What Did Secretary Sebelius Know About the CLASS Act?

At the Senate Finance Committee hearing today, Senator Thune and Secretary Sebelius discussed what was heretofore not publicly known: Reports that HHS had conducted actuarial modeling on the CLASS Act Ponzi scheme BEFORE the health care law was enacted.  (Footage will be posted on our blog here as soon as it’s available.)  Secretary Sebelius repeatedly declined to admit – or answer – whether she was aware that HHS had studied the program prior to its enactment.  This exchange raises questions related to the Department’s actions (or inactions) on this matter:

• Did modeling within HHS support the conclusion of the Medicare actuary that the program had “a very serious risk” of becoming unsustainable – and the similar conclusions of the non-partisan Congressional Budget Office that the program “could be subject to considerable financial risk in the future?”
• If preliminary HHS modeling concluded the program was sustainable, then why did the Secretary state last month that the program was “totally unsustainable” as written in the law?  What so fundamentally changed in HHS’ actuarial assumptions that the modeling went from solvent to “totally unsustainable?”
• Conversely, if internal HHS modeling before the law was passed raised significant questions about the CLASS program’s solvency – as has every other independent analysis of the program – why didn’t the Secretary disclose this information to Congress, so that Congress could fix the program prior to the bill’s enactment?
• Did Secretary Sebelius – or other HHS officials – conceal materials about the CLASS Act’s fiscal shortcomings from Congress for ostensibly political reasons, so that Blue Dog Democrats and others would lack information about the program’s unsustainable nature that might lead them to vote against enactment of the bill in the first place?

To borrow a prior analogy, the fundamental question about HHS’ actuarial studies on the CLASS Act is simple yet profoundly important:  What did the Secretary know – and when did she know it?

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• unsustainable