Reflections Magazine August-September, 2011
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Mitt's massive mess

RomneyCare is a giant failure

 

 

The Massachusetts health care reform law (HRC), spearheaded by Governor Mitt Romney in 2006, requires each citizen to purchase health insurance and established an insurance exchange. This was the template for ObamaCare, the health care law that the Democratic-controlled Congress passed in March 2010. Now, both are under fire. In June, The Beacon Hill Institute (BHI) of Suffolk University released a report titled “The High Price of Massachusetts Health Care Reform” demonstrating that RomneyCare has had a negative impact on the Massachusetts economy. The BHI analysis reveals that both RomneyCare in Massachusetts and ObamaCare should be abolished.

The Medicaid mandate imposed by Lyndon Johnson's "Great Society" has been a budgetary nightmare in all 50 states. In Massachusetts, the legislative “fixes” over the years essentially kicked the can down the road.When Republican Governor William Weld assumed office in 1991, his administration confronted the reoccurring funding problem. He petitioned the federal government for a waiver, obtaining additional federal funding under a false assumption that his reforms would be "budget neutral." Once the waiver was granted, the Weld administration relaxed the eligibility rules for care under Medicaid in Massachusetts. The result was an explosion in medicaid applications, going from 670,000 in 1995 to over a million in 2001.

Massachusetts was subsequently granted an extension of the wavier. When Mr. Romney took office he and the Massachusetts legislature faced a dilemma. Unless they could get another wavier, Massachusetts would loose the extra federal funding. This meant Massachusetts would be obligated to fund its expanded medicaid program, or revert back to the standard rules followed by all the other states. The prospect of a two billion dollar shortfall would mean Massachusetts politicians would have to make serious spending cuts. The solution by Mr. Romney and his aide, Ron Preston, was a scheme to expand the program even larger. Universal health care in Massachusetts evolved in this manner. Mitt Romney cannot be considered a fiscal conservative: he balanced Massachusetts' budget by simply robbing the federal piggy bank.

Liberal Democrats recycled the same talking points for ObamaCare that Massachusetts residents were given about RomneyCare. Most erroneous was that it would save money. The BHI report conclusively refutes that assumption. On the contrary, RomneyCare is a boondoggle. What should scare American taxpayers more is the potential cost of ObamaCare, if fully implemented in 2014. Before the Massachusetts health care reform, 92 percent of the state's residents had health care insurance. Now 98.1 percent of the citizens are covered. But at a price that is exploding and becoming unsustainable. It has cost everyone involved even more money than they could ever imagine.

The costs are staggering. Since 2006 state health care expenditures have increased by $414 million; private health insurance has risen by $4.311 billion; and the federal government has spent annually an additional $2.418 billion on Medicaid in Massachusetts. In addition, over this time, Medicare expenditures have increased by $1.426 billion. The cumulative cost is thus $8.569 billion.

And where are the savings we were promised? The answer: there are no savings. Massachusetts officials have tried to dismiss this by saying health care costs are rising throughout the entire nation. In this regard, the BHI report is even more damning: Massachusetts' health care costs are 15 to 20 percent higher than the national average. Thus, Massachusetts' health care costs would be in line with the national average if  state officials had simply done nothing.

Also, private "family plan" insurance premiums have risen an average of $2500 per year since 2008, going from an annual cost of $10,000 to $12,000 per year, to about $20,000 per year today. In Massachusetts, Mr. Romney forced the federal government to pay most of its Medicaid costs. Without this subsidy, Massachusetts would have a $4 billion dollar deficit.

Another myth was that the new law would reduce emergency room visits on the vague hope the newly-insured would seek lower cost care through primary care doctors. Instead, the Massachusetts health care infrastructure has been overwhelmed. Emergency room visits have gone from 2.351 million in 2006 to 2.521 million visits in 2009. This is an increase of 7.2 percent at an increased cost of $943 million, up 36 percent compared to 2006. Many overburdened doctors are no longer accepting new patients. There are  longer waiting times to obtain an appointment. There is a simple economic explanation for this debacle: RomneyCare increased the demand for medical care without increasing the availability. Thus, the Massachusetts health care reform ensured that both health care services and health insurance costs would rise dramatically.

Nationwide, polls have consistently revealed that most Americans oppose ObamaCare. Our elected officials have failed to listen to the people. Mr. Romney and the Massachusetts legislature should have examined the Canadian and British healthcare systems in greater depth before making reforms. Many citizens there wait years for care or die before getting adequate treatment, mostly due to rationing of services. This same scenario will occur in America unless both RomneyCare and ObamaCare are repealed for two good reasons: the programs do not work and cost too much.

Americans have the very best health care in the world. It is more expensive than need be because free-market forces are not allowed into health care services. Reform ought to permit greater competition rather than creating a larger health care monopoly.

Mr. Romney reformed health care in Massacusetts thinking it would help him politically. Yet, as he runs for the highest office in the land, RomneyCare may be an albatross around his neck that will sink his chances. He cannot run as an effective reformer, since the reform is failing. Nor can he run credibly as a fiscal conservative since in essence he expanded the size and scope of the government of Massachusetts. He has the record of a liberal--and is just another calculating politician who leaves failure behind him while grasping for greater power.

-Daniel J. Dorr is a Vietnam War veteran who currently works as a Licensed Steam Engineer and Aggregate Plant Operator in Webster, Massachusetts.

 

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