A total debacle. And the punchline is, everyone saw it coming — including the Democrats who went ahead and voted anyway to bring this Frankenstein to life.
Congrats to the mad scientists responsible for choosing late Friday afternoon to break the news.
Known as CLASS, the Community Living Assistance Services and Supports program was a longstanding priority of the late Massachusetts Democratic Sen. Edward M. Kennedy.
Although sponsored by the government, it was supposed to function as a self-sustaining voluntary insurance plan, open to working adults regardless of age or health. Workers would pay an affordable monthly premium during their careers, and could collect a modest daily cash benefit of at least $50 if they became disabled later in life. The money could go for services at home, or to help with nursing home bills.
But a central design flaw dogged CLASS. Unless large numbers of healthy people willingly sign up during their working years, soaring premiums driven by the needs of disabled beneficiaries would destabilize it, eventually requiring a taxpayer bailout…
“Despite our best analytical efforts, I do not see a viable path forward for CLASS implementation at this time,” Sebelius said in a letter to congressional leaders.
Social Security’s Ponzi scheme is sustainable — not forever, but for now — only because it forces new workers to pay in and keep funding benefits for retirees. CLASS tried to build the same pyramid without using compulsion to create that revenue base on the bottom. The result, soon enough, would have been an upside-down pyramid that inevitably toppled over. Look for the left to try to salvage this disaster on that grounds — that it goes to show the absolutely necessity of a mandate if you want to expand health-care coverage. True enough, I suppose. If you want a robust entitlement state, you had better be prepared for a lot of government coercion.
But wait. We haven’t touched on the real disgrace here yet. Philip Klein:
One reason why the Obama administration has been reluctant to officially shut down the program is that it was one of the main accounting gimmicks they used during the health care debate. Because the CLASS Act was supposed to collect five years of premiums before paying out any benefits, the Democrats have been claim $80 billion in short-term surplus from the program as deficit reduction, ignoring the obvious fact that the money would eventually have to pay for benefits. It’s been called a “budget zombie.”
Here’s the detailed HHS report prepared concluding that the CLASS program couldn’t work. One of the fears raised is that if it were implemented and failed, it would be problematic to shut down.
That’s another key lesson to take away about entitlements: If you want to prevent fiscal hemorrhaging later, your only option is stop the program before it’s up and running and the public’s dependency forms. I’m amazed that Sebelius was responsible enough to pull the plug on this now instead of letting it begin and roll on inexorably towards insolvency.
Um…..Whatever happened to the ”severability” clause that prevents portions of ObamaCare to be ended without it tossing out the entire thing?
And, the maths never did add up.
Not ever.
Which goes to show that a 2,000+ page law might need lots of time to be READ by lawmakers before the vote on it.
I did the math on the Open thread.
Impossible.
Hopefully this is just the beginning of the end for 0-bamacare!!