Massachusetts health care plan gets notice
Washington ? John Breaux, the former senator from Louisiana known for his deal-making in Congress, has hooked up with American University to sponsor a series of Washington forums where political opposites, such as Hillary Clinton and Newt Gingrich, are challenged to explore possible areas of agreement on solving the nation’s health care crisis.
On April 17, Breaux brought together Tommy Thompson, the secretary of health and human services in the first term of President Bush, and Donna Shalala, who held the same job throughout Bill Clinton’s tenure. Republican Thompson and Democrat Shalala quickly agreed on one thing: The most interesting and potentially promising innovation in health policy in recent years is the law enacted by the Democratic Legislature in Massachusetts and signed this month by Republican Gov. Mitt Romney. That law aims at requiring every Massachusetts resident to have health insurance by mid-2007 and provides subsidies for those who need help paying the premiums.
Romney was in Washington last week and, after defending his handiwork against critics of “big government” at a session with conservative pundits and a meeting of the U.S. Chamber of Commerce, I found him primed for verbal battle when we met for lunch. What I learned convinces me that Thompson and Shalala are right.
The banner headline on Romney’s plan is the ambition to make his state the pioneer in universal coverage – an obvious breakthrough in a nation where millions are uninsured and their numbers continue to grow.
Underlying Romney’s promise is a plan for radically restructuring the health care financing system. One piece is taking the billion dollars a year the state now uses to reimburse hospitals for treating the uninsured and instead allocating those funds to subsidize low-income families’ purchase of private health insurance. Romney’s defense against the “big government” charge from conservatives who see the insurance mandate as an infringement on individual freedom is that “making the individual responsible for his own health coverage is a lot more conservative than a permanent program of government handouts to hospitals.”
That idea came from Romney and his health and welfare commissioner, Timothy Murphy. The other big outside-the-box idea was given to him by the Heritage Foundation’s Edmund Haislmaier. He proposed creation of a new organization he called an insurance exchange, which Romney renamed the Connector. In essence, it’s a type of public bank that will collect the premiums from individuals and pass them on to their chosen insurers. By creating that entity, it becomes possible under federal tax laws for individuals to buy health insurance with pretax dollars, just as employers now do in company plans. Romney estimates that this innovation will save 30 percent to 35 percent and keep the cost of a basic policy to about $200 a month per person.
This is a rare and exotic political hybrid, with a basis in a conservative think tank and the blessing of a Democratic Legislature and Sen. Ted Kennedy. The passage of such a program with overwhelming bipartisan support is a notable achievement in a time of polarized, partisan politics. But it is still just an idea. It remains to be seen how many uninsured people actually order policies, what the sign-up difficulties may be, how high the deductibles and co-pays have to be set to keep the price to $200, and whether there are sufficient economies and cost controls to make it affordable in the future.
Romney remarked, “I wish I were going to be governor the next five years to see it through,” but he has made the decision to step down at the end of this year and is preparing to seek the presidency. His preparations are serious – both in fundraising and in organizing support in early primary states. This is a one-time business consultant who likes to have his ducks in a row.
But he knows the real challenges lie ahead for him, just as they do for his health plan. One special test involves the public reaction to his Mormon faith. He thinks it won’t ultimately be a barrier, but says, “At some point, I know, I will have to face all the questions about its tenets, just as John Kennedy did in West Virginia and in the meeting with the Greater Houston Ministerial Association,” when his Catholicism was an issue. “But I think tolerance will prevail again.”
Meantime, his health plan gives him a unique calling card – and provides the country with an important opportunity to test one possible solution to a vexing problem.