15 October 2011

The First Shoe Drops for Obama Care

The Obama administration just shut down the CLASS long term health insurance program:
A long-term disability care program shepherded into the U.S. health overhaul by Senator Edward Kennedy before his death was canceled as financially unsustainable by health secretary Kathleen Sebelius.

Republicans opposed the so-called Class Act that created the program. It will be indefinitely suspended, Sebelius said today in a statement, because the program isn’t likely to generate enough revenue to pay for its benefits.

Democrats led by Kennedy created the plan to help people disabled by illness or accident. By paying premiums while employed, beneficiaries would be eligible after five years for at least $50 a day toward health and support services provided at home. The program was billed as paying for itself.

“I do not see a viable path forward for Class implementation at this time,” Sebelius said in a letter to congressional leaders.

Republicans celebrated the program’s demise, calling it misguided policy used as a financial gimmick to reduce cost estimates of the health law. At the time, the Congressional Budget Office subtracted $70 billion from the cost of the law thanks to Class -- which stands for Community Living Assistance Services and Supports -- contributing to $143 billion in total savings, because the program’s premiums would exceed benefits over its first decade.
This is what happens when you try to create a program that accommodates the sources of the problem (insurance companies and for-profit healthcare), because you lack the courage, and quite frankly the interest, in actually fixing the system, as opposed to just slapping the label "Healthcare Reform" on half measures.

The fact that this will add $70 billion over the next ten years to the cost of healthcare reform will lend credence to Republican attacks in the 2012 campaign season.

This is why half measures, particularly when they did not serve to secure meaningful bipartisan support, create more than just bad policy, they create bad politics.


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