Former House Speaker Nancy Pelosi (D-Calif.) famously told a grassroots group during last year’s health-care debate that the 2,000-page Patient Protection and Affordable Care Act should be passed “so you can find out what is in it.” 

Americans soon discovered the law’s higher costs and harmful mandates.  Now they are finding out about its program for long-term care known as the Community Living Assistance Services and Supports (CLASS) Act – a provision that the Obama Administration has finally admitted is unworkable and financially irresponsible.  Health and Human Services Secretary Kathleen Sebelius announced earlier this month that it had no “viable path forward.” 

                         ‘A Ponzi Scheme of the First Order’

Warnings about the CLASS Act have been around for some time.  According to a report released last month by Congressional Republicans, government actuaries cautioned against the program before the health-care law was enacted.  Senate Budget Committee Chairman Kent Conrad (D-N.D.) went so far as to call it “a Ponzi scheme of the first order, the kind of thing that Bernie Madoff would have been proud of.”  Prior to the health-care bill’s passage, I supported an amendment that would have eliminated CLASS entirely.

The claim that the CLASS Act would save money was merely a budget gimmick.  The Congressional Budget Office estimated it would reduce the deficit by $86 billion, but this only accounted for the first 10 years.  The new entitlement program was designed to collect premiums for five years before paying any benefits – creating an early windfall before an inevitable bankruptcy.  According to chief Medicare actuary Richard Foster, it would require “significant federal subsidies to continue.”  Once the front-loaded revenue ran dry, taxpayers would be left on the hook.

                            Same Law, New Math

The demise of the CLASS Act changes the accounting in the President’s health-care plan and raises even more questions about its long-term sustainability.  The program that supporters said would bring in more than half of Obamacare’s supposed deficit savings is now gone.  Much like rising health-care premiums, the collapse betrays the emptiness of politically motivated promises and the law’s lack of effective measures for reform. 

The CLASS Act is not the first component in the health-care law to be cast aside as impractical.  In April, I voted to repeal its mandate for businesses to report purchases costing more than $600 to the Internal Revenue Service – an irrelevant regulation that would have amounted to a flood of unnecessary paperwork.  Other provisions are still under dispute.  The law’s pivotal “individual mandate” requiring every American to buy health insurance is up for Supreme Court review.

                         Why We Need a Formal Repeal

I voted against the President’s health-care law last year, and I remain committed to eliminating its harmful provisions until we can achieve a full repeal.  Efforts to take CLASS completely off the books are already underway in the House of Representatives and the Senate and have earned bipartisan support.

Formally repealing the CLASS Act would eliminate the ability of government bureaucrats to reauthorize the program and guarantee that taxpayers will never have to bear its financial burden.  It also would keep attention where it is needed – finding common-sense health-care strategies that bring real savings and real-world success.

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