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Community Living Assistance Services and Supports Program: 2011 Report to Congress

On October 14, 2011, the Secretary of Health and Human Services (HHS) informed Congress that HHS had not identified a Community Living Assistance Services and Supports (CLASS) program benefit plan that is both actuarially sound for the next 75 years and consistent with the requirements of Title VIII of the Patient Protection and Affordable Care Act of 2010 (the CLASS Act). Following this announcement, HHS suspended program implementation activities.

Effective January 1, 2011, the CLASS Act established the CLASS program as a federally administered, voluntary insurance program to help working adults cover some costs of long-term-care services and supports. The CLASS Act requires the HHS Office of Inspector General (OIG) to submit an annual report to the Secretary and Congress on the overall progress of the CLASS program and the existence of waste, fraud, and abuse in the program. Each report must include findings in four areas: providing cash benefits; determining eligibility; providing quality assurance and protecting against waste, fraud, and abuse; and recouping unpaid and accrued benefits.

We reviewed progress in the development of the CLASS program from March 23, 2010, when the CLASS Act was enacted, through October 14, 2011, when program activities were suspended. This review focuses primarily on the Administration on Aging's (AoA) activities in the four areas specified in the CLASS Act's OIG annual reporting requirement after January 2011, when AoA became responsible for developing the program. We obtained data about AoA's progress from interviews with AoA senior management, a questionnaire completed by AoA staff, and documents provided by AoA to support interview and questionnaire responses.

AoA focused most of its efforts on developing at least three actuarially sound benefit plan alternatives, as required by the CLASS Act. The CLASS Act requires the Secretary to designate one of these benefit plan alternatives as the CLASS Independence Benefit Plan by October 1, 2012. As stated above, the Secretary informed Congress of the status of the benefit plan on October 14, 2011.

The Secretary has not designated a viable benefit plan. Therefore, we have no recommendations regarding program progress or the existence of waste, fraud, and abuse. OIG will determine the most appropriate way to meet OIG's CLASS Act reporting requirements in future years based on the program's status. AoA had no comments on the report.