Health and Health Care

With the demise of the Community Living Assistance Services and Supports (CLASS) Act, Program on Retirement Policy Director Richard Johnson talks us through ways it could be revitalized, new policies that could boost participation in the private market, and public-private options that could help achieve higher rates of coverage.

With the CLASS Act dead, the 7 in 10 seniors who will eventually need help with eating, dressing, or bathing, and their unpaid family caregivers are wondering where they can go from here. Many relatives of the aging struggle to balance their elder care duties with employment and other family responsibilities. The care they provide equates to $375 billion a year.

Nursing home care averages about $75,000 per year (and much more in certain parts of the country), while home health aides cost about $21 per hour. Options for financing long-term care are limited. Medicare covers long-term care only under certain conditions and for only a limited time. Only 12 percent of adults age 65 or older have private insurance. As a result, many families pay out of pocket until they exhaust their resources and turn to Medicaid.

It appears the Obama administration is abandoning the Community Living Assistance Services and Supports (CLASS) Act, a program included in the Affordable Care Act that aimed to make long-term health care more affordable and accessible for most Americans. In this first video in a two-part Urban Institute package, Program on Retirement Policy Director Richard Johnson walks us through CLASS's aims and design, why greater access to long-term care is needed, and where the program ran into problems.

Long-Term Care for the Elderly provides a 360-degree view of long-term care, including what it is, why it is an important policy concern, and the key issues that all stakeholders are struggling with today and will confront in the future.

Every year Americans spend over 182 billion public and private dollars on services and supports for chronically disabled elders. This is projected to nearly double by 2030 to $341 billion and to grow to $684 billion once the last baby boomers have turned 85. And these estimates don't include the $375 billion in unpaid care family and friends provide-including foregone wages that would have helped support Medicare and Medicaid.

The Urban Institute's Program on Retirement Policy debuted its Data Warehouse on June 14, 2011. The Data Warehouse is an online resource for retirement-related statistics, which can be used to glean how those in different age brackets are faring and get a look at long-term retirement trends. Its initial data include statistics on older workers and population flows.

The Community Living Assistance Services and Supports (CLASS) Act, a provision of the landmark 2010 health law, would create a government-run, voluntary long-term care insurance program. To its supporters, CLASS is a major step toward a sustainable financing system for the care of both the frail elderly and younger adults with disabilities. But many experts believe the act's design is deeply flawed. They fear that few consumers will buy the insurance and the program will fail. Can CLASS be fixed? What changes are needed? Our panel of experts will debate various proposals.

The Health and Human Services Department has until October 2012 to finalize plans for a new government-run, long-term care insurance program called the CLASS Act. In the January edition of the Program on Retirement Policy video series, Howard Gleckman discusses the rationale behind the program's creation, the implementation and political challenges it faces, and ultimately the tough choices facing potential long-term care insurance consumers.