Beware Of Romneycare
I told you Mitt Romney’s health care scheme in Mass. was going to be trouble. Here’s Betsy McCaughey in the Wall Street Journal laying out the reasons why:
Everyone should have access to health care. Massachusetts aims to achieve this goal with a double mandate: All residents must have health coverage (Section 12) and all employers with more than 10 workers must assume ultimate financial responsibility if employees or their immediate family members need expensive medical care and can’t pay for it (Sections 32, 44).
What is the impact on individuals? The state will offer subsidies to help low income residents pay for coverage (Section 19), but most of the uninsured earn too much to be eligible. An individual making $29,000 or more would probably have to pay the full cost or find a job that provides health insurance. Individual coverage costs about $3,600 in Massachusetts — a hefty bill. Moreover, under the new law, individuals purchasing their own insurance must buy HMO policies. Preferred provider plans (PPOs) — which give you more ability to choose your own doctors and treatments — are not allowed (Section 65).
The impact of this law on employers is substantial. The original bill required employers with more than 10 full-time workers to provide all of them (and their families) with health insurance or to opt out of that requirement by paying a $295 annual tax per worker into a state fund. This modest penalty was highly publicized by the bill’s supporters as proof that the bill would not be a heavy burden on businesses. Nevertheless, Gov. Romney vetoed it, perhaps to display his Republican credentials as a tax-cutter.
The Massachusetts House of Representatives overrode the veto — but the reality is that the $295 penalty is small potatoes compared with the other obligations in the law. Say, for example, you open a restaurant and don’t provide health coverage. If the chef’s spouse or child is rushed to the hospital and can’t pay because they don’t have insurance, you — the employer — are responsible for up to 100% of the cost of that medical care. There is no cap on your obligation. Once the costs reach $50,000, the state will start billing you and fine you $5,000 a week for every week you are late in filling out the paperwork on your uncovered employees (Section 44). These provisions are onerous enough to motivate the owners of small businesses to limit their full-time workforce to 10 people, or even to lay employees off.
This part made me gag.
What else is surprising about this new law? Union shops are exempt (Section 32).
Yup. Gotta pander to those union lobbyists.
As I’ve said before, this health care scheme does absolutely nothing to alleviate the true problem with health care, which is the high cost of health care. In fact, it goes a long way toward perpetuating the problem by forcing individuals and businesses in Mass. to lock into the system of insurance that caused the sky-high health care prices in the first place.
