The latest evidence that last year's health-care bill was awful legislation comes from testimony by the woman most empowered by the bill, Health & Human Services Secretary Kathleen Sebelius. She admitted in a recent Senate hearing that the bill creates an “unsustainable” subsidy to companies whose former executives helped write it.
Sebelius at one point in her Senate Finance Committee testimony last week spoke of the CLASS Act — a provision in the bill providing optional government insurance for long-term care. As Avik Roy at Forbes tells the story:
Sebelius admitted that the CLASS Act, Obamacare’s new entitlement for elderly long-term care, is “totally unsustainable.” But, said Sebelius, not to worry; the HHS Secretary has plenty of authority to completely re-work the legislation:
The program will not start unless we can absolutely be certain that it will be solvent and self-sustaining into the future. But we do have flexibility…The snapshot in the bill, I would absolutely agree, is totally unsustainable. We do have administrative flexibility though, and we have a team including the actuary who was with Genworth who’s probably the largest provider of any kind of long term services; we are modeling things. This will not be a program that starts collecting until 2012.
Thune went on to describe a paper by Alicia Munnell and Josh Hurwitz, of the Boston College Center for Retirement Research, that describes how low participation in CLASS will doom the program to an adverse selection death spiral. Does this, asked Thune, justify an individual mandate for the CLASS program? Sebelius refused to rule it out….
But I also wanted to point to the revolving-door action going on here. Sebelius was a chief advocate for the “reform” bill, and one of her top advisors — this actuary she doesn't name — comes from long-term care giant Genworth, which now has a direct pipeline to taxpayer money through the CLASS Act.
On the other side is Connie Garner, a Ted Kennedy aide who played a central role in writing the CLASS Act, and then, according to an email she sent out, left to become “the Executive Director/CEO of a newly incorporated coalition called 'Forward CLASS', made up of those advocacy groups (aging, disability, unions, and providers) that worked to see CLASS Act included in the health care reform.”
Got that? Write a bill subsidizing long-term care, then get paid by the long-term care providers to lobby on the legislation's implementation.
Now Garner is at K Street lobbying firm Foley Hoag.
To recap: the CLASS Act is an “unsustainable” subsidy to companies whose former executives helped write it, and which are now hiring the congressional staff that helped write it.