what is Romney Care?

[charliebrown]

It gets trashed all time by the right.

What is it? I have heard it has an insurance mandate, and a state run public exchange for those who cannot find / afford private insurance.

Is it working?
What happened to the premiums/coverage levels for private plans after it was implemented?
What is life like in the public exchange? What are the premiums for a family plan with what deductables?
Is the service different depending upon what insurance you have?
Is the state under severe financial duress because of it?

It this a fore-shadow of Obama care when it is fully implemented?

Are there any members here who are living under Romney care and would like to comment?

[Ellen Z]

Re: what is Romney Care?

Massachusetts Health Care Reform: Three Years Later - Fact Sheet

www.kff.org/uninsured/upload/7777-02.pdf
This fact sheet describes the basic components of the landmark Massachusetts health reform law, and its effects three years after the law was passed. I couldn’t locate anything more recent.

Massachusetts Data

http://www.statehealthfacts.org/prof...nce.jsp?rgn=23
This page has tons of health-related data (as well as data on state demographics, economy, and links to current health-related headlines) compared to national data.

Click on the box in the upper left for similar data on any other state. Click on the categories on the left (the plus signs) for more data than most human minds can absorb.

According to that page, Massachusetts now has 5% uninsured while the U.S. nationally has 16% uninsured.

[charliebrown]

Re: what is Romney Care?

Thanks for posting this. Some things I see is absurdly low prices for premiums. I estimate my plan to cost about 12,000 a year for family coverage, with a cap of 5000 out of pocket. Just like the SS, and medi-care we will have to wait 20 years to see if the state is bankrupt. On the good side with employment out look not so great, it would provide a safety net. I can't afford 15,000 a year for too many years if I had to pay out of pocket for health coverage myself.

And what does the insurance cover? Will it cover giant bills for cancer, heart disease, diabetes?

I hope someone from Mass who has interacted with the system will post.

[lektrode]

Re: what is Romney Care?

the best guy for this answer would be dcarrigg.
not that he's in MA, but he knows where the data is.

oh d-ceeeeeee?

[quigleydoor]

Re: what is Romney Care?

I saw this article in FT.com. Hope it sheds some light on it.

Romney silent on his healthcare success
By Alan Rappeport in New York
March 21, 2012 5:28 pm
http://www.ft.com/cms/s/0/6822b3c4-7...44feab49a.html

Mitt Romney does not brag about it much these days, but almost six years since he signed healthcare reform into law as governor of Massachusetts, his plan to require residents to buy health insurance has largely been a success.

Most polls show that about three in four state residents support the law, which became a model for the national health reform act passed two years ago. Like the national law, Massachusetts mandates all residents to buy insurance, creates an exchange for people and businesses to shop for it and offers subsidies to those that cannot afford to pay.

Healthcare reform will return to centre stage next week when the US Supreme Court hears opening arguments over the Obama administration’s signature legislation, which narrowly passed Congress in 2010. On trial will be the “individual mandate”, which in 2014 would require everyone to purchase insurance, unless the judges strike it down.

The outcome of the case, expected in June, could set much of the narrative of November’s presidential election.

Barack Obama insists that access to healthcare is every citizen’s right. The president’s Republican opponents condemn the mandate as a “big government” infringement of personal liberty. Polling has shown voter distaste for the law, but the administration contends that provisions to expand insurance access to young adults and sick people are popular.

The constitutionality of the mandate has never been challenged in Massachusetts, which is the only US state that requires the purchase of insurance and will be a case study as the court considers the effect of removing the rule.

Meanwhile, for many in the state who helped Mr Romney craft his healthcare overhaul, national controversy over the mandate and the degree to which the former governor has distanced himself from the law he drafted are surprising.

“It was a conservative brainchild with a Republican governor taking ideas from a conservative think-tank,” says Jonathan Gruber, an economist at Massachusetts Institute of Technology and an architect of the state and federal reform plans. “If Romney was a Republican 10 years ago, this really would have been a feather in his cap.”

John McDonough, an academic at Harvard’s school of public health and former director of Health Care for All, a lobby group that helped pass the law, says: “It’s staggering that he takes credit for the Massachusetts law and wants to deny the rest of the country the same kind of protection and security that Mass residents enjoy now because of his labours.”

Mr Romney, whose campaign did not respond to requests for comment, has defended the Massachusetts policy but says mandates should not be imposed at the national level.

“Everyone has a requirement to either buy it or pay the state for the cost of providing them free care,” Mr Romney said during a recent debate. “Because the idea of people getting something for free when they could afford to care for themselves is something that we decided in our state was not a good idea.”

Critics of a national health insurance mandate argue that the Massachusetts policy would play out differently in different states. They also say it has failed to curb medical costs and that expensive emergency visits have not reduced.

However, research points to many successes. A study by Charles Courtemanche and Daniela Zapata for the National Bureau of Economic Research finds that greater insurance coverage has led to better physical and mental health among Massachusetts residents. Improvements were notice*able among minorities and the poor, who previously lacked insurance.

Mr Gruber noted in a study last year that 98 per cent of Massachusetts residents had health insurance and that many of the biggest fears associated with the plan had not materialised. Waiting times for physicians had declined, premiums in the individual insurance market have fallen despite an increase nationally, and employers have not stopped offering insurance as a benefit.

For Matt McGinity, chief executive of a computer company in Massachusetts, the state mandate has led to savings. Five years ago when his insurance rates were about to jump 20 per cent, the state’s insurance exchange helped find a cheaper option, saving thousands of dollars a year.

“Instead of people paying 110 per cent of what they owe, it’s more like everyone pulls their own weight,” Mr McGinity said.

The state has so far been able to manage the weight of the additional costs on the system. According to Michael Widmer of the non-partisan Massachusetts Tax Policy Institute, the subsidies that the state pays each year to make insurance affordable to everyone have been larger than expected but still only represent about $450m a year on a $34bn annual budget.

Health experts in Massachusetts say compliance with the insurance mandate has been rising each year, but warn that without the mandate, which reduces premiums by spreading costs, the policy would unravel as people with pre-existing medical conditions flooded the market and prices would soar.

In the 1990s, nine states required insurers to guarantee coverage for people with pre-existing conditions without a state mandate and six of them ultimately repealed those rules because premiums rose and healthy people dropped their coverage.

“The mandate has been an extraordinarily important part of our health reform structure,” said Glen Shor, director of the Massachusetts Health Insurance Connector, the state’s insurance exchange.

Sidebar: Romneycare v Obamacare

Romneycare (Massachusetts health reform of 2006) and Obamacare (Patient Protection and Affordable Care Act, 2010) both require all citizens to purchase health insurance or pay tax penalties.

Romneycare offers state subsidies to residents with income up to three times the Federal poverty income level. Obamacare offers tax credits to citizens with income up to four times the poverty income level.

Romneycare offers individual policies through the Commonwealth Health Insurance Connector. Obamacare offers individual policies through exchanges set up by states or the US federal government.

Romneycare offers gold, silver, bronze and young adult plans. Obamacare offers platinum, gold, silver, bronze and young adult plans.

Romneycare allows adults to stay on their parents’ health insurance plans for up to two years after they graduate from school until they turn 26. Obamacare makes employers and insurers cover all young adults on their parents’ plans until the age of 26.

Romneycare makes businesses with more than 10 workers that fail to offer health insurance pay a penalty. Obamacare penalises companies with more than 50 workers if any of them receive a tax credit to buy insurance.

Romneycare and Obamacare both tie hospital payments to the quality of care they provide.

Source: Families USA; John McDonough, Harvard School of Public Health

[Polish_Silver]

Romney care and what's really wrong

Romney Care:

There was a New Yorker article on Romney care by Ryan Lizza.

I'll summarize the content.

1) The article was very pro Romney care and Obama care.

2) The article admitted that almost all the money for Romney care came from the federal government, not from MA taxpayers, at least in the first years.

3) The article admitted that Romney care did not reduce costs "which continued to rise".

4) The article did not even mention whether public health improved or not.

In other information, Obama's staff has admitted there was no reason for an individual mandate (Austan Goolsbee).


The usual argument of "adverse selection" is only applicable to an insurance business model.

Here is just one alternative to "individual mandate":

1) Offer free preventive care from general revenue. Initially, this could be limited to vaccinations and annual physicals.

2) If a person consumes medical care without paying, enroll them in the bureacracy at that time. If they have sufficient income, garnish thier wages, but call it "an insurance premium". If they don't have sufficient income, then pay for basic care from general taxes.

Ideally, most people would have a medical savings account, which could fund preventive care. Rather than "use it or loose it", the accounts would
roll over, and if the balance become large, the person could spent it on flute girls.

You always have these two problems:

1) Deciding who can pay, and who should be subsidised.

2) Collecting from those who can pay.

The "individual mandate" does not solve either of these problems. What it does do is enroll everyone in a private sector health insurance plan.

The biggest failure of Romney care is it's complete inability to reduce costs, only shift them from patients to taxpayers.

More Recent atlantic monthly article on health care gives statistical data that MA health is improving because of Romney care.

So Romney care does seem to succeed at getting some un-insured people medical care that they otherwise wouldn't get.

" But the researchers estimate that improving a resident's health from poor, fair, or good to very good or excellent took $9,782 in government spending."
That is $185/week, and seems like a lot. I'd like to know what the comparable is in Japan.




Costs are so high in this country for these related reasons:

1) The insurance paradigm gives patients & physicians incentive to consume as much as possible, regardless of price.

2) Physicians salaries are based on treatments, not prevention. (AS a healthy person, I am giving my doctor almost no business. He has every incentive to get me obese, so that I buy all kinds of care for diabetes and heart disease).

3) Care is monopolized by hospitals and large institutions, which have a large bureaucratic overhead. In central europe and taiwan,
you can go to "hole in the wall" clinics which are often staffed part time by one physician. These are often within walking distance of your home or work.
They do real medicine there. Sometimes there will be a microscope on the table!

4) Lack of price discovery. Usually the clinic cannot tell you how much a treatment costs, even if it is completely routine. This is caused by the insurance
system. I once got charged $700 for a syphilis test, which in other countries would cost $20 or less.

In Japan, the price of virtually every treatment is published in a book, and physicians are not allowed to charge more. Do they get poor quality
health care?

[quigleydoor]

Re: Romney care and what's really wrong

Great summary, thanks.

[shiny!]

Re: Romney care and what's really wrong

Costs are so high in this country for these related reasons:

1) The insurance paradigm gives patients & physicians incentive to consume as much as possible, regardless of price.

2) Physicians salaries are based on treatments, not prevention. (AS a healthy person, I am giving my doctor almost no business. He has every incentive to get me obese, so that I buy all kinds of care for diabetes and heart disease).

3) Care is monopolized by hospitals and large institutions, which have a large bureaucratic overhead. In central europe and taiwan,
you can go to "hole in the wall" clinics which are often staffed part time by one physician. These are often within walking distance of your home or work.
They do real medicine there. Sometimes there will be a microscope on the table!

4) Lack of price discovery. Usually the clinic cannot tell you how much a treatment costs, even if it is completely routine. This is caused by the insurance
system. I once got charged $700 for a syphilis test, which in other countries would cost $20 or less.

In Japan, the price of virtually every treatment is published in a book, and physicians are not allowed to charge more. Do they get poor quality
health care?

I disagree partially on #2. Doctors are about 26 years old when they graduate med school. Then they spend years earning low wages as Residents. During their residency they must begin paying off their medical school debt which might exceed $250,000. An internist has a four-year residency, a cardiologist or brain surgeon residency is many years longer. So a doctor is 30-35 years old before they start earning a high salary, but they still have that huge debt to pay off. People who go into easier fields begin their careers with much lower debt and maybe a decade more earning years.

[c1ue]

Re: Romney care and what's really wrong

Costs are so high in this country for these related reasons:

You're also missing the fact that in most socialized/national health care nations, every consumer has the alternative of going to a government worker for health care.

This is one reason why price discovery is so easy - the consumers know they can go to the state and get treatment for a low/free/fixed price.

The existence of the public health care workers forces private providers to be more transparent.

[dcarrigg]

Re: what is Romney Care?

the best guy for this answer would be dcarrigg.
not that he's in MA, but he knows where the data is.

oh d-ceeeeeee?

Reporting for duty.

The thing to realize with Romneycare - and the related Obamacare - is that they create 3 functional levels for plans. They are bronze, silver, and gold. Gold plans are more like the typical large corporation or government healthcare plans people think of today.

What does all this mean?

Let's say you're a male born on Jan 1, 1970 looking to buy insurance just for yourself:



Let's say you're the same person looking for a family plan for a family of 4:



For the cheapest gold plan - the one listed above - here's the detailed list of benefits and costs. For the cheapest bronze plan - the one listed above - here's the detailed list of benefits and costs. Co-insurance can get expensive on the low-end plans. Out of pocket maxima include co-pays, deductibles and co-insurance, but do not typically factor in co-pays of less than $100 for doctors visits, prescription drugs, or outpatient procedures. Still, the caps at least should work to prevent bankruptcy should something really bad like cancer hit.

From here on in, I'm spouting numbers from memory. They're bound to be in the ballpark, but I wouldn't go preaching them as gospel.

Now if you're that individual making under $33k, they subsidize it, so you pay less. If you're that family making less than $67k, they subsidize it, so you pay less. But the subsidized programs offer one choice usually, and it is negotiated with the state.

Here's a list of copays and procedures. Here's a price chart of monthly premiums for that plan. It's a sliding scale based on Federal Poverty Level, which varies by family size. It slides you right down into Medicaid at the bottom. The most you pay is around $200 per month, and that's if you're an individual pulling in between about $26k and $33k.

In polls, somewhere around 2/3 of people are happier with the new system than they were with the old one. Costs for the state got out of hand for the first couple of years, but then leveled off fairly quickly. One always has to remember that states pay for the uninsured that go to the hospital anyways (uncompensated care), so it's usually not all that much more expensive to get people insured. All things considered, when you take total added costs minus state uncompensated care costs, you end up with about a $150M-$180M per year cost to the state (about 0.4% of state revenues). So it really doesn't bankrupt anyone. The Federal law is a bit different, as there are greater incentives and penalties for business owners than in MA.

Speaking of penalties, the mandate in MA hits you with about a $1,200 tax penalty if you don't buy into the system. At the low end, that did wonders for people signing onto Medicaid who were eligible anyways, but just didn't bother to fill out the paperwork. If you look at the numbers, the mandate also seems to have convinced middle-income people with modest means to purchase more of the high-deductible, high-copay plans, where in the past they were typically either purchasing the equivalent of 'gold' plans or going without insurance. Put another way, it took the stigma off the cheap plans.

All in all, it went surprisingly well. I don't think anyone up on Beacon Hill at the time thought they'd get away with as little backlash as they did. But they also had some very smart people working on it, and went to great lengths, even with advertising and marketing dollars, to explain it to everyone well before hand, through the process, and even today. Check out www.mahealthconnector.org. It makes it relatively easy to comparison shop (and it's where I got the first two images here).

That being said, having known a couple of small business owners on the ground, I know that people were dodging the mandate in the beginning too. I fear the danger in that, because I'm not so sure there isn't a tipping point at the beginning where mandate-dodging gets so widespread that ignoring the law becomes the norm. MA is a little different than the country as a whole. It's a lot more dense, and therefore, easy to reach people.

The other thing to watch for is that states will set up their own exchanges. Some states will probably do a very good job. Others will probably not. There may even be some governors who try to refuse to do it for a while.

None of this reduces healthcare costs to the consumer, even if they find a way to reduce the costs on the taxpayer side of the ledger. The national plan has that 40% excise tax on 'cadillac plans.' That's the only cost control. It will functionally cap plans at $850 per month for individuals and $2300 per month for families starting in 2018. The trick here is that costs will then be indexed to the 'medical inflation rate,' which tends to hover about 3% below the real rate of cost inflation in healthcare. It should slow down cost increases to about 1 or 2 points over the CPI moving forward, which, while not sustainable, is better than we are doing now.

[Polish_Silver]

Re: Romney care and what's really wrong

Price transparency is a major issue. But grocery stores and radio shack offer it without the presence of competing government services.

But no one buys a stereo or banannas using insurance.

Because care is monopolized in large hospitals, it is easier for them to avoid competition by hiding prices.

If a single clinic were to post prices on the internet, it would attract business from all the uninsured people.

Eventually, that will happen. However, I am not holding my breath. (Blood tests are falling rapidly in price, due to

competition over the internet.)

What we need is something to introduce more competition!

People haggle with car dealers over $300 on a $15k car. The Dealers are bending over forwards to create 2% of price opacity in thier products.

[Polish_Silver]

Re: what is Romney Care?

Everyone has a requirement to either buy it or pay the state for the cost of providing them free care,”

They never explain why a person who pays for thier own care should be required to pay for premiums. We are subsidising poor people
through general taxes anyway. So why should I pay an "insurance premium" on top of my taxes? Because that's what the insurance companies want. They have national political reach. I don't by my cars, houses, or food using insurance, so there is no reason I should purchase medical care that way either. If a big expense comes up, I pay it out of savings, or by borrowing. I can use insurance for catastrophic rare events, analogous to fire insurance on a house.

[charliebrown]

Re: what is Romney Care?

This was really helpful. It appears that the costs and benefits run about the same as my employer's bronze high.
As other posters have said no cost containment and no transparency. I just had a small lesion removed from my arm.
In the dr's office, only local anestisia used, tissue sent to pathology. 1/2 hour of time spent $2000.00.

[charliebrown]

Re: what is Romney Care?

The way that billing is going up, everything is major. My routine appendectomy 2 years ago was billed to insurance at 50K. If my appendix would have burst, It would be in the 100K+ range. Now my kid needs minor surgery too, and I expect another 50K bill. no insurance and two minor surgeries and I'm wiped out. If you have no insurance the dr. or hospital will charge you top line retail pricing. I know I have been there and tried to negotiate, it is very hard hill to climb. You need insurance to get the negotiated rate. I know it is a scam, but you must play, unless you have no assets, or leave a charmed life.

[Polish_Silver]

Global arbitrage vs US health care!

American Prices are out-fing-rageous!

If I needed anything costing more than $5k, I would be on the first plane to Taiwan, Mexico, Czech republic, anywhere but USA!

My wife says doctors in the Czech repubic are highly competent, and I can vouch that women there are very hot!