Hot Topics: Demise of the CLASS Act

The Obama administration is abandoning the long-term care insurance that was included in the health-care reform package passed by Congress in 2010 after concluding that the program was financially unworkable.

In a letter to Congress, Secretary of Health and Human Services Kathleen Sebelius announced cancellation of the Community Living Assistance Services and Supports (CLASS) program. The program would have enabled working adults to purchase government-administered insurance to cover their nonmedical costs if they became disabled and needed help with daily living activities such as bathing, dressing and housework. The insurance also could have been used to cover the cost of special technology and transportation for the disabled. (Here's a SecondAct column by Mark Miller on the program.)

Sebelius wrote that after 19 months, government officials had been unable to find a way to structure the program so that it could remain solvent for 75 years, as required by law. "I do not see a viable path forward for CLASS implementation at this time," she concluded.

Washington Post economics blogger Ezra Klein notes that the Obama administration never had been that thrilled with CLASS, which had been included in the health-care reform package mostly because the late Sen. Ted Kennedy, D-Mass., had championed it. Klein commends the administration for cutting its losses early, even at the risk of offending liberal Democrats who strongly support the program. Obama officials "proved themselves committed to a financially sound health-reform plan," he argues. He also cites the Congressional Budget Office's projections that health-care reform's long-term cost savings from 2020 and beyond actually will be higher.

Political opponents of the health-care reform law, however, point to CLASS's demise as proof that "Obamacare," as critics call it, is doomed to failure because of its expense and impracticality. Peter Rolf, a conservative blogger for US News, writes that "little by little, bit by bit, Obamacare seems to be falling apart," while a Wall Street Journal editorial calls the cancellation "a welcome if overdue admission that Obamacare's claims of deficit reduction were always an illusion."

The bottom line: PBS news analyst Susan Dentzer says the demise of CLASS leaves baby boomers without an affordable safety net to cover their costs should they become disabled. She warns that "seven out of 10 people turning 65 today are going to experience a degree of functional disability in the future, whether it's trouble eating, going to the bathroom, or any of the other normal things people do." The only other present option, she says, is "very expensive" private insurance. Dentzer says the nation has to find a way to deal with the long-term care problem, but doubts whether a political solution is possible.

In other news:

Tom Waits is Back: Gravelly-voiced bohemian troubadour Tom Waits, whose odes to hardscrabble hipsters, tormented romantics and wistful floozies made him the boomers' cross between Damon Runyon and Jack Kerouac, is back with a new CD after a seven-year hiatus. Compared to the 61-year-old Waits' previous effort, 2004's Real Gone, the soon-to-be-released Bad as Me is a return to the "mixture of old-timey and surreal that Mr. Waits has long savored, with twangy guitars, pushy horns, woozy saloon piano and drumming that conjures roadhouses, music halls and military tattoos," says New York Times music critic Jon Pareles. I'm not sure what that last part implies, but the record features some top-notch guest stars, such as Keith Richards and David Hidalgo of Los Lobos.

100-Year-Old Runner Finishes Marathon: NPR reports that Fauha Singh has become the oldest -- and the first centenarian -- ever to run a marathon. Singh, a British citizen born in India, crossed the finish line of the recent Toronto Marathon in just over eight hours, 11 minutes. Singh, who took up running at 80, is proof that it's never too late to start exercising. He stays slim and energetic with a sparse diet of mainly tea, toast and curry, and regularly runs 10 miles daily.

Social Security Recipients Get Raise: About 55 million Americans who receive Social Security benefits will get a 3.6 percent increase next year, their first raise since 2009, as the Associated Press details. Another 8 million people who receive Supplemental Security Income will also receive the 3.6 percent cost-of-living adjustment. A caveat: Columist Mark Miller explains that as Social Security increases, Medicare costs will rise, too.

Branson Touts Space Tourism: This week, Virgin Group founder and billionaire adventurer Sir Richard Branson joined with New Mexico officials to dedicate Spaceport America, the world's first built-from-scratch commercial spaceport. Branson celebrated the event in his characteristically flamboyant style, rappelling from a balcony and taking a lusty swig from the bottle of champagne that he used to christen the spaceport in the desert of southern New Mexico. Branson's Virgin Galactic space airline is testing the rocket that it will use to launch suborbital space tourism flights from the $209 million spaceport. The first flights could happen as early as 2013, SFGate.com reports.

What's Next -- 'Baby Boomers on Board' Stickers? A Massachusetts legislator has proposed the creation of special baby boomer license plates, which would help to raise money for the services that aging boomers will require. Rep. Sarah Peake, D-Provincetown, says the optional plates would cost $30, and proceeds would go to the state's Executive Office of Elder Affairs, the Boston Globe reports.

Are New Retirees Shunning Florida? Reuters reports that boomers are not as enthralled with the Sunshine State as previous generations of retirees. One study shows that migration from New York state to Florida, for example, has dropped by more than two-thirds since 2005, with North Carolina now ranking as the No. 1 destination for exiting New Yorkers. That state, and Louisiana, and Georgia as well, are competing to attract newcomers by building spiffy golf-oriented communities. Another problem for Florida is the state's unemployment rate, which is a point above the national average of 9.1 percent. That doesn't bode well for retirees who want to help support themselves with a second career.

Nearly Half of Boomers Favor Legalizing Marijuana: In a recent Gallup poll, 49 percent of people between 50 and 64 favored lifting the ban on pot. That's up from 37 percent in the same age group in 2005. Boomers may have a more favorable view of the wacky tobacky than previous generations because of familiarity; a 2009 U.S. government study suggests that more than half of boomers have smoked marijuana in their lives, though fewer than 5 percent had taken a toke in the month before they responded to the poll.

Last Word: "I used to lay in my cell and dream about this happening. It was all worth it. It was my dream come true." -- Dewey Bozella, 52, who spent 26 years in prison before being exonerated, on winning his first-and-last professional boxing match in Los Angeles