NAIFA GovWatch

Ways & Means Committee Votes to Repeal Unsustainable CLASS Act

Date: January 18, 2012

Issue: Health Care Reform

Action Taken: The Ways and Means Committee voted 23 to 13 in favor of H.R. 1173. The legislation offered by Congressman Charles Boustany (R-LA) would repeal the CLASS Act. Congressman Ron Kind (D-WI) was the only Democrat to join the Republican members of the Committee in voting for the legislation.

The CLASS Act was to be a government-run long-term care insurance program. It was enacted as part of the health care reform law in March 2010. In October, 2011, the Department of Health and Human Services announced that there was “no viable path forward” for the CLASS program.

NAIFA President Robert Miller issued the following statement in response to the Committee’s passage of H.R. 1173:“NAIFA applauds Congressman Boustany’s leadership and the Ways and Means Committee’s decision to repeal the unsustainable long-term care insurance program called the CLASS Act. NAIFA supports the goal of achieving financial security to cover long-term care services. However, we believe there are better ways to help people plan for their long-term care needs including the offer of quality insurance products at their place of employment. We look forward to working with Congress in a bipartisan manner to enact sustainable long-term care reform.”

Next Steps: House consideration of H.R. 1173 is the next step towards enactment. The House is expected to pass the legislation, but the legislation will face more resistance in the Senate. is vote however, marks another win towards NAIFA’s targeted revisions to the Patient Protection and Affordable Care Act.

Accomplished:

Repeal expanded 1099 reporting (repeal signed into law 4/14/11)
Repeal “Free Choice Vouchers” program that would have removed some employees from their employer plans (repeal signed into law 4/15/11)
Repeal the CLASS Act (HHS pulled the plug on implementation 10/14/11, Energy & Commerce Committee vote to repeal 11/29/11 and Ways & Means Committee vote to repeal 1/18/12)

Still Working Hard:

Remove agent compensation from the medical loss ratio (MLR) calculation. (Urge your Congressmen to cosponsor HR 1206 here.)
Remove or raise flexible spending account (FSA) contribution cap.
Repeal the additional 3.8% tax on annuities and other unearned income.

NAIFA Staff Contact: Diane Boyle, Vice President—Federal Government Relations, at dboyle@naifa.org; or Lillian Vogl, Counsel—Federal Government Relations, at lvogl@naifa.org.

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