How Not to do Health Care Reform
Friday, May 23rd, 2008 By Marc Kilmer
On the subject of former Republican presidential candidates and the Wall Street Journal, the WSJ had a great editorial a couple days ago that exposes the flaws in former governor Mitt Romney’s health care plan. Unfortunately, there are some who think this Massachusetts Plan is a good idea. A commission looking at health care reform for Ohio is considering a similar plan for Ohio. The WSJ editorial should be required reading for every person on that commission:
First, the plan isn’t “universal” at all: About 350,000 more people are now insured in Massachusetts since the reform passed. Federal estimates put the prior number of uninsured at more than 657,000, so there was a reduction. But it was not secured through the market reforms that Governor Romney promised. Instead, Massachusetts also created a new state entitlement that is already trembling on the verge of bankruptcy inside of a year.
Some two-thirds of the growth in coverage owes to a low- or no-cost public insurance option. Called Commonwealth Care, it uses a sliding income scale to subsidize coverage for everyone under 300% of the federal poverty level, or about $63,000 for a family of four. Commonwealth Care also accounts for 60% of statewide growth in individual insurance over the last year, and the trend is expected to accelerate, perhaps double.
One lesson here is that while pledging “universal” coverage is easy, the harder problem is paying for it. This year’s appropriation for Commonwealth Care was $472 million, but officials have asked for an add-on that will bring it to $625 million. For 2009, Governor Deval Patrick requested $869 million but has already conceded that even that huge figure is too low. Over the coming decade, the expected overruns float in as much as $4 billion over budget. It’s too early to tell how much is new coverage or if state programs are displacing private insurance.
Tags: Health care
