09/27/2012 12:32 am ET Updated Nov 26, 2012

Romney Finally Reveals His Nearsighted Vision for Health Reform

In the September 26 issue of the New England Journal of Medicine, both President Obama and Governor Romney offer statements revealing their vision for the future of healthcare. Up until recently, Romney has talked about how he would repeal the Affordable Care Act (Obamacare), but he has been exceedingly vague about what he would put in its place. So finally we have a definitive statement of his vision for the future. Actually -- not really. This statement doesn't offer many specifics and it is factually inaccurate in several places. So I have copied his entire statement below, with my reaction in parentheses and italics.

Replacing Obamacare with Real Health Care Reform
Mitt Romney
September 26, 2012 (10.1056/NEJMp1211516)

Health care is at once among our nation's greatest strengths and most serious challenges. People come from around the world to receive treatment in America's top medical centers, yet too many of our own citizens have difficulty gaining access to basic services. No issue is of deeper or more personal concern than guaranteeing the health of our loved ones. No American should ever have to fear being left uncared for in the middle of the world's most advanced health care system. (So far so good. We all agree.)

Unfortunately, our challenges grow worse every year. Higher premiums cut sharply into paychecks that never seem to increase. Losing a job means losing insurance coverage at the moment a family can least afford it, and those with preexisting conditions can be left with nowhere to turn, despite needing the greatest care. The sheer volume of red tape overwhelms even the most savvy consumers, while taking too much of each doctor's time and slowing innovation in life sciences. Through it all, experts continue to warn that the current path is unsustainable -- that for all its frustrations, the system is becoming more expensive and will eventually bankrupt our government. (Again, we agree.)

President Obama's 2700-page federal takeover does not solve our problems. (It's not a federal takeover. In fact, many feel it gives too much power to the insurance companies and the states.) His $1 trillion in tax increases hits the middle class hard and drives medical innovation overseas. (The tax increase statement is false.) His $700 billion in Medicare cuts "will not be viable," according to the program's trustees, jeopardizing access to care for senior citizens and throwing millions of beneficiaries off the coverage they rely on. (This is also a false claim. In fact, Obamacare strengthens Medicare. According to Politfact,

The Congressional Budget Office estimated repealing the health care law would boost spending in Medicare Part A by $517 billion, in part by restoring future increases in payments to hospitals. If the law is repealed, the fund would be unable to meet all of its obligations in 2016, eight years earlier than if the law stays in place.

Millions of other Americans who were told they could keep their coverage will lose it (Romney offers no evidence for this assertion) , and more than one third of new coverage will come through the dramatic expansion of a broken Medicaid system. (Whether Medicaid is broken is a matter of debate. But Obamacare funds States to expand Medicaid and gives them significant discretion in how to do that. )

After all this, his plan still fails to control costs (according to Medicare's chief actuary) or to provide a long-term solution to the nation's entitlement crisis (according to the Treasury Secretary), so he leaves those tasks to a board of 15 unelected bureaucrats empowered to sidestep Congress and impose drastic cuts. (The IPAB- Independent Payment Advisory Board - are not bureaucrats. They are clinical and health care experts. They cannot, by law, cut any of the benefits of Medicare. They can, however, recommend to Congress ways to control costs in Medicare, and IF Congress does not act, their recommendations can be implemented.)

If elected President, I will repeal Obamacare and replace it -- not with another massive federal bill that purports to solve all our problems from Washington, but with common-sense, patient-centered reforms suited to the challenges we face. (The President cannot repeal a law by himself obviously. Read this piece by Timothy Jost on why it would be so difficult to repeal Obamacare.)

In the health care system that I envision, costs will be brought under control not because a board of bureaucrats decrees it but because everyone -- providers, insurers, and patients -- has incentives to do it. (Specifics, Mr. Romney? How would that happen?) Families will have the option of keeping their employer-sponsored coverage, but they will also be empowered to enjoy the greater choice, portability, and security of purchasing their own insurance plans. (And how is that going for all of you in the individual insurance market today? Why would you trade the purchasing power of an employer plan for the total lack of power you would have as an individual?) As a result, they will be price-sensitive, quality-conscious, and able to seek out the features they want. Insurers will have to compete for their business. (Insurers already do compete for our business, but only if we are completely healthy and young do we get a decent price.) And providers will find themselves operating in a context where cost and price finally matter. Competition among providers and choice among consumers has always been the formula for better quality at lower cost, and it can succeed in health care as well. (Republicans have been talking about "competition" in health care for over twenty years. When they held the power in Congress, they did little to promote it other than to encourage high deductible plans and health savings accounts.)

To achieve this aim, we must end tax discrimination against persons purchasing insurance, we must strengthen and expand health savings accounts, and we must establish strong consumer protections. (WARNING: Romney plans to get rid of the tax deduction employers get for offering health care. And while health savings accounts do save money, they do so mainly by shifting costs to the individual through high deductibles and copays) The result will be patients who can confidently choose the coverage that is right for them, who know and care what health care costs, and who reward providers that deliver effectively. (Again - what power do individuals have in an insurance market?) For this choice to be meaningful, insurance market reforms must promote competition by eliminating onerous mandates, facilitating purchasing pools, and opening up an interstate market. (Selling insurance across state lines has been one of the Republicans main talking points for years. It simply means allowing insurance companies to incorporate in a state without any regulation and sell you those plans that cover you about like a hospital gown does!) Regulation must prevent insurers from discriminating against people with preexisting conditions who maintain continuous coverage. (WARNING: Note the term "continuous coverage". People who have pre-existing conditions who also have coverage will, of course, want to maintain their coverage if they can afford it. The people who are at risk are those who have these conditions who don't have coverage. For them, Romney has NO solution. Their pre-existing conditions will continue to keep them out of the insurance market)

A strengthened system must also be one where America continues to lead the world in innovation and where we continue to attract the best and the brightest, both from our own towns and from around the world, to the practice of medicine. Doctors should spend more time treating patients and less time practicing defensive medicine or processing paperwork. Innovators should increase their investments in new cures, and those cures should reach the market faster. Achieving these goals requires medical malpractice reform, a streamlined regulatory framework to support the interoperability of information technology, and strong Food and Drug Administration leadership committed to a practical and predictable approval process that appropriately evaluates risk. (Medical malpractice is the second feature of the Republican 3 talking points - competition, malpractice reform, and individual responsibility - i.e. high deductible plans. Malpractice reform is not a bad idea, but fixing it will not save much money. And when Romney talks about a "streamlined regulatory framework" or practical and predictable approval processes for new drugs, he really means taking away much of the power of the FDA to protect us from unsafe food and drugs that may not be as effective as their marketing promises. )

Finally, for our health care system to work for all Americans, we must have government programs that effectively serve our senior citizens and people in need without breaking the bank. In other words, we need genuine entitlement reform. (Agree on concept but not his methods)
I will make no changes to Medicare for those enrolled in the program today or enrolling during the next 10 years. (If Romney and the Congress were able to repeal Obamacare, Medicare would be broke in ten years. The ACA extends the life of Medicare until 2024 before it faces a budget crisis.) For younger Americans, I will implement a system similar to that used by members of Congress. (Actually what members of Congress have is more like the Affordable Care Act than what he and Ryan propose.) Future beneficiaries will have a set of Medicare-approved, guaranteed-coverage plans to choose from, including today's traditional fee-for-service option. Plans will participate in a competitive bidding process to establish the premiums they will charge, as they do in the Medicare prescription drug plan that has so effectively controlled cost. (And by the way, if you have had to choose a prescription drug plan, you know how complicated that is. ) The government will then provide premium support, set relative to the competitively bid premiums and made more generous for the poor and the sick than for the wealthy, which ensures that each beneficiary can afford high-quality coverage. (This "means testing" is wealth redistribution of course, but the hitch in the "premium support' or "voucher" approach is that unless the payments increase with inflation, seniors of tomorrow will soon be priced out of the market. ) This approach will guarantee senior citizens the financial support and high-quality care they deserve while relying on competition and choice -- not bureaucrats -- to deliver significant savings.

Nor can our society ever turn its back on those who cannot afford the care they need. (The 47% ?) We will provide support for low-income Americans and those uninsured persons whose preexisting conditions push the cost of coverage too high for them to pay themselves. (Assuming those people can actually get coverage in the first place. But with WHAT money will he "subsidize" these folks? ) But my experience as a governor and the lessons from the President's attempt at a one-size-fits-all national solution convince me that it is states -- not Washington -- that should lead this effort. I will convert Medicaid into a block grant that properly aligns each state's incentives around using resources efficiently. Each state will have the flexibility to craft programs that most effectively address its challenges -- as I did in Massachusetts, where we got 98% of our residents insured without raising taxes. (Note he does not mention that he also intends to cut Medicaid by 34%, the health program for the elderly in nursing homes, the disabled, and single women with kids.)

Everyone can agree on the goal of health care reform: ensuring affordable access to high-quality care for all Americans. The question is how. Whenever President Obama claims that only Obamacare helps those with preexisting conditions, I am reminded of the woman in Iowa who found affordable coverage in a high-risk pool despite a preexisting condition. The President's campaign took credit, but as it turned out, the high-risk pool created by Obamacare had actually turned her away . . . at which point she discovered that her state already offered a high-risk pool that met her needs. Whenever he claims that only Obamacare helps those under the age of 26 stay on their parents' insurance, I am reminded that some of our nation's largest insurers have already announced they would offer this option regardless of what the law requires . . . because they are responding to consumer demands in the market. (They are responding to the ACA not the market. Insurers never offered to do this before Obamacare.)

President Obama believes the answer lies in a bigger government that decides what care Americans should receive and how much providers should be paid for it. But his plan has already failed to deliver on virtually every promise he made, and its components are failing as quickly as they go into effect. (What is he talking about? The ACA has already delivered on many promises - more prevention, kids on parents' plans until 26, closing drug donut hole, rebates from insurance companies, etc. What components are failing? None that I know of. ) It must be repealed. I believe the answer lies with patients and families, with reformed insurance markets and fair competition, with strong consumer protections and real entitlement reform. My plan tackles our health care challenges without a federal takeover of the entire system. Instead, it relies on markets over regulations, doctors and patients over bureaucrats, and tailored state programs over a 2700-page "solution" from Washington.

This article was published on September 26, 2012, at

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