Massachusetts Gov. Mitt Romney (R) on Wednesday is expected to sign a bill that aims to expand health care coverage to nearly all of the state's uninsured residents, but he has indicated he will veto a fee on certain businesses that do not provide health insurance, the Boston Globe reports (Phillips/Helman, Boston Globe, 4/12). The bill, which was approved by the state Legislature on April 4, would require all residents to purchase health insurance by July 1, 2007, and would create a low-cost, state-subsidized health insurance program for residents with incomes up to 300% of the federal poverty level. The legislation would also require employers with 11 or more workers to provide employee health coverage or pay a fee of $295 per employee (Kaiser Daily Health Policy Report, 4/5). Romney in an op-ed column in the Wall Street Journal on Tuesday wrote that he blamed his "Democratic counter parts" for including an "unnecessary and probably counterproductive" fee in the legislation, adding that he would take "corrective action" to reject the fee. Romney also "raised a subtle objection" to the bill's expansion of Medicaid, the Globe reports. According to the Globe, a veto of the employer fee "would be easily overridden by the Legislature, because of the large majority of Democrats," but "Democratic leaders were nonetheless upset that Romney ... would not detail his objections fully." The fee "is widely considered a centerpiece of the legislation, because it would raise about $45 million a year and encourage some businesses to provide coverage," the Globe reports (Boston Globe, 4/12).

Comments
Romney said, "It's a very small feature of this bill. It's a very insignificant and unnecessary and, in some respects, counterproductive element of this bill. It applies to a tiny number of employers, and it raises a very small amount of money relative to the scale of this entire proposal. So I don't think it's necessary" (LeBlanc, AP/Long Island Newsday, 4/12). State Rep. Peter Koutoujian (D) said, "The signing should be a celebration, but I find it a little discomforting that we're not in the dialogue about what the governor's concerns are." State Sen. Mark Montigny (D) said, "What Romney is really trying to say is that he was for it before he was against it," adding that Romney did not raise objections to the fee when the bill became public. He added, "Now he wants to join [conservatives in other states] against us. He is running away from Massachusetts, and he is now representing the rest of the nation against Massachusetts." Jeffrey Berry, professor of political science at Tufts University, said, "Romney has gotten what he wants from the Democratic legislative leaders. Now he can address another constituency, which is now more important to his future, the conservative wing of his party." Michael Widmer, president of the Massachusetts Taxpayers Foundation, said, "There is a broad understanding in the business community that the assessment is tied to equalizing the burden of state's providing free health care to workers not covered by insurance and that it was critical to achieving this major reform" (Boston Globe, 4/12).

Report
State efforts such as the Massachusetts health reform legislation are vital to improving the U.S. health care system, according to a Harvard University report released on Wednesday, the Boston Herald reports. The report, from Harvard's Program for Health Systems Improvement, says that health care costs accounted for 16% of the gross domestic product in 2004, up from 12% in 1990. In addition, the researchers found that health-related bankruptcies increased 23-fold between 1980 and 2001. According to the report, the federal government has made no crucial changes to the health system because of political pressures and general mistrust. However, states can serve as laboratories for the federal system, according to David Blumenthal, director of PHSI. He said, "Massachusetts' latest reforms are not guaranteed to succeed. But whether state-level reforms succeed or fail, there is a lot that can be learned from them." The report says that the country ultimately needs national health care reform but must rely on state reform in the meantime. Blumenthal said the Massachusetts plan does not address all of the problems with health care, adding, "Ensuring access isn't sufficient because it's access to a broken system" (Heldt Powell, Boston Herald, 4/12).

The report is available online. Note: You must have Adobe Acrobat Reader to view the report.

Hospital Provision
In related news, the Boston Globe on Tuesday examined a provision "buried" in the health insurance reform bill passed last week by the Massachusetts Legislature that would provide "strong market protections" for two hospitals that "provide care for the most low-income patients in Massachusetts." Boston Medical Center and the Cambridge Health Alliance currently receive about $287 million annually --from the state's $800 million free care pool, which will be phased out under the reform bill -- for the Medicaid managed care programs they operate. Under the provision -- which was supported by the hospitals -- BMC, CHA and their Medicaid managed care plans are guaranteed to receive $287 million annually, or $861 million over the first three years of the plan. The managed care plans and two other insurers will share "exclusive rights" to cover an estimated 207,500 state residents with annual incomes lower than 300% of the federal poverty level but too high to qualify for Medicaid. The group represents between one-third and one-half of the total new insurance business that will be generated by Massachusetts' plan to cover 95% of the state's uninsured residents within three years. Senate President Robert Travaglini (D) said, "As the largest providers of free care, [BMC and CHA] are sometimes the only link to health care services for those struggling to make ends meet. During the transition we want to be sure there are no holes in our new safety net." BMC CEO Elaine Ullian said, "We have an established track record that says we can really make a difference with this newly enfranchised group. Our core mission with our health plan has been developing plans and services for people who are poor or working poor." According to the Globe, the administration of Gov. Mitt Romney (R) is studying the provision but previously has supported the market exclusivity provisions (Rowland, Boston Globe, 4/11).

Broadcast Coverage
NPR's "Talk of the Nation" on Tuesday included a discussion of the Massachusetts bill. Guests on the program included Jonathan Gruber, a health economist at the Massachusetts Institute of Technology who advised Romney and the state House on the bill (Martin, "Talk of the Nation," NPR, 4/11).

The complete segment is available online in RealPlayer.