Health care reform provision at-a-glance Long-Term Care

October 23, 2010

Under the Patient Protection and Affordable Care Act (or health care reform law), the secretary of Health and Human Services will establish a voluntary long-term care (LTC) insurance program called Community Living Assistance Services and Supports (CLASS) by January 1, 2011. The program will offer the CLASS Independence Benefit Plan, but the new law does not specify a date for enrollment. This is a government program.

What the provision does

The long-term care provision of health care reform law is designed to help individuals and families pay for long-term care. Fewer than 10% of older Americans currently have private LTC coverage. The CLASS program attempts to address gaps in coverage by offering a long-term care insurance plan. However, it offers limited benefits.

Who can enroll

Employers will need to decide if they will offer the CLASS program to employees. If an employer chooses to participate, employees age 18 and older must be automatically enrolled in the program, regardless of their pre-existing conditions. Employees can choose to “opt-out” if they don’t want to participate. CLASS is also available to individuals who are self-employed, have more than one employer or have an employer who chooses not to participate.

How the premiums will be determined

Premiums will be established by the U.S. Department of Health and Human Services secretary and will be based on age and not health risk. Based on the information available, we believe premium subsidies will be available for workers with incomes below the federal poverty level and full-time students age 18 to 21 who work.

How to qualify for benefits

After paying premiums for five years, enrollees will be eligible to receive benefits.CLASS will be administered by the U.S. Department of Health and Human Services

This content is provided solely for informational purposes. It is not intended as and does not constitute legal advice. The information contained herein should not be relied upon or used as a substitute for consultation with legal, accounting, tax and/or other professional advisers.

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