Giuliani Ties Romney to 'HillaryCare'

Oct. 4, 2007 — -- To enhance his aura as the GOP's national front-runner, Rudy Giuliani makes a point of ignoring his Republican rivals and concentrating his attacks on Democrats.

But below the radar, Giuliani is working to tie former Massachusetts Gov. Mitt Romney, his party rival, who sits atop the polls in Iowa and New Hampshire, to the health-reform package recently unveiled by Sen. Hillary Clinton, D-N.Y.

The stakes are considerable: If Giuliani succeeds in raising doubts about Romney's free-market credentials, the former New York mayor might blunt any advantage Romney receives from being the more socially conservative candidate.

"There's a good reason why Mr. Romney didn't roll out his Massachusetts plan to the nation," Giuliani adviser Sally Pipes wrote recently in The Wall Street Journal. "Being based on mandates, new bureaucracy, increased regulation and wishful thinking, it looks a lot like Hillary Clinton's: that's not healthy for anyone."

The Giuliani camp is not alone in seeing substantial overlap between the plan Romney approved as governor and Clinton's latest effort at reform. Although the former first lady's proposal includes a Medicare-like option not present in Romney's Massachusetts plan, which focused strictly on private health insurance, they both include a requirement that all individuals obtain insurance.

"What [Romney] did in Massachusetts is not that far from where [Clinton] is," said Robert Blendon, who directs Harvard University's program on publican opinion and health policy. "He was different as governor than he is now as a presidential candidate."

Blendon says Giuliani's latest line of attack is a natural one for him to make given the antipathy that many conservatives feel toward government mandates.

"Conservatives don't like the idea of requiring people to do something they really don't want to do," said Blendon. "The individual mandate polling that's been done shows conservatives are much less likely to like a proposal that includes such a requirement."

"From a conservative point of view," he added, "I don't think it would matter" that Romney imposed a mandate at the state level and is not proposing to do so nationally.

The Pipes letter, which was published in The Wall Street Journal on Friday, "thanked" Romney for "returning to sanity" with his mandate-free national proposal.

It does not, however, reveal that she is one of five "key advisers" to Giuliani on health policy.

Instead, The Wall Street Journal identified her as president and CEO of Pacific Research Institute, the free-market think tank she runs in San Francisco.

The lack of transparency sparked indignation in the Romney camp.

"There seems to be an urgent need for the mayor to hide behind the erroneous attacks of Ms. Pipes, particularly since the mayor hasn't offered a health-care plan with any level of specificity," said Romney spokesman Kevin Madden. "The mayor's plan isn't really one. It's just a series of bullet points with no substance."

The Giuliani campaign declined to discuss its coordination with Pipes on the letter. But the former New York mayor's spokeswoman stood by the underlying critique.

"No one knows better than Sally Pipes that government-mandated health care doesn't work," said Giuliani spokeswoman Maria Comella. "It's merely a slippery slope to socialized medicine."

Although an individual mandate can be politically controversial, that aspect of Romney's Massachusetts plan was defended by a leading conservative thinker on health policy.

"Romney was making a very, very good fundamental point," said Robert Moffitt, the director of the Center for Health Policy Studies at the conservative Heritage Foundation. "Health care is not free. There is no such thing as free health care. We all pay for the health care of those who do not have coverage."

"There is a mandate right now," he added. "There is a mandate on each and every taxpayer, in a sense, to pay for the care of those who do not take care of themselves" and who end up in emergency rooms without the ability to pay.

The Romney camp has responded to the Giuliani onslaught by not only challenging the enrollment statistics and cost estimates used by Pipes but also by accusing the former New York mayor of offering an inadequate health-care plan.

"The governor's plan details federal incentives to deregulate and reform state health insurance markets," Madden said. "It redirects federal spending on 'free care' in a way that helps the low-income purchase private insurance.  It also institutes HSA [health savings account] enhancements and full deductibility of qualified medical expenses."

Despite Romney's effort to draw a sharp contrast between his national plan and that of Giuliani, most experts see the two plans as more alike than they are different.

While Romney's allows Americans to deduct the full cost of health insurance and out-of-pocket medical expenses as long as they carry a catastrophic insurance plan, Giuliani's plan allows families to deduct $15,000 for the cost of health insurance and individuals to deduct half that amount.

"On the biggest item on health-care insurance policy, which is the tax treatment of health care, their approaches are broadly similar," said Moffitt.

While Moffitt considers both the Giuliani and Romney plans to be dramatic improvements on the status quo — both addressing the tax code's current discrimination against those who do not buy their health insurance through an employer — he is disappointed that their proposals are structured in such a way that they will not aid more people.

"I would have preferred a national tax credit system," said Moffitt. He says Giuliani and Romney "are talking about basically promoting standardized deductions. They are broadly similar to the policy agenda that has been outlined by President Bush with a universal standard deduction."

A refundable tax credit, he says would "be more effective in reaching lower-income people who do not have health insurance. To the extent that you don't have direct tax liability you would still be given assistance." The deductions offered by Giuliani and Romney, by contrast, would only aid those with a direct federal income tax liability.

The attack on Romney via The Wall Street Journal fits into a broader Giuliani strategy.

While the former New York mayor stands to Romney's left on social issues like abortion and same-sex marriage, Giuliani is aiming to use Romney's Massachusetts record to get to Romney's right on economic issues.

"While you see this moderate on the social issues," Blendon said of Giuliani, "he feels very strongly that he wants to have a plan that really says to conservatives: I will do something on health care. But I will really honor the principle of tax cuts; free markets; less regulation; no government involvement."

"So, there is sort of a double signal there," Blendon added. "Here is my plan, here are the details. And the other is: Here is a signal that on economic issues, I will not let you down on the conservative side."

ABC News' Jacqueline Klingebiel and Mike Chesney contributed to this report.