In January expect to cough up an extra $150 to $200 per month because of a new tax
‘Community Living Assistance Services and Support Act.’ But if you are already on Medicare you don’t pay. This tax was added to the Reconciliation Bill 3/19/2010 and Congress passed it two days later...surprise. The money will be used to help pay for long term care of the elderly. ALL of us will be taxed on this one, rich or poor. Everyone except those who don't have a job is included. Again, if you have a job and get a paycheck, the government will take this tax from you. The CLASS ACT is apparently a pet project of the late Sen. Ted Kennedy who was never able to get support for it because it was just too costly. Check it out on the net with;
http://www.washingtontimes.com/news/2010/Apr/01/robbing-peter-to-pay-pauls-
health-care/
At this point we are not aware of any extenuating circumstances that would relieve you of this tax. Beneficiaries of this law will include anyone age 65 and older that has paid into the Class Act program for at least five years and is receiving home health care. Under those conditions you might get some of your money back. Give Nancy a call if $200 a month will hurt.
‘Community Living Assistance Services and Support Act.’ But if you are already on Medicare you don’t pay. This tax was added to the Reconciliation Bill 3/19/2010 and Congress passed it two days later...surprise. The money will be used to help pay for long term care of the elderly. ALL of us will be taxed on this one, rich or poor. Everyone except those who don't have a job is included. Again, if you have a job and get a paycheck, the government will take this tax from you. The CLASS ACT is apparently a pet project of the late Sen. Ted Kennedy who was never able to get support for it because it was just too costly. Check it out on the net with;
http://www.washingtontimes.com/news/2010/Apr/01/robbing-peter-to-pay-pauls-
health-care/
At this point we are not aware of any extenuating circumstances that would relieve you of this tax. Beneficiaries of this law will include anyone age 65 and older that has paid into the Class Act program for at least five years and is receiving home health care. Under those conditions you might get some of your money back. Give Nancy a call if $200 a month will hurt.
6 comments:
You can opt out of this program if you want to. Your employer can offer it but you don't have to take it. From a Fox News article from 3/25/10 (see link):
"Scheduled to go into effect in January, actual deductions could take place in 2012.
Here's how the program will work:
-- The federal government will approach employers next year about alerting workers to the proposed deduction.
-- The deduction will work on a sliding scale based on age. Younger workers will be charged less, older workers more. The Congressional Budget Office pegged the average monthly deduction at $146. The Centers for Medicare and Medicaid Services put it higher, at $240.
-- After a five-year vesting period, enrollees who need help bathing, eating or dressing will be eligible to take out benefits, estimated to be around $75 a day for in-home care."
LINK: http://www.foxnews.com/politics/2010/03/26/little-known-long-termhealth-care-provision-budget-buster-say-critics/
So...maybe this "crack" news organization...err...blog...should do a little more research before posting something as if it is fact. Granted...that's never stopped anyone before and won't in the future.
Gotta love the internet...say what you want (true or untrue) and don't worry about repercussions...sweet!
Thank you for the "repercussion." This blog is going to miss something now and then and depends on readers to keep us straight. We don't pretend to be a crack news org, just a place for you to sound off. We got our "facts" from the Washington Times. Yours came frosm a better source, Fox News.
The CLASS Act's $50 per day "average benefit" will only cover a small portion of the $75,000+ per year most Americans pay for in-home care. Most people who want to protect their savings will still need to purchase long-term care insurance.
One of the biggest problems our country faces is that most Americans still think that Medicare or their medical insurance covers the cost of long-term care.
The CLASS Act addresses this problem by making a very clear statement: You have to pay for your own long-term care. You either have to pay for your own long-term care by using your savings, the $50 per day CLASS Act benefit, long-term care insurance, or a combination of these.
Most of the ten million Americans who own long-term care insurance, own it because they've seen friends or family have to spend down their assets before qualifying for Medicaid. The CLASS Act will help alert the rest of the country to the fact that they need to financially plan for their future long-term care needs.
The CLASS Act will not be an option for those who are already disabled (and unable to work) or those who are retired and do not want to work. The law requires that in order to qualify for benefits, one must pay premiums for 5 years AND must be working for at least 3 of those 5 years.
The legislation also requires that the CLASS Act program be actuarially sound and not funded by taxes. All benefits must be paid from the premiums of the participants in the program.
There are 2 reasons the projected premiums for the CLASS Act are much higher than a comparable long-term care insurance policy.
1) Anyone who is working (even just part-time) can enroll in the CLASS Act regardless of their health history.
2) Those who earn less than the federal poverty level will be automatically enrolled in the CLASS Act for only $5 per month (unless they opt-out). Their premiums are being subsidized by the rest of the enrollees.
Scott A. Olson
www.LTCInsuranceShopper.com
One thing is for certain whomever is watching Fox News isn't working at the SNH.
Thanks to all for pitching in to clarify this.
The Heritage Foundation has some info on this. Seems to agree that the sign-up is voluntary, but the plan is woefully underfunded which will result in cutting service and eventually taxpayer bills to keep the bait ans switch system from collapsing under its own bills! going. This is what the Heritage Foundation says about the Class Act:
The CLASS Act Gimmick. The new health law creates a voluntary long-term care insurance program, called the Community Living Assistance Services and Supports (CLASS) Act. Those who sign up for it must pay premiums for five years before becoming eligible for benefit payments. Consequently, premiums paid by enrollees build a small surplus—about $70 billion over 10 years according to CBO—which the health law’s proponents claim as deficit reduction. But these premiums will be needed in short order to pay actual claims.
Moreover, the Chief Actuary of the Medicare program predicts that the program will experience severe adverse selection.When that happens, the program will either need to dramatically cut benefits or get a major federal bailout. Thus, not only is it inappropriate to claim the $70 billion in premiums as savings, but this program will almost certainly become a huge new unfinanced burden on future taxpayers.
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