Romneycare In Massachusetts, Six Years Later

Republicans and Democrats are eagerly awaiting the Supreme Court's ruling

June 20, 2012, 4:59 PM

June 21, 2012 -- Republicans and Democrats are eagerly awaiting the Supreme Court's ruling on the Affordable Care Act, which is expected to come down any day now. And while the court could rule in many different ways, the jist of the ruling comes down to the question of the controversial individual mandate requiring most documented residents to get health insurance, or pay a penalty.

In short a ruling upholding the individual mandate will be a victory for Obama and the Democrats, and a ruling overturning the individual mandate will be a victory for Romney and the Republicans. The irony of the ruling, as has been pointed out by Democrats, and some of Romney's opponents in his own party during the GOP primary, is that the healthcare law, including the individual mandate, was in many ways modeled after Massachusetts' health care law which Mitt Romney signed in 2006 when he was governor.

It's important to note that Romney has never taken issue with Massachusetts's law. He argues that while the law works for the state of Massachusetts, it should not be applied on a national scale.

Generally speaking, the health care law in Massachusetts appears to be working well, six years later. Some 98 percent of Massachusetts residents are insured, according to the state's Health Insurance Connector Authority, and that percentage increases among children at 99.8 percent and seniors at 99.6 percent. Another 439,000 residents have gained insurance since before the reform was passed.

The Commonwealth had a lower percentage of non-elderly uninsured residents than the U.S. average prior to the passage of the law. In 2006 the rate in Massachusetts was 10.9 percent, while the average across the country was 17.1 percent, according to the Current Population Survey.

The system is not without its flaws. Premiums remain high in Massachusetts. In fact the state has the highest individual market premiums in the country, according to the non-partisan Kaiser Foundation. Currently, per capita health care spending in the state is expected to nearly double between now and 2020- from between $10,000 and $12,000 (the current cost) to $17,872- if there is no intervention, according to figures provided by Blue Cross Blue Shield Massachusetts.

Nevertheless a majority of employers, residents, and physicians in the state have all found the reform to be beneficial.

"Overall the Massachusetts reform has gone very well and it's done everything it was designed to do," says Jonathan Gruber, a professor of economics at MIT who worked with both Romney and Obama on their respective plans.

"We lowered premiums in that market by about 50 percent relative to the national trend. Overall it's been very successful. It's not been successful in what it didn't try to do- in that it didn't try to control cost and it doesn't."

The cost of the law to the state has not been very high. The Massachusetts Taxpayers Foundation estimated that increased spending attributable to the law accounted for a little more than 1 percent of the state's budget for the 2010 fiscal year. But Gruber points out, Massachusetts didn't shoulder the burden of payment for the law entirely on their own- they had help from the federal government.

"There is nothing inherent in the economics of Massachusetts that should be singled out," said Gruber. "There's only two things that should be singled out in Massachusetts- one is we did have widespread acceptance of the mandate, which may not be true elsewhere. But the biggest thing that Romney's not talking about is in Massachusetts the federal government paid for about half of our plan. We didn't pay for it all on our own."

Gruber says that this makes it harder to argue that state's can easily adopt plans similar to the one in Massachusetts. The economic impact on a similar plan not aided by the federal government can't be accurately compared to the Bay State.

The mandate has been a big part of the reforms success, says Gruber.

"The mandate I think played a key role," Gruber said. "Once the mandate took effect you saw a bunch of healthy people coming in who weren't coming in beforehand. I think the mandate's been a critical element of that."

The Supreme Court is expected to rule on the Affordable Care Act, also known as Obamacare, by the end of the month.

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