Published on:

Fiscal Cliff Deal Includes Federal Elder Care Changes

Unless you shut out all newspapers, online articles, and television programs over the last week, you’ve probably heard about the “Cliff Agreement” that was reached by Congress on New Year’s Day. The compromise measure surprisingly passed both chambers with support from members of both parties–though Republicans were more likely to be opposed to the bill.

The majority of focus on the details of the plan relate to taxes. After all, the bill is actually entitled the 2012 American Taxpayer Relief Act (ATRA). That major provisions include elimination of the payroll tax, increases in the capital gains and income tax for high-earning Americans, and changes to the estate tax. There are also alterations to long-term retirement accounts, with 401(k)s converted into Roth IRAs for the purpose of generating more short-term tax revenue for the federal government.

However, taxes were not the only thing at issue in the ATRA. In fact, one issue related to elder care was included as part of the compromise bill. A Forbes story provides some helpful details of the situation. In particular, the bill does two different things which may affect long-term care services, including proper access to quality facilities void of Illinois nursing home abuse and neglect.

First, the cliff agreement repeals the CLASS Act. The Act was created in 2010 and was intended to create a “voluntary long-term care insurance system.” However, the program as written never had much of a chance of survival. That is because the numbers did not add up. Actuaries found that the premiums would be too high for most to join and without changes, the program would not be financially viable. In fact, the Obama Administration, via the Secretary of Health and Human Services Department stopped implementing the program not long after its passage. In other words, the repeal via the ATRA does not come as a huge surprise.

Alternatively, on top of axing the CLASS Act, the cliff agreement created a new federal commission to plan for better financing and delivering of long-term care services. The legislation explains the purpose of the commission thusly: “develop a plan for the establishment, implementation,and financing of a comprehensive, coordinated, and high-quality system that ensures the availability of long-term services and supports for individuals in need of such services and supports… and individuals desiring to plan for future long-term care needs.”

The new commission would be a panel of 15 members appointed by the White House as well as the Congressional leaders from both parties. Those panel members would include a diverse range of interests, from those receiving the care and providing care to front-line care workers and Medicaid administrators.

While the idea of a commission crafting novel policy to actually improve the cost and access to care for seniors is encouraging, we will have to wait and see if any of it results in real change. As virtually everyone knows, there is a big difference between creating a panel to “study” an issue and actually passing legislation that changes things. As it now stands the commission has six months to create a proposal, and Congress can then vote or not vote on any of their recommended changes.

See Other Blog Posts:

The Year of Elder Abuse Prevention

Protecting Senior Pocketbooks