Romney's healthcare amnesia
MITT ROMNEY will give a major address on healthcare tomorrow based on his experience in helping to pass the landmark 2006 health insurance law in Massachusetts. He ought to extol the importance of beneficent state and federal government policies in devising and implementing the law, but he probably won't.
As he campaigns for the Republican presidential nomination, Romney makes the law seem like a triumph of free-market economics. He remembers insurance executives telling him about "so many mandates and restrictions and regulations on us; if you removed some of those we could get the premiums lower. . . . And we did."
There was a little bit of that in the final law, but what really makes it work is a system of government subsidies and regulation. The federal government had already supplied Massachusetts with a generous amount of extra Medicaid dollars to cover the uninsured. The law redirects these away from hospitals and into insurance coverage. It does the same for a special state fund that paid for hospital care for the uninsured. Without these pots of money, the subsidized insurance established by the law for people near the poverty line would not be viable.
Those people whose income was too high for the subsidized policies weren't left without regulatory assistance, either. Before the 2006 law, policies for individuals buying coverage on their own were often too expensive for many people to afford. The law merged the small-group and the individual markets so that premiums from healthy people could defray the cost of those needing a lot of medical treatment. The state intervened to tame the cruelties of the free market.
Romney was an early proponent of two important elements of the 2006 law: the mandate requiring individuals to carry health insurance, and the creation of the Commonwealth Health Insurance Connector Authority (he originally called it an "exchange") to offer new kinds of subsidized and unsubsidized polices. Both ideas were wise uses of governmental power, and Romney has reason to brag about them.
Yet in the Republican primaries, talk of new mandates and agencies isn't a vote-getter. And GOP candidates aren't dwelling on the fact that federal, state, and local governments control 45 percent of heathcare spending, hardly the makings of a free market.
The most important healthcare issue in this presidential campaign revolves around the use of governmental power to insure the 43.6 million people who now live without coverage that is essential in modern life. Many Republican voters would rather hear denunciations of "mandates and restrictions and regulations." Let's hope Romney doesn't keep playing to this crowd. Either tomorrow or later, he should offer a balanced, workable proposal to cover uninsured Americans. 