--
all calling for a national response to the problem.\9\
---------------------------------------------------------------------------
\9\See, e.g., National Council on Disability, The State of 21st
Century Long-Term Services and Supports: Financing and Systems Reform
for Americans with Disabilities (Dec. 2005) (online at www.ncd.gov);
and The Pepper Commission, U.S. Commission on Comprehensive Health
Care, A Call for Action: Final Report (U.S. Government Printing Office
(Sep. 1990).
---------------------------------------------------------------------------
Until the enactment of CLASS, Congress failed to meet this
challenge. Without it--or some other similar program in place--
our long-term crisis will only be exacerbated. The numbers and
statistics speak for themselves:
Currently, there are over 10 million Americans who
need long-term care, and this number is expected to grow to 15
million by 2020.\10\ Sixty percent of these individuals are
aged 65 or older, and 40% are aged 18-64.\11\
---------------------------------------------------------------------------
\10\U.S. Department of Health and Human Services, Remarks as
Prepared for Delivery by Secretary Kathleen Sebelius at the Kaiser
Family Foundation (Feb. 7, 2011) (online at http://www.hhs.gov/
secretary/about/speeches/sp20110207.html).
\11\National Clearinghouse for Long-Term Care, What is Long-Term
Care? (online at http://www.longtermcare.gov/LTC/Main_Site/index.aspx)
(accessed Oct. 24, 2011).
---------------------------------------------------------------------------
People who reach age 65 have a 40% chance of
entering a nursing home.\12\
---------------------------------------------------------------------------
\12\Ibid.
---------------------------------------------------------------------------
Today, some 1.7 million people reside in nursing
homes; another 520,000 live in assisted living facilities or
institutions.\13\
---------------------------------------------------------------------------
\13\Alliance for Health Reform, Covering Health Issues, 5th Edition
(online at http://www.allhealth.org/sourcebookcontent.asp?CHID=72)
(accessed Oct. 24, 2011).
---------------------------------------------------------------------------
More than two-thirds of individuals who reach the
age of 65 will require long-term services and supports at some
point before they die.\14\
---------------------------------------------------------------------------
\14\Congressional Research Service, Community Living Assistance
Services and Supports (CLASS) Provisions in the Patient Protection and
Affordable Care Act (ACA), p. 2 (Nov. 14, 2011) (R40842).
---------------------------------------------------------------------------
The vast majority of Americans in need of long-
term care remain at home. An estimated 52 million unpaid
caregivers bear the burden of providing this care. Their role
is crucial in keeping their loved ones out of nursing homes and
hospitals and at home with their families and friends.\15\
---------------------------------------------------------------------------
\15\AARP Public Policy Institute, Valuing the Invaluable: The
Economic Value of Family Caregiving (2008) (online at http://
assets.aarp.org/rgcenter/il/i13_caregiving.pdf).
---------------------------------------------------------------------------
But population data alone do not make the case for the need
to address the country's long-term care concerns. The costs
associated with long-term care services are exorbitantly high
and also continue to grow. For example, in 2011, the annual
cost of a nursing home stay was some $70,000, and the average
cost of personal unskilled home health services was $19 an
hour.\16\
---------------------------------------------------------------------------
\16\Congressional Research Service, Community Living Assistance
Services and Supports (CLASS) Provisions in the Patient Protection and
Affordable Care Act (ACA), pp. 2-3 (Nov. 14, 2011) (R40842).
---------------------------------------------------------------------------
Although much of the public believes otherwise,\17\
Medicaid is the primary payer for long-term care in the United
States.\18\ Nationwide, Medicaid accounts for at least 40% of
all long-term care spending.\19\ In FY 2010, state and federal
dollars for long-term care services within Medicaid totaled
approximately $120 billion.\20\ And by 2027, when the baby
boomers have aged into retirement, state Medicaid long-term
care expenditures alone are projected to reach $115 billion
annually.\21\ Clearly, as many members commented during the
hearings and mark-ups on H.R. 1173, we cannot continue to rely
on Medicaid as the primary source for financing these
services.\22\
---------------------------------------------------------------------------
\17\Most Americans--especially middle-aged and senior individuals--
believe that Medicare provides extensive coverage for long-term care
services. (AARP, Planning for Long-Term Care: A Survey of Midlife and
Older Women (Oct. 2010) (online at http://assets.aarp.org/rgcenter/
general/ltc-planning-women.pdf); and AARP, The Costs of Long-Term Care:
Public Perceptions Versus Reality in 2006 (Dec. 2006) (online at http:/
/assets.aarp.org/rgcenter/health/ltc_ costs_2006.pdf)). This is not
correct: Medicare offers only short-term skilled nursing home care and
limited home health services. (Congressional Research Service,
Community Living Assistance Services and Supports (CLASS) Provisions in
the Patient Protection and Affordable Care Act (ACA), p. 3, (Nov. 14,
2011) (R40842)).
\18\Kaiser Family Foundation, The Community Living Assistance
Services and Supports (CLASS) Act (Oct. 2009) (online at http://
www.kff.org/healthreform/upload/7996.pdf).
\19\Kaiser Family Foundation, Medicaid and Long-Term Care Services
and Supports (Mar. 2011) (online at http://www.kff.org/medicaid/upload/
2186-08.pdf).
\20\The Congressional Budget Office, March 2011 Baseline: Medicaid
(online at http://www.cbo.gov/budget/factsheets/2011b/medicaid.pdf).
\21\America's Health Insurance Plans, State Medicaid Expenditures
for Long-Term Care 2008-2027 (Sept. 2008) (online at http://
www.ahip.org/content/default.aspx?docid=24597).
\22\See, e.g., remarks of Rep. Frank Pallone (House Committee on
Energy and Commerce, Markup on H.R. 1173, the Fiscal Responsibility and
Retirement Security Act of 2011, 112th Cong., p. 209 (Nov. 30, 2011)
(transcript of the proceeding)); Rep. Phil Gingrey (House Committee on
Energy and Commerce, Markup on H.R. 1173, the Fiscal Responsibility and
Retirement Security Act of 2011, 112th Cong., p. 228 (Nov. 30, 2011)
(transcript of the proceeding)); Rep. Joe Barton (Subcommittee on
Health, House Committee on Energy and Commerce, Markup on H.R. 1173,
the Fiscal Responsibility and Retirement Security Act of 2011, 112th
Cong., p. 9 (Nov. 15, 2011) (transcript of the proceeding)); Rep.
Michael Burgess (Subcommittee on Health, House Committee on Energy and
Commerce, Markup on H.R. 1173, the Fiscal Responsibility and Retirement
Security Act of 2011, 112th Cong., p. 46 (Nov. 15, 2011) (transcript of
the proceeding)); Rep. Joe Pitts (Subcommittee on Health, House
Committee on Energy and Commerce, Hearing on the Implementation and
Sustainability of the New Government-Administered Community Living
Assistance Services and Supports (CLASS) Program, 112th Cong., p. 4
(Mar. 17, 2011) (transcript of the proceeding)); and Rep. John Dingell
(Subcommittee on Health, House Committee on Energy and Commerce,
Hearing on the Implementation and Sustainability of the New Government-
Administered Community Living Assistance Services and Supports (CLASS)
Program, 112th Cong., p. 24 (Mar. 17, 2011) (transcript of the
proceeding)).
---------------------------------------------------------------------------
Beyond these figures is the emotional and financial toll
that Medicaid long-term care coverage entails. Medicaid
eligibility for such care depends upon an individual's meeting
limited income and asset tests.\23\ Thus, for too many seniors
and disabled people in need of long-term care, Medicaid only
becomes an option after they have suffered devastating
financial losses, and have been forced to spend-down their
income and assets into poverty.\24\ As a matter of personal
dignity and basic fairness, members also agree that Medicaid
should not be the national answer to our long-term crisis.\25\
---------------------------------------------------------------------------
\23\Kaiser Family Foundation, Medicaid: A Primer (2010) (online at
http://www.kff.org/ medicaid/upload/7334-04.pdf).
\24\Judith Feder, Harriet L. Komisar, and Paul Van de Water, The
Opportunities of CLASS, The American Prospect (Sept. 22, 2010) (online
at http://prospect.org/cs/articles?
article=the_opportunities_of_class).
\25\Rep. Diana DeGette summed up this view best: ``[T]he present
situation [Medicaid] is both fiscally and morally wrong.''
(Subcommittee on Oversight and Investigations and Subcommittee on
Health, House Committee on Energy and Commerce, Joint Hearing on Class
Cancelled: An Unsustainable Program and Its Consequences for the
Nation's Deficit, 112th Cong., p. 15 (Oct. 26, 2011) (transcript of the
proceeding)).
---------------------------------------------------------------------------
Republicans argue that private long-term care insurance is
the best option.\26\ Although we agree that there is an
appropriate role for the private market, we believe the record
clearly demonstrates that private insurance has not lived up to
its billing. Premiums tend to be too expensive for most
individuals to afford, particularly those with pre-existing
conditions.\27\ Even for those who are able to purchase
coverage, private policies often impose restrictions on covered
services and providers, limitations on maximum benefits, and
uncertainty about future rate increases.\28\ As a result, fewer
than 10% of Americans aged 50 or older currently own these
policies.\29\
---------------------------------------------------------------------------
\26\The Republican position on private long-term care insurance is
captured well by Rep. Michael Burgess: ``There is no one who believes
in private long-term care insurance more than I do. . . . I think it is
the correct response of my generation to that generation that is coming
after us.'' (House Committee on Energy and Commerce, Markup on H.R.
3200, America's Affordable Health Choices Act of 2009, 111th Cong., p.
274 (July 20, 2009) (transcript of the proceeding)).
\27\Testimony of Kathy Greenlee, HHS Assistant Secretary for Aging,
Subcommittee on Oversight and Investigations and Subcommittee on
Health, House Committee on Energy and Commerce, Joint Hearing on Class
Cancelled: An Unsustainable Program and Its Consequences for the
Nation's Deficit, 112th Cong., pp. 50-51 (Oct. 26, 2011) (transcript of
the proceeding)). See also LeadingAge, Long Term Care Solutions--The
Problem (online at http://www.aahsa.org/ article.aspx?id=308) (accessed
Oct. 24, 2011).
\28\Judith Feder, Harriet L. Komisar, Robert B. Friedland, Long-
term Care Financing: Policy Options for the Future, Georgetown
University Long-term Care Financing Project (June 2007) (online at
http://ltc.georgetown.edu/forum/ltcfinalpaper061107.pdf).
\29\Congressional Research Service, Community Living Assistance
Services and Supports (CLASS) Provisions in the Patient Protection and
Affordable Care Act (ACA), p. 3 (Nov. 14, 2011) (R40842).
---------------------------------------------------------------------------
Republicans also promote the HHS Long-Term Care Partnership
Program to underscore their support for a market-based approach
to our long-term care problem.\30\ Originally conceived in the
early 1990s,\31\ this state-based program is designed to reduce
Medicaid long-term care expenditures. Under the Program, states
guarantee Medicaid coverage to people whose state-approved
private long-term care insurance policy does not, over time,
sufficiently cover the costs of their long-term care--while
also allowing such individuals to protect a specified amount of
personal assets. The Program was re-instated as part of the
Deficit Reduction Act of 2005.\32\ In 2005, four states
(California, Connecticut, Indiana, and New York) operated
programs with a total of 172,000 Partnership participants.\33\
While at least 40 states now run Partnership programs, the
number of individuals taking part in them has increased to only
some 280,000 people,\34\ hardly a significant number given the
millions of Americans in need of long-term care.
---------------------------------------------------------------------------
\30\See, e.g., remarks of Rep. Phil Gingrey (p. 189) and Rep.
Michael Burgess (p. 190) (House Committee on Energy and Commerce,
Markup on H.R. 1173, the Fiscal Responsibility and Retirement Act of
2011, 112th Cong., (Nov. 30, 2011) (transcript of the proceeding)).
\31\Robert Wood Johnson Foundation, Long-Term Care Partnership
Expansion: A New Opportunity for States (May 2007) (online at http://
www.chcs.org/usr_doc/Long-Term_ Care_Partnership_Expansion.pdf).
\32\P.L. 109-171, Section 6021.
\33\Letter from John E. Dicken, Director, Health Care, U.S.
Government Accountability Office to Sen. Charles Grassley and Sen. John
Rockefeller regarding the Long-Term Care Partnership Program (Sept. 9,
2005) (online at http://www.gao.gov/new.items/d051021r.pdf).
\34\Rep. Phil Gingrey, House Committee on Energy and Commerce,
Markup on H.R. 1173, the Fiscal Responsibility and Retirement Act of
2011, 112th Cong., pp. 188-189 (Nov. 30, 2011) (transcript of the
proceeding).
---------------------------------------------------------------------------
CLASS Program
Program description
It was against this backdrop that the Committee included
legislation\35\ to establish the CLASS Program as part of the
health reform package passed by the Committee in 2009. The
legislation was adopted as an amendment--on a bipartisan vote--
during the markup of that package\36\ and subsequently, was
included as part of the ACA that was signed into law in 2010.
---------------------------------------------------------------------------
\35\H.R. 1721, a bill to establish CLASS, was introduced by Rep.
Frank Pallone and Rep. John Dingell on Mar. 25, 2009. Its Senate
companion piece, S. 697, was introduced by Sen. Ted Kennedy on the same
day.
\36\House Committee on Energy and Commerce, Markup on H.R. 3200,
America's Affordable Health Choices Act of 2009, 111th Cong., p. 293
(July 20, 2009) (transcript of the proceeding).
---------------------------------------------------------------------------
Under the ACA, CLASS is housed in a new Title XXXII of the
Public Health Service Act (PHSA). Title XXXII establishes a
process for the HHS Secretary to develop the CLASS Program to
provide a cash benefit that eligible enrollees can use to
purchase various long-term care services and supports (LTSS).
Unlike medical treatments, LTSS assist individuals in their
day-to-day activities of daily living such as bathing,
dressing, eating and toileting. They include a wide range of
health and social services and supports to people who have
functional disabilities or cognitive impairments over an
extended period of time, with the goal of maximizing their
independence.\37\
---------------------------------------------------------------------------
\37\Congressional Research Service, Community Living Assistance
Services and Supports (CLASS) Provisions in the Patient Protection and
Affordable Care Act (ACA), p. 2 (Nov. 14, 2011) (R40842).
---------------------------------------------------------------------------
Title XXXII requires the HHS Secretary to develop and
designate a CLASS Independence Benefit Plan through which LTTS
would be available to eligible enrollees. The Plan must be
designed to best balance price and benefits to meet the needs
of its enrollees in an actuarially sound manner while
optimizing the probability of the long-term sustainability of
the program.\38\ In developing such Plan, the Secretary is also
required to consult with the CLASS Independence Advisory
Council that is established under Title XXXII as well. The
Advisory Council is to be comprised of 15 experts in long-term
care (including long-term care insurance and actuarial science)
and is specifically charged to advise the Secretary ``on
matters of general policy in administration of the CLASS
Program.''\39\
---------------------------------------------------------------------------
\38\PHSA Section 3203(a)(2)(B).
\39\PHSA Section 3207(c). To date, HHS has received over 140
applications for appointment to the Council; no members have yet been
named.
---------------------------------------------------------------------------
As currently structured, CLASS is open to working adults 18
years of age or older who are not currently living in a nursing
home or other institution. To qualify for benefits, enrollees
are required to have paid premiums for at least five years and
have been actively working for a minimum of three of those
years. To receive benefits, enrollees must be unable to perform
at least two or three activities of daily living, and this
limitation must be expected to continue for at least 90 days.
Over a life-time, a Program enrollee could have several
separate instances of qualifying for benefits.\40\
---------------------------------------------------------------------------
\40\PHSA Sections 3202 and 3203.
---------------------------------------------------------------------------
The CLASS Program would provide enrollees with a cash
benefit averaging at least $50 per day. The Program also
specifies payment rules for enrollees who are Medicaid
beneficiaries, applying a portion of the cash benefit towards
the facility cost (in the case of institutionalized
beneficiaries), or towards a state's cost of providing home and
community-based services (in the case of non-institutionalized
beneficiaries). The cash benefit is not subject to any annual
or lifetime limits and continues until the enrollee no longer
has a qualifying disability.\41\
---------------------------------------------------------------------------
\41\PHSA Section 3205.
---------------------------------------------------------------------------
As required by law, CLASS must be self-sufficient.
Financial support for the Program is to come entirely through
enrollee premiums and the Program must be demonstratively
solvent over 20- and 75-year periods. Taxpayer funds are
specifically prohibited from being used to pay for
benefits.\42\
---------------------------------------------------------------------------
\42\PHSA Section 3208.
---------------------------------------------------------------------------
Program implementation
Since its inception, concerns have been raised about the
long-term financial viability of CLASS--as it is currently
designed.\43\
---------------------------------------------------------------------------
\43\Congressional Research Service, Community Living Assistance
Services and Supports (CLASS) Provisions in the Patient Protection and
Affordable Care Act (ACA), p. 15, (Nov. 14, 2011) (R40842).
---------------------------------------------------------------------------
In response to these concerns (as well as criticism about
the overall implementation process), HHS recently released a
report to update Congress, Program advocates, and other
interested parties on the status of CLASS. The report, titled A
Report on the Actuarial, Marketing, and Legal Analyses of the
CLASS Program,\44\ details the Department's efforts over the
past 19 months to ensure that CLASS is designed to be
actuarially sound and financially solvent, while meeting other
statutory requirements. Among its many CLASS-related actions
during this time, the Department convened an interagency long-
term care work group; commissioned external analyses and
conducted its own analyses on benefit plan design and other
issues central to Program implementation; conducted over 75
stakeholder meetings; began to develop implementing
regulations; and initiated marketing research.
---------------------------------------------------------------------------
\44\Department of Health and Human Services, Report on the
Actuarial, Marketing, and Legal Analyses of the CLASS Program (Oct.
2011) (online at http://aspe.hhs.gov/daltcp/reports/2011/class/
index.shtml).
---------------------------------------------------------------------------
As part of this effort, HHS modeled eight different benefit
plans, including one that is based on the most natural reading
of the CLASS authorizing statute. Each such plan is described
in the Department's Report. As noted in the Report, some of the
benefit plans and features evaluated by the Department would
require additional statutory authority to implement. The
Department's comments offer important insight into potential
adjustments to current law that could potentially allow CLASS
to move forward as intended--both substantively and
financially.
Nonetheless, the HHS report concluded that as presently
structured, CLASS cannot be carried out in a manner that would
meet its statutory requirements. Accordingly, HHS Secretary
Sebelius has instructed that implementation of CLASS be
suspended.\45\ However, in her memo accompanying the Report,
Assistant Secretary for Aging Kathy Greenlee clearly states
that HHS intends to continue to work with Congress and long-
term care stakeholders to explore ways to address the nation's
pressing long-term care needs.\46\
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\45\Letter from Kathleen G. Sebelius, HHS Secretary to Rep. John
Boehner, Speaker of the House regarding the CLASS Program (Oct. 14,
2011) (online at http://www.hhs.gov/secretary/letter10142011.html).
\46\Memorandum on the CLASS Program from Kathy Greenlee, HHS
Assistant Secretary for Aging to Kathleen Sebelius, HHS Secretary (Oct.
14, 2011) (online at http://aspe.hhs.gov/daltcp/reports/2011/class/
CLASSmemo.shtml).
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Additional Long-Term Care Provisions in Title VIII of
the ACA
National Clearinghouse for Long-Term Care
Established under Section 6021(d) of the 2005 Deficit
Reduction Act,\47\ the HHS National Clearinghouse for Long-Term
Care Information is designed to educate consumers on their
long-term care options, including Medicaid and private long-
term care insurance.\48\ Under the 2005 law, the Clearinghouse
was authorized at a mandatory funding level of $3 million for
each of the years from FY 2006 through FY 2010.
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\47\P.L. 109-171.
\48\Department of Health and Human Services, National Clearinghouse
for Long-Term Care Information (online at http://www.longtermcare.gov/
LTC/Main_Site/index.aspx) (accessed Nov. 9, 2011).
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HHS utilized these funds to launch its ``Own Your Future''
initiative in partnership with both the National Governors
Association and the National Conference of State Legislatures
to promote awareness among recent and near retirees about the
importance of planning ahead for their long-term care
needs.\49\ The initiative used direct mail (including a letter
from state governors) and media spots to encourage individuals
between ages 50 and 70 to request a long-term care planning kit
developed by HHS. Five states (Arkansas, Idaho, Nevada, New
Jersey, and Virginia) initially participated in the program; it
was later expanded to include 20 states and the District of
Columbia.\50\ All told, ``Own Your Future'' reached over 18
million residents in 26 states during the Clearinghouse's
initial authorization period, with approximately 1.5 million
individuals requesting further information on long-term care
planning.\51\
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\49\Department of Health and Human Services, Final Report: ``Own
Your Future '' Consumer Survey (Nov. 30, 2006) (online at http://
aspe.hhs.gov/daltcp/reports/2006/OYFsurvey.htm).
\50\Additional states included Colorado, Georgia, Iowa, Kansas,
Kentucky, Maryland, Massachusetts, Michigan, Missouri, Nebraska, North
Dakota, Ohio, Oklahoma, Pennsylvania, Rhode Island, South Dakota,
Tennessee, Texas, and Washington.
\51\Department of Health and Human Services, ``Own Your Future''
Long-Term Care Awareness Campaign Response Summary (July 28, 2010).
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Title VIII of the ACA reauthorizes the National
Clearinghouse through FY 2015, making $15 million in total
mandatory funding ($3 million for each of FY 2011 through FY
2015) available for this resource.\52\ Such funding would allow
the Clearinghouse to build on its previous work with the states
in providing important and unbiased information about both the
need for long-term planning and the availability of various
long-term care options.
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\52\ACA, Section 8002(d).
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In FY 2011, HHS issued the Promoting Long-Term Care
Awareness solicitation to renew the ``Own Your Future''
initiative and transition from direct mail to Internet-based
activities, including use of social media. HHS reports that it
has recently awarded a one-year contract, with an option for
renewal, to continue work on this project.
Personal Care Attendants Workforce Advisory Panel
Title VIII also establishes the Personal Care Attendants
Workforce Advisory Panel to provide counsel to the Congress and
the HHS Secretary on workforce issues related to personal care
attendant workers.\53\ Personal care attendants are individuals
trained to enable the elderly and people with disabilities to
continue to reside in their homes or within their communities
by assisting with activities of daily living. This discipline
is an important part of ensuring the adequacy of LTSS since a
high proportion of people with long-term care needs reside
outside of institutions.
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\53\ACA, Section 8002(c).
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The 15 inaugural members of the Advisory Panel have already
been named; their work is expected to get underway shortly.
H.R. 1173: ``Just Say No''
The Republican response to all of this--to CLASS, to the
National Clearinghouse for Long-Term Care and to the Personal
Attendants Workforce Advisory Panel--is to ``just say no.'' And
that is exactly what H.R. 1173 sets out to do--to terminate the
only significant federal program dedicated to the provision of
LTSS; to end the guaranteed funding mechanism for the National
Clearinghouse; and to stop a workforce advisory group that has
already been appointed. This despite Republican claims that
they join with us in recognizing that: (1) the United States is
facing a potentially catastrophic long-term care crisis;\54\
(2) Medicaid can no longer be viewed as the answer to this
crisis;\55\ (3) CLASS seeks to address an important policy
goal;\56\ and (4) the National Clearinghouse is an essential
tool in educating the public about long-term planning and long-
term care options, including private insurance policies.\57\
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\54\Supra, footnote 1.
\55\Supra, footnote 22.
\56\Supra, footnote 4.
\57\At the full Committee markup, Rep. Lee Terry offered an
amendment (that was adopted) to restore funding authority for the
National Clearinghouse that would have been taken away completely under
H.R. 1173. During the debate on the amendment, Republicans spoke in
strong support for the Clearinghouse. See, e.g., remarks of Rep. Lee
Terry (p. 180), Rep. Phil Gingrey (p. 189), and Rep. Michael Burgess
(p. 190) (House Committee on Energy and Commerce, Markup on H.R. 1173,
the Fiscal Responsibility and Retirement Act of 2011, 112th Cong. (Nov.
30, 2011) (transcript of the proceeding)). For further commentary on
the Terry amendment, see footnote 61, infra.
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What would Republicans put in place instead? Absolutely
nothing. For those in need of LTSS, Republicans would keep the
status quo--reliance on Medicare that offers very little
coverage of these services; on Medicaid that robs the elderly
and disabled of their dignity and financial resources; and on
the private long-term care insurance market whose policies are
far too costly for most Americans to afford. And for those
seeking guidance on how best to prepare for a time when long-
term care services may be needed, Republicans would allow the
National Clearinghouse to be zeroed out altogether during the
annual appropriations process. Enactment of H.R. 1173 would
produce both of these results.
This scorched-earth approach to the entirety of Title VIII
of the ACA was clearly demonstrated throughout the full
Committee mark up of H.R. 1173. Indeed, during the proceedings,
Republicans:
Rejected a process through which CLASS could
be reviewed and evaluated by experts (the CLASS
Independence Advisory Council) and adjusted and
improved by Congress;\58\
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\58\See debate on the amendments offered by Rep. Frank Pallone
(House Committee on Energy and Commerce, Markup on H.R. 1173, the
Fiscal Responsibility and Retirement Act of 2011, 112th Cong., pp. 203-
221 (Nov. 30, 2011) (transcript of the proceeding)).
---------------------------------------------------------------------------
Rejected the establishment of an alternative
long-term care program to replace CLASS;\59\
---------------------------------------------------------------------------
\59\See debate on the amendment offered by Rep. Ed Towns (House
Committee on Energy and Commerce, Markup on H.R. 1173, the Fiscal
Responsibility and Retirement Act of 2011, 112th Cong., pp. 222-240
(Nov. 30, 2011) (transcript of the proceeding)).
---------------------------------------------------------------------------
Rejected penetration of the private long-
term care insurance market as the standard by which
repeal of CLASS should be measured;\60\ and
---------------------------------------------------------------------------
\60\See debate on the amendment offered by Rep. Eliot Engel (House
Committee on Energy and Commerce, Markup on H.R. 1173, the Fiscal
Responsibility and Retirement Act of 2011, 112th Cong., pp. 241-257
(Nov. 30, 2011) (transcript of the proceeding)).
---------------------------------------------------------------------------
Rejected current law (which Republicans
originally supported) to provide mandatory spending for
the National Clearinghouse for Long-Term Care.\61\
---------------------------------------------------------------------------
\61\See debate on the amendment offered by Rep. Lois Capps. (House
Committee on Energy and Commerce, Markup on H.R. 1173, the Fiscal
Responsibility and Retirement Act of 2011, 112th Cong., pp. 182-202
(Nov. 30, 2011) (transcript of the proceeding)).
The Capps amendment was offered as a second degree amendment to the
amendment offered By Rep. Lee Terry that would retain the ACA's
extension of the authority for the National Clearinghouse through FY
2015, but would also convert its funding stream from mandatory spending
to discretionary spending, subjecting the Clearinghouse to the vagaries
of the annual HHS appropriations process. It should be noted that the
Terry Amendment was filed nearly three hours after the Capps Amendment
was released, suggesting that Republicans chose to reverse course only
upon learning that their position on the National Clearinghouse would
be challenged and calling into question their firm conviction that
private long-term insurance is the best way to solve the country's
long-term care problem.
---------------------------------------------------------------------------
In sum: While our Republican colleagues have joined us in
recognizing that we face an immediate and pressing long-term
care challenge as a nation, they have refused to join us--or
their constituents in need--in meeting this challenge. Instead,
they place their faith in what is not working and argue that it
is best to put off debate on the issue until another day. We
believe such a position is both misguided and untenable and,
therefore, must be rejected. Consistent with this view, we must
also reject H.R. 1173.
An Anti-Health Reform Ideological Agenda
The ``just say no'' view expressed through H.R. 1173 is
consistent with the Republican anti-health reform ideological
agenda. What Republicans have not been able to achieve in whole
cloth,\62\ they are now attempting to do piece by piece.\63\
H.R. 1173 puts the CLASS Program in the frontline of this
ongoing assault.
---------------------------------------------------------------------------
\62\Although the House of Representatives has passed a bill to
repeal the ACA (H.R. 2), that legislation will not become law since the
Senate has defeated the proposal. (H.R. 2 passed the House on January
22, 2011 (Congressional Record, H322-323). The Senate defeated a
similar proposal the following month on February 2, 2011 (Congressional
Record S475)). In any case, President Obama has made clear that he will
veto any such legislation. (Executive Office of the President, Office
of Management and Budget, Statement of Administration Policy: H.R. 2--
Repealing the Affordable Care Act (Jan. 6, 2011) (online at http://
www.whitehouse.gov/sites/default/files/omb/legislative/sap/112/
saphr2r_20110106.pdf)).
\63\Efforts in the House of Representatives to repeal or otherwise
destroy individual parts of the ACA include: H.R. 358, Protect Life Act
(passed the House on Oct. 13, 2011 (Congressional Record, H6885-6903));
H.R. 1214, To Repeal Mandatory Funding for School-Based Health Center
Construction (passed the House on May 4, 2011 (Congressional Record
H2969-2977)); H.R. 1216, To Convert Funding for Graduate Medical
Education in Qualified Teaching Centers from Direct Appropriations to
an Authorization of Appropriations (passed the House on May 25, 2011
(Congressional Record H3361-3388; H3396-3401; H3430-3434)); and H.R.
1217, To Repeal the Prevention and Public Health Fund) (passed the
House on Apr. 13, 2011 (Congressional Record H2633-2647)). To date,
none of these bills has been considered by the Senate.
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But in this instance, Republicans have gone beyond their
``just say no'' mantra and have asserted an additional line of
attack in opposition to CLASS. Time and again, Republicans
claim that CLASS was only included in the ACA as a ``budget
gimmick''; as a way to help pay for the ACA\64\--this despite
unequivocal testimony to the contrary.
---------------------------------------------------------------------------
\64\See, e.g., Sen. John Thune, Rep. Fred Upton, Rep. Joe Pitts,
Rep. Cliff Stearns, Rep. Denny Rehberg et al., CLASS' Untold Story:
Taxpayers, Employers, and States on the Hook for Flawed Entitlement
Program (Sept. 2011) (online at http://energycommerce.house.gov/media/
file/pdfs/class/classuntoldstoryreport.pdf). See also remarks of Rep.
Joe Pitts (p. 3); Rep. Marsha Blackburn (pp. 19-20); Rep. Michael
Burgess (pp. 23-24); and Rep. Charles Boustany (p. 45) (Subcommittee on
Oversight and Investigations and Subcommittee on Health, House
Committee on Energy and Commerce, Joint Hearing on Class Cancelled: An
Unsustainable Program and Its Consequences for the Nation's Deficit,
112th Cong. (Oct. 26, 2011) (transcript of the proceeding)).
---------------------------------------------------------------------------
At the October 2011 hearing on CLASS, in response to
questions on this issue, the HHS Assistant Secretary for
Planning and Evaluation testified that the Administration
supported CLASS because of ``the indisputable need to protect
people from the cost of long-term care services'' and that the
estimated savings attributed to CLASS by the Congressional
Budget Office (CBO) during the health reform debate\65\ were
``certainly encouraging,'' but in no way were the definitive
argument for including CLASS within the ACA.\66\ The Assistant
Secretary went on to state that even after discounting the
savings CBO initially projected for CLASS, the ACA would still
save more than $120 billion during the next 10 years and over
one trillion dollars in the subsequent decade.\67\ She also
underscored the point that over 30 million Americans are
expected to gain health insurance when the ACA is fully
implemented and detailed the ACA benefits already experienced
by seniors, small businesses, and young adults--none of which
would be impacted by the Department's decision to defer work on
CLASS.\68\
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\65\In December 2009, CBO estimated CLASS provisions would reduce
deficits by $72 billion over the 10-year period from 2010 through 2019,
including $2 billion in Medicaid savings. (Letter from Douglas W.
Elmendorf, Director, Congressional Budget Office to Sen. Harry Reid,
Leader, Senate (Dec. 19, 2009) (online at http://www.cbo.gov/ftpdocs/
108xx/doc10868/12-19-Reid_Letter_Managers_Correction_Noted.pdf)). CBO
most recently estimated that prior to HHS' announcement to suspend
implementation of the Program, CLASS would have reduced the deficit by
$81 billion over the 10-year period from 2012 through 2021. The
estimate does not include $2 billion in savings to Medicaid.
(Congressional Budget Office Cost Estimate of H.R. 1173, Fiscal
Responsibility and Retirement Security Act of 2011 (Dec. 2, 2011)).
\66\Testimony of Sherry Glied, HHS Assistant Secretary for Planning
and Evaluation, Subcommittee on Oversight and Investigations and Health
Subcommittee, House Committee on Energy and Commerce, Joint Hearing on
Class Cancelled: An Unsustainable Program and Its Consequences for the
Nation's Deficit, 112th Cong., pp. 75-76 (Oct. 26, 2011) (transcript of
the proceeding)).
\67\Ibid at p. 74.
\68\Ibid at pp. 91-93.
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Nonetheless, Republicans have persisted in misrepresenting
both the relevance of the initial CBO score for CLASS in paying
for the ACA and the fiscal impact of suspending the Program's
implementation.\69\ In our view, this is nothing more than part
of the Republican strategy to disrupt, dismantle, and
ultimately destroy the ACA. For this reason as well, we oppose
H.R. 1173.
---------------------------------------------------------------------------
\69\See, e.g., remarks of Rep. Fred Upton (House Committee on
Energy and Commerce, Markup on H.R. 1173, the Fiscal Responsibility and
Retirement Security Act of 2011, 112th Cong., p. 8 (Nov. 29, 2011)
(transcript of the proceeding)); Rep. Joe Pitts (Subcommittee on
Health, House Committee on Energy and Commerce, Markup on H.R. 1173,
the Fiscal Responsibility and Retirement Security Act of 2011, 112th
Cong., p. 3 (Nov. 15, 2011) (transcript of the proceeding)); and Rep.
Tim Murphy (Subcommittee on Health, House Committee on Energy and
Commerce, Markup on H.R. 1173, the Fiscal Responsibility and Retirement
Security Act of 2011, 112th Cong., p. 13 (Nov. 15, 2011) (transcript of
the proceeding)).
---------------------------------------------------------------------------
Conclusion
We agree that the CLASS statute has not been crafted
perfectly--no complicated piece of legislation is, especially
one that is as novel and unique as CLASS. But regrettably,
Republicans--as part of their all out war on the ACA--have
chosen to tear CLASS down altogether rather than work with us
and HHS to make it right. That is what we can and should do in
order to achieve the goal we all share--ensuring that Americans
who require long-term services and supports are able to get
what they need without the threat of impoverishment.
We stand ready to take up the challenge of long-term care
with our Republican colleagues and hope they will join in such
an effort. In the meantime, we also stand by the long-term care
framework presented by CLASS and in turn, must oppose H.R.
1173.
Henry A. Waxman.
Edolphus Towns.
Tammy Baldwin.
G.K. Butterfield.
Diana DeGette.
Bobby L. Rush.
Edward J. Markey.
Donna M. Christensen.
Anna G. Eshoo.
Kathy Castor.
Frank Pallone, Jr.
Lois Capps.
Jan Schakowsky.
John D. Dingell.
Jay Inslee.
Eliot L. Engel.
Gene Green.
Doris O. Matsui.
Mike Doyle.
Charles A. Gonzalez.