NR Digital

Incurable

by Ramesh Ponnuru
Mitt Romney’s health-care problem

If President Obama had failed to get his massive health-care overhaul through Congress, Mitt Romney would today be a strong frontrunner for the Republican presidential nomination. Some conservatives and libertarians would continue to object to the health-care plan he shepherded through the legislature in 2006, when he was governor of Massachusetts. But so long as conservatives were satisfied with his proposals for federal legislation on health care, he would be able to shrug off the criticism — as he did in 2008, when he ran for president and his rivals Rudy Giuliani and Fred Thompson used the issue against him. In a parallel universe without Obamacare, Romney would still have strong support among both conservatives and the party establishment.

In reality, of course, Obama succeeded and the Republican party committed itself to repeal of the new health-care law. Health care thus remains a huge issue. It will probably be the most politically important domestic-policy difference between the parties in 2012. The issue will therefore be much more important in the Republican primaries this time than it was in 2008. Already, it has conservatives looking at Romney with much more hostility. The party establishment is hedging its bets because it thinks that hostility might cost him the nomination. So Romney is a weak frontrunner, if he is a frontrunner at all.

The source of Romney’s problem is the resemblance between his Massachusetts plan and Obama’s federal one. At this point the only people who deny that resemblance are Romney and his employees. The two plans have the same basic elements. Health insurers have to charge the same rate to all comers, whatever their health condition; everyone has to buy insurance; and the government provides subsidies to help people meet this new obligation. In both plans, the number of people with insurance rises largely because more people join Medicaid, the joint federal-state program to help low-income and moderate-income people.

Jonathan Gruber, a liberal health-policy expert, was a key consultant in the design of both plans. The plans also share supporters and opponents. Most conservatives oppose both. Most liberals, including President Obama, praise both. The only people who like one but not the other are, again, Romney and his people.

Romney has a reputation for being willing to say anything to advance his political career, but one comment he made in a mid-May health-care speech cannot be doubted: He believed that his health-care plan was in the best interests of Massachusetts in 2006, and he believes it now. For a right-leaning businessman with no conservative philosophical roots, no great familiarity with the range of conservative thinking on health care, and no deep skepticism about the way politics and bureaucracies work, the plan must have had strong appeal.

The mandate would force people to behave responsibly: No more would people be able to pass their costs to the state by going without insurance and getting care from emergency rooms required by federal law to treat them. A “connector” or “exchange” would ingeniously allow for the growth of an individual market within the constraints of a federal tax law that favors employer-based coverage. Employers would give their employees money, and they would then choose among insurance plans offered by private companies through the connector. The federal government, through Medicaid, would relieve Massachusetts taxpayers of some of the costs of increased coverage. Romney could tell himself that the plan fostered competition and kept the private sector involved if not in charge. And while most conservative health-care experts were lukewarm, at best, about the proposal, it enjoyed the enthusiastic support of the Heritage Foundation, which had long favored (and had to some extent originated) many of its elements.

By the time he ran for president in 2008, conservative criticisms of the Massachusetts plan were getting louder. Romney dealt with the objections by proposing a national plan that was not open to them. His federal plan had no mandate and no major Medicaid expansion. He was careful to note that the state law was not perfect, some of its imperfections having been imposed by a Democratic legislature over his veto. Romney’s main message was that his plan had worked well for Massachusetts and might well serve as a model for other states. But those states might improve on the model, or choose a different path.

Romney’s position got trickier in 2009, as President Obama and the Democrats advanced their own health-care bill and Republican opposition to it grew. For much of the year Romney emphasized that the Democratic plan contained something the Massachusetts law didn’t: a “public option” whereby the federal government would directly provide health insurance to anyone who wanted it. But congressional negotiations killed the public option, and the plan was left looking very similar to Romney’s. Conservative voters for the first time began to think about a government mandate to buy health insurance — and instantly disliked it.

Since Obamacare passed without a public option, Romney has distinguished between his plan and Obama’s on two grounds. He repeated his case in a mid-May speech on health care. First, Romney differentiated his plan by pointing to Obamacare’s funding mechanisms. Obama cut Medicare, at least on paper, to fund his plan. As a governor Romney couldn’t do that, and he now says he opposes “diverting” Medicare funds that way. Obama raises various taxes, too, which Romney opposes. (It was Romney’s successor who raised taxes to pay for the health law.) Second, his plan is a state plan rather than a national one: an expression of American federalism rather than an assault on it. “A state solution to a state problem” is how he put it in his speech. He continues to support federal legislation that most conservatives would like; indeed, his latest proposals are slightly more conservative than the ones he advanced in 2008.

Politically, these defenses are only slightly better than nothing. The first one sidesteps the part of the Massachusetts plan that most bothers conservatives: the individual mandate it shares with Obamacare. The second argument will appeal to some conservatives. A state mandate does not raise the constitutional concerns the federal one does. But conservatives who consider the federal mandate incompatible with individual liberty will not find it much more congenial at the state level. The mandate, by the way, is also the most unpopular part of the law with the public at large. That is not an issue Romney would be able to bring up against Obama as the party’s nominee.

Even after his latest speech, the health-care issue remains extremely dangerous to Romney for several reasons. It exacerbates the character issue. He cannot repudiate the plan because he already flip-flopped on so many issues during the 2008 race, including abortion, guns, immigration, and gay rights. But defending the plan makes him look slippery, since the only way he can do it while running for the Republican nomination is to pretend that it is nothing like Obama’s law.

The unpopularity of the law among Republican primary voters also means that Romney cannot brag about his main legislative accomplishment as governor. Take it out of the picture — which is the best-case scenario for Romney — and primary voters are left looking at a rich, smooth former governor of Massachusetts who cannot point to any big success in office.

The early results of the Massachusetts law are not especially helpful to Romney, either. Yes, the proportion of Massachusetts residents without insurance — already small before the law — has gone down a little bit. But wait times to see a doctor remain long and premiums are still rising faster than the national average. Emergency-room visits haven’t dropped as promised. The exchanges, instead of promoting free markets, are on the verge of connecting price controls to insurance policies. The law’s popularity in the state is falling. More bad news for Romney: Conservatives making the case against Obamacare are using the Massachusetts example as a warning of what is to come.

Romney’s explanations are, in aggregate, more inadequate than they are individually, because their multiplicity suggests he has a big mistake to defend. And then there is this exchange, from a few weeks after Obamacare passed. The president cited Romney’s law in defending his own. Romney, in response, noted that Obama had previously accused Republicans of having no ideas. He said that the president could not have it both ways. He added, “If ever again somewhere down the road I would be debating him, I would be happy to take credit for his accomplishment.” Taking credit for Obamacare. If any other candidate had said it, one would have assumed that he was drunk.

The issue, finally, is a dagger aimed at the heart of the coalition that Romney wants to build to win the primaries. It appears that this time around Romney is not trying to run as the movement-conservative candidate but instead as an establishment man. To do that he has to unite pragmatic business-oriented conservatives and more ideological economic conservatives. Both groups listen to such voices as the editors of the Wall Street Journal — who are attacking Romneycare with a ferocity they usually reserve for left-wing Democrats.

Some observers insist that Romney can overcome this problem relatively easily. He is still doing much better than Tim Pawlenty or Mitch Daniels in the polls. Pollster David Paleologos found that he had a 25-point lead in the New Hampshire primary and that a majority said that the Massachusetts health-care law would have “no effect” on their vote.

Romney gave his health-care speech because he knows that these numbers are misleading. He is better known, nationally and in New Hampshire, than his rivals, which is a real asset but a diminishing one. More important, none of his rivals have yet run ads attacking the Massachusetts plan or quoting Obama’s praise for it or Romney’s “I would be happy to take credit.” Romney hasn’t participated in a candidate debate where the resemblance of Romneycare to Obamacare was an issue. (The lines write themselves. “Governor, you say that the legislature made the bill worse. So why did you still sign it?”) There is no reason to think that the damage this issue can do to Romney has already taken place.

It will, in short, be extremely hard for Romney to win his party’s nomination without solving his health-care problem. So how does he solve it?

He doesn’t.