Understanding Romneycare

Conservative criticism of Mitt Romney's involvement in Massachusetts' universal health care (so-called "Romneycare") targets one of the most misunderstood issues in the 2012 presidential race.  Critics lash out against Romneycare as proof that Romney lacks true conservative credentials, yet a closer look at the political reality that prevailed in the Commonwealth actually reveals that Romney deserves much credit for a principled, high-integrity handling of this legislation.

Understanding Massachusetts

The first and most important context to understand is that Massachusetts is full of liberal Democrat voters.  The Commonwealth's House and Senate typically are constituted with 85% to 90% Democrat majorities.  Such dramatic super-majorities are a dominant consideration in any discussion of Romneycare, as they render the governor's veto into a mere symbolic gesture that cannot stop the passage of any legislation favored by the Democrats.  For example, in Romney's last year in office, the Governor issued 250 vetoes, every single one of which was overridden.

Universal Health Care is Popular in Massachusetts

Another important and relevant fact in any discussion of Romneycare is that the idea that universal health care is now and has been very popular among the majority of Massachusetts' citizens for decades.  To win higher political office, such as the governorship or a Senate seat, tacit or explicit support for universal health care is a political necessity.

There have been multiple attempts to implement universal health care in Massachusetts.  In fact, Romneycare was the third attempt.

In the 1980s, then-Governor Mike Dukakis passed a law that every employer must provide health care insurance to all employees or pay a penalty.  In 1996 and 1997, the Commonwealth expanded and restructured the state Medicaid program, called MassHealth.  Both of these predecessors to Romneycare collapsed financially.

In 1986, the federal government passed the 1986 EMTALA law mandating that hospitals provide care to everyone regardless of ability to pay.  By 2004, treatment of the uninsured under this mandate had soared to $1.1 billion dollars per year in Massachusettsi.

The Romneycare Timeline

Beginning in 2000, a number of factors came together that triggered the drive for real universal health care and the formation of a number ofii competing plans that eventually coalesced into Romneycare.  Health care costs had skyrocketed due to the federal and state initiatives to expand coverage to all citizens, insured or not.  The costs grew so high that they got red-flagged for review by the federal government.

The federal government was providing a grant of $385 million per year to Massachusetts to help cover the $1.1-billion coverage cost for the uninsured.  In 2005, the federal government threatened to terminate this grant due to the extremely high cost per patient in the Commonwealth.  Governor Romney and legislative leaders were able to negotiate a two-year grace period during which the health care system would be reformed, thus setting the table for the universal health care debate that ultimately led to Romneycare.

An excellent paper on the subject, entitled "Building a Consensus for Health Care Reform in Massachusetts: Policymakers and the Hero Opportunity in the Bay State" by Thomas H. Little, Ph.D., includes an excellent summation and comprehensive description of the timeline and development of the universal health care push in 2005 and beyond:

After numerous discussions with business leaders, health care providers and insurers, President Travaglini turns his ideas into a concrete legislative proposal, introducing Senate Bill 2282 in April, 2005. As initially introduced, the bill proposed to cover almost half (225,000) of the state's uninsured by increasing the Medicaid reimbursement rate to hospitals and community health centers, encouraging insurance companies to provide low cost policies with basic coverage and high deductibles, provide money to increase enrollment in Medicaid and require companies who do not provide insurance to contribute to the states "uncompensated care pool" if their employees used state services for health care (free rider surcharge).

So the initial push for Romneycare was by the Senate President Travaglini, not Mitt Romney.  A common misconception is that Mitt Romney led the charge for Romneycare, but he responded to facts on the ground.

With Democrat super-majorities in the legislature, introduction of Senate Bill 2282 made passage of universal health care highly likely.  Governor Romney had a choice: veto whatever bill emerged from the legislature (which he felt was highly flawed and would ultimately hurt the citizens and financially fail), or choose not to posture but to weigh in to try to fix the legislation that would inevitably pass:

Not to be outdone, Governor Romney put forth his own proposal, introducing two bills in the House (HB 2923 and HB 2924). Like Travaglini's plan, Romney did not levy a tax or charge on the state business community. His plan relied on a redistribution of current revenues and elimination of waste and increased efficiencies created by market forces to fund the expansions. The cornerstone of the plan included a mandate that all citizens of Massachusetts be required to purchase health care much like licensed drivers are required to purchase auto insurance. Romney's plan also created the Massachusetts Exchange, a public/private partnership which would assist insurance companies in developing acceptable policies and help people identify the most effective plan for them.iii

This description of Romney's original proposal is quite different from what finally passed as Romneycare.  Romney's original proposal relied heavily on market forces to drive cost control.  Missing from the description above was that in addition to an individual mandate, the Romney proposal included an employer mandate for which he favored an "opt out" clause.  The mandates required only catastrophic coverage, not the comprehensive and expensive "Cadillac plan" coverage that was ultimately included in the bill that passed (and in ObamaCare).

There were many other parties putting forward ideas and plans.  The Blue Cross Blue Shield Foundation published their proposal in October 2005.  The BCBS plan would increase Medicaid rolls to cover children living at up to 200% of the poverty level and families at up to 133%.  It also would optimize insurance pools by consolidating smaller pools together to increase efficiencies and control costs.

House Speaker Salvatore DiMasi eventually got a House bill together six months after the Travaligni Plan and three months after the Romney Plan.  The House plan employed elements from the Travaligni, Romney, and BCBS plans.

Many advocacy groups weighed in as well:

  • Labor Unions - Sought to have employers pick up the cost of health care with no cost to the individual.

  • Health Care Providers and Hospitals - Favored increased access and coverage, effective cost management, and fair reimbursement to providers.

  • Business Community - Sought to avoid having the burden placed on employers and were looking for ways to reduce insurance costs overall.

With all of these competing plans and lobbying, universal health care did indeed become an inevitable political reality.  Ultimately, the legislature passed a compromise bill. 

Romney Now Gets Blamed for the Actions of Others

On the day that Romneycare was signed into law, Romney line-item-vetoed eight elements changed in or added into the final draft of the bill, including the employer mandate, which he felt was no longer necessary.  After the signing ceremony, though, the legislature returned to the State House and overrode all eight vetoes.

Romney's successor, Governor Deval Patrick, greatly increased the mandated level of coverage while implementing the law, which has resulted in a financial calamity and debt not structured in the original law, sending the state into a financial tailspin.  Yet Romney gets the blame for what Governor Patrick (a Democrat) wrought.

The Principled Decision by Mitt Romney

Universal health care in Massachusetts is favored by 70% of the population, and by up to 90% of the legislature.  As a candidate for governor in 2003, Romney was already making public comments about universal health care because it was one of the "hot" topics of the election.  He was asked about his thoughts by the media and gave his take on how to "do it best."

Once elected, Romney could have completely stayed out of the fray of crafting a bill.  He could have simply vetoed whatever bills got to his desk bill and avoided any backlash that might hurt his future political aspirations for having been involved.  It would have left the people he represented as governor (the people of Massachusetts) in worse shape, as his vetoes would be easily overridden, and the bill would be crafted without Romney's considerable skills at planning and finance.

For those who criticize Romney's involvement, understand that disengaging would have been a sellout of the citizens for his own personal future prospects.  Romney did not agree with selling out the people he represented for personal political gain, and he refuses to spin or lie about it now.  It was a principled decision based on his solemn commitment to his job as governor and the need to put the greater good ahead of personal political gain.  Universal care was going to happen, it did happen, and it would have been a worse law had Romney taken the easy road and not gotten engaged.  Romney is the better man for acting as he did.

The name "Romneycare" is a misnomer, obviously coined by political enemies.  The Obama team, for its part, uses Romneycare to insulate itself from attacks on ObamaCare.  David Axelrod
said in March 2011 that "[Romney's] health plan 'inspired' President Obama and was a 'template' for the White House's own national program."

So why does Romney continue to say that Romneycare was a success when empirically it is an economic disaster that also provides Obama talking points that protect ObamaCare?  Were the Romney team to start a serious defense of the political twists and turns that fundamentally changed his bill into something much worse, it would no doubt confuse the vast majority of the electorate and sway no one in the process.  The Obama campaign would undoubtedly make Romneycare the center of political discussion, thus diverting attention from the poor economy and other problematic issues that Obama faces this election cycle.

Romney cannot say that Romneycare in Massachusetts is a poor law without falling down a slippery slope and getting consumed in discussions about its failure by the Obama-complicit media.  Neither can he argue the merits or history of Romneycare without creating a media frenzy as well.  The smartest way for the Romney campaign to stay on message about Obama's failed economy is to give short messages that Romneycare is a success but to not get into the details, and so they do.

Romneycare vs. ObamaCare

Another fallacy is that Romneycare is the model for Obamacare.  For two laws that each address the problem of insuring the uninsured, these could not be more divergent.

The final bill passed in Massachusetts was 70 pages in length; the federal bill was 2,074 pages.  In Massachusetts, every legislator and all the private advocates had read the bill prior to its passage.  The federal bill largely was unread before its passage.  The federal bill does not simply nationalize health care, but puts control over health care into the hands of bureaucrats who are neither elected or under the control of Congress.

The majority of voters incorrectly believe that Mitt Romney championed the entire effort to bring universal health care to Massachusetts.  The truth is that Romney showed his integrity and true commitment to the oath of office as governor to do the best he could for the people.

That's leadership.

iAn Analysis of the Cost of Medical Care for the Uninsured in Massachusetts. (2004) The Urban Institute.

iiMcDonough, J.E. et. al. The Third Wave of Massachusetts Health Care Access Reform. Health Affairs. Web Exclusive; 14 September 2006; w420 - w431.

iii"Healthcare Reform Efforts Win Praise," Boston Globe, Page A1, April 7, 2005.

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