Mitt Moots Modifications to Massachusetts "Miracle"

As Governor of Massachusetts, Mitt Romney proposed and, in 2006, persuaded the legislature to approve a fundamental and wide-reaching health care reform law. Liberals loved it. Unfortunately, the second act of the "Massachusetts Miracle" received far worse reviews: I detailed in March "the uncontrollable costs, inequity, increased wait-times, and strain on the system caused by the Massachusetts policy." Which hasn't stopped Obama from grounding his forthcoming healthcare reform proposal on Mitt's model.

Now, Romney himself suggests six maxims of Federal healthcare policy, based on his conclusion that "[t]he right answer for health care is to apply more market force, not less," in a May 18th Newsweek op-ed:

1. Get everyone insured. Help low-income households retain or purchase private insurance with a tax credit, voucher or coinsurance. Use the tens of billions we now give hospitals for free care to instead help people buy and keep their own private insurance. For the uninsured who can afford insurance but expect to be given free care at the hospital, require them to either pay for their own care or buy insurance; if they do neither, they would forgo the tax credit or lose a deduction. No more "free riders."

This is the basic plan I proposed in Massachusetts. It has worked: 360,000 previously uninsured citizens now have private health insurance. The total number of uninsured has been reduced by almost 75 percent. The Massachusetts plan costs the state more than expected, largely because the legislature has been unwilling to further reduce state payments to hospitals for free care. The costs should be brought in line by eliminating these payments, by requiring sustainable copremiums and by removing coverage mandates (for example, every policy is now required to include unlimited in vitro fertilization procedures).

2. Make health insurance affordable and portable. Eliminate the tax discrimination against consumers who purchase insurance on their own. This, plus getting everyone insured, will sharply lower insurance costs (in Massachusetts, the premium for a single male has declined by almost 50 percent). The result: Americans wouldn't have to worry that their insurance would be unaffordable or canceled if they changed or lost a job.

3. Give people an incentive to care how expensive and how good their health-care treatment will be. Learn from the French and Swiss experience with coinsurance, where the insured pays a given percent of the entire bill, up to some upper limit. Unlike a deductible, where there is no cost to the insured once a threshold has been reached, coinsurance means that the insured continues to care about cost.

4. Provide citizens with information about the cost and quality of providers and the effectiveness of alternative treatments. This transparency, when it's combined with a meaningful personal financial incentive, will help health care work more like a consumer market.

5.Reform Medicare and Medicaid, likewise applying market principles to lower cost and improve patient care.

6. Center reforms at the state level. Open the door to state plans designed to meet the various needs of their citizens. Before imposing a one-size-fits-all federal program, let the states serve as "the laboratories of democracy."

There's much to praise here, particularly severing the link between insurance and employment and enhancing individual incentives toward cost control. Moreover, Medicaid and Medicare need an immediate makeover.

Still, Mitt's refusal to acknowledge that governmental health mandates invariably morph into a Christmas tree of populist promises is troubling: on that path lies the Octomom. And, more generally, it's a bit late for Romney to get market-based healthcare religion when his example has paved the way for the seemingly unstoppable march toward universal coverage.

(via The Corner)