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Romney Says He Solved Health Crisis ‘At The State Level,’ But Admits ‘The Feds Fund Half Of It’

By Igor Volsky on April 13, 2010 at 11:40 am

"Romney Says He Solved Health Crisis ‘At The State Level,’ But Admits ‘The Feds Fund Half Of It’"

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Yesterday, Bill O’Reilly challenged Mitt Romney on the success of RomneyCare, forcing the Governor to defend his plan and admit that far from finding a state solution to a state problem — as Romney always argues in his stump speeches — Massachusetts relied on federal dollars to expand health care coverage.

“Actually, from the beginning the plan was a 50/50 deal between the federal government and the state government,” Romney said, when O’Reilly claimed that state spending on health care was out of control. “The Feds fund half of it, they have from the very beginning,” he repeated, while maintaining that Massachusetts solved “a problem at the state level.”

O’Reilly wasn’t buying it:

O’REILLY: You know me. I’m a simple man. Okay? You say you solved the problem in the state, but depending on 50 percent of your funding from the Feds.

ROMNEY: As we did from the beginning.

O’REILLY: Okay, but I’m just telling you, I don’t know if you solved the problem or the people in Idaho solved it.

ROMNEY: No, but what we did is we took the money the Feds used to send us–

O’REILLY: Yes.

ROMNEY: –to give to the hospitals that were giving out free care. The hospitals were doing that before. And we said, look, can we take that money that you give to us that we give to the hospitals and instead of giving it to hospitals–

O’REILLY: You’ve spread it around.

ROMNEY: We’re going to use it to help people buy insurance.

O’REILLY: Okay. One more and–

ROMNEY: It was not a new burden on the federal government. It was a redirection of what they’ve been doing before.

Watch the exchange:

National reform is “going to be a huge entitlement, which is the federal government taking power away from the states,” Romney maintained. “We solved our problem at the state level. We did it without raising taxes. That’s the key.” But this isn’t very accurate. First, Massachusetts did tax insurers, hospitals, and employers (as well as individuals who refused to purchase coverage) to fund health reform. Second, Romney is pretending that Massachusetts decided to one day solve “our problem at the state level” by simply rerouting existing federal funds to pay for the changes. In reality, the federal government pressured the state to change its Medicaid program or lose $385 million dollars, thus helping bring about reform. The federal dollars Romney used to expand coverage came with strings attached — the state had to shift federal resources from supporting individual hospitals to funding health insurance coverage for uninsured individuals — and the state had to seek the federal government’s seal of approval.

The same thing is true about the federal health care bill. It provides states with federal funding to expand the Medicaid program, establish high-risk insurance pools, set up exchanges and then gives states some leeway in implementation. The health care law establishes federal standards and is obviously much broader in scope than the Massachusetts plan, but it’s predicated on the principle that states simply aren’t capable of reforming something as large as health reform without federal assistance. Romney should know that better than anyone.

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