“The CLASS Act […] is one of the most innovative and creative ideas in our bill.”
--Senator Chris Dodd (D-CT), July 30, 2009
During the debate over the President’s government takeover of healthcare in March 2010, former House Speaker Nancy Pelosi (D-CA) famously pled with lawmakers to pass the bill so the American people could find out what was in it – highlighting Democrats’ “fire, aim, ready” approach to governing. Her wish was granted. The bill was passed, and Americans were given a chance to examine the fatally-flawed healthcare law.
When health insurance premiums rose dramatically last year, Americans found out just how wildly off-target Democrats’ promises of increased affordability were. Now Americans are learning the law itself will cost more than advertised.
Ten days ago, the Obama Administration was forced to quietly abandon the CLASS Act, a major provision of its government takeover of healthcare, after the Secretary of Health and Human Services finally admitted what Republicans had long argued – that the program was destined to fail. The CLASS Act was supposed to provide long-term care to policyholders, but was poorly-conceived, built on faulty assumptions, and plagued with incurable flaws.
The just-in-time cancellation of a half-baked entitlement program destined to wreak havoc on the federal budget might seem like a cause worth celebrating, but jettisoning the CLASS Act wipes out $86 billion in “deficit reduction” promised by the President. In other words, the price of the government takeover of healthcare just went up by $86 billion.
The President and Democrats in Congress argued the program would actually reduce the deficit, but the “savings” produced by the bill were a scam. Democrats assured Americans that the program was fully paid for and actuarially sound. Senate Majority Leader Harry Reid (D-NV) promised CLASS would be solvent “decades and decades into the future.” In reality, the program survived a mere 19 months.
Recognizing the CLASS Act’s inherent flaws, Senator Judd Gregg (R-NH) successfully inserted an Amendment into the bill requiring the Secretary of Health and Human Services to certify that the program would be fiscally solvent for at least 75 years before implementing the program. When that task proved impossible, the program was abandoned. Wouldn’t it be nice if the rest of the healthcare law was required to live up to its promises?
THE PATH FORWARD
The CLASS Act was so deeply-flawed – riddled with faulty assumptions and Washington budget gimmicks – that even its proponents finally threw in the towel. Despite the Administration’s plain admission that the CLASS Act is unworkable, President Obama has vowed to block any attempt to repeal the disastrous program. The failure of the CLASS Act underscores the need to replace the President’s government takeover of healthcare with sensible, market-based reforms that meet Americans’ needs without jeopardizing the nation’s financial future.
Note: The House Energy and Commerce Committee is holding a hearing this Wednesday, October 26, 2011, at 9am titled CLASS Cancelled: An Unsustainable Program and Its Consequences for the Nation’s Deficit.