During what was promoted as a “major” health policy address this afternoon, Mitt Romney suggested that insurers should be able to sell policies across state lines and states should design different health care reforms. But when pressed on how he could prevent healthier individuals from moving to cheaper but less comprehensive insurance based in states with fewer protections and leaving states with more rigorous regulations with sicker, more expensive patients, the best Romney could muster is — they can vote their leaders out of office before ironically making the case for strengthening safety net programs:

Q: What’s to keep states from having to race to the bottom? …

ROMNEY: The answer is, the people of that state are going to vote out of office the people who don’t do a good job. States are competing…I also think there is a recognition in this country that we’re a grand and generous people. The idea that we would ever say to people, ‘tough luck, you’re poor, you’re not going to have health care,’ that’s just not Americans. We’re going to care for one another.

Watch it:

To figure out how Romney’s deregulation scheme would really play out, it’s worth considering what happened to the banking industry following a pair of Supreme Court decisions deregulating the industry: credit card companies relocated to states with no interest rate caps and charged “what they wanted” to borrowers in states with interest rate limits. They used pricing practices “like teaser rates, to attract cash-strapped families and then…double or triple those rates without notice.”

Why wouldn’t the same thing happen in health insurance? An insurance company could establish itself in the Cayman Islands for instance — as the GOP’s health care law allowed — and sell policies to New Yorkers who are ostensibly protected by tougher regulations that may require coverage for maternity care and cancer screenings. Only in this case, an insurer could flaunt New York’s consumer protections and essentially extend the Cayman Islands’ loose regulatory policies to New York. Healthy individuals would move to cheaper plans from the Cayman Islands while New York insurers — with their more rigorous insurance regulations — would be left with sicker, more expensive patients—and higher premiums.

The bottom line is that it reads exactly like his health care plan from the 2008 campaign, which looks very similar to the GOP House alternative offered in the midst of the 2009 health care reform legislative battle and Sen. John McCain (R-AZ) 2008 campaign plan. In other words — a rehash of traditional GOP prescriptions that deregulate the insurance market without providing adequate coverage to the sickest Americans or significantly reducing health care costs. Here are five things you should know about Romney’s plan:

1. Romney says he would empower states with greater flexibility by block-granting the Medicaid program, the federal/state initiative that provides coverage to senior citizens and poor Americans. But as a recent Kaiser Family Foundation report has pointed out, converting the existing matching rate formula into a block grant would give states less money that they would have otherwise received and force local governments to cut eligibility to the program. Kaiser examined different scenarios for state responses to reduced federal Medicaid spending and estimated 31 to 44 million Americans could lose their health insurance coverage.

2. Romney would “reform the tax code to promote the individual ownership of health insurance” and “give individuals a choice between the current system and a tax deduction to buy insurance on their own.” He thinks this would create “the best of both worlds” by allowing certain individuals to leave their employer-sponsored health insurance plans and find coverage on the individual market. But this would only entice young healthy workers to buy cheaper but less substantive insurance in the individual insurance plan market place, increasing costs for sicker workers and forcing some to opt out entirely. Among those who would lose their health care are 56 million Americans with pre-existing chronic health conditions. The credits would also fail to cover the cost of comprehensive coverage.

3. Romney says that “individuals who are continuously covered for a specified period of time may not be denied access to insurance because of pre-existing conditions” — a good idea that’s made even better by the Affordable Care Act that he wants to repeal. He’s also advocating for allowing individuals “to purchase insurance across state lines, free from costly state benefit requirements.” This means that insurers would be able to circumvent consumer protections in certain states and sell bare-bone subprime policies to the healthiest (and most profitable) beneficiaries. Companies would have little incentive to do business in states that require coverage for such things as cancer screenings or have guaranteed issue protections and sell plans across the country that deny coverage altogether to high-cost cases. The Affordable Care Act includes a similar — but far better regulated — provision that allows states to form compacts in which they can establish their own regulations.

4. Romney wants to “reform medical liability” and have the federal government “provide innovation grants to states for reforms, such as alternative dispute resolution or health care courts.” The current health care law already includes similar demonstration projects, even if the Congressional Budget Office has concluded that malpractice reforms could at most save $54 billion over 10 years or only about 3 percent of annual costs.

5. Finally, Romney proposes establishing Health Savings Accounts and eliminating “the minimum deductible requirement for HSAs.” This may help some healthy people but will do little to aid Americans with expensive chronic conditions who will quickly deplete their savings accounts.

Potential presidential candidate Mitt Romney likes to say that President Obama or the Democrats passed the Affordable Care Act without learning from the experiences in Massachusetts or any other state. “People often compare his plan to the Massachusetts plan. They’re as different as night and day,” Romney said in an interview in March of 2010. “I think the President should have been more attuned to what we did in our own state, which is we allowed each state to create a solution to the uninsured in the way that the states thought best, that’s the way the Constitution intended it.”

But Obama, his closest health care advisers, and the plan itself all suggest that Romney got even more than he wished for — a law that closely resembles (but is not identical to) the structure of the so-called Massachusetts experiment. In fact, Romney’s plan contains some policies that are even more liberal (in its standard benefit design and employer responsibility provisions) than those found in the national health care law:

During an appearance on Fox News Sunday in March 2010, Romney highlighted his support for the plan’s individual health insurance mandate. “I think our plan is working well. And perhaps the best thing I can say about it, it’s saving lives. It is the ultimate pro-life effort,” he said. “We said people have to take responsibility for getting insurance if they can afford it or paying their own way. No more free riders.”

In fact, given that Romney has previously characterized his state’s approach to reform as “the ultimate conservative idea” and “a Republican way,” one wonders why he would be so opposed to repealing a national version of his successful reforms.

During a speech on health policy later this afternoon, likely presidential candidate Mitt Romney is expected to say that while Massachusetts’ 2006 health care law has been successful in expanding coverage to most residents, it should not be duplicated on a national level and lay out a proposal to encourage states to deregulate insurance markets, repeal the Affordable Care Act, and develop their own unique health care policies — establishing a patchwork of different systems across the country. Romney has argued against exporting his state’s requirement to purchase health insurance coverage since his failed campaign to succeed George W. Bush in 2007 and has spoken out against a “government takeover” of health care since he first ran for office in 1994. But until recently, Romney has also advanced his belief that encouraging Americans to take responsibility for their health care costs, rather than passing the cost of coverage to society, is “the ultimate conservative idea” and “a Republican way.” “The Republican approach is to say, you know what? Everybody should have insurance. They should pay what they can afford to pay. If they need help, we will be there to help them, but no more free ride,” Romney told Fox News’ Neil Cavuto on April 12, 2006 during a national media tour promoting his groundbreaking 2006 health care reform law.

During that same round of national media appearances — orchestrated by the Governor to sell his accomplishment to the nation ahead of his presidential bid — Romney was asked if he thought his plan for expanding coverage by requiring Americans to purchase health insurance should apply to the nation. He repeatedly either hinted or directly stated that it could or should. It’s a position he first adopted in his challenge to Sen. Ted Kennedy in 1994. At that time, Romney said he would support a mandate on a national level if universal coverage could not be achieved through other means (such as providing tax incentives to purchase care) and would have voted for a Republican alternative to the Clinton plan offered by then Sen. Lincoln Chafee (R-RI), which included a national individual mandate. In fact, as recently as December 2007, Romney said that if other stated adopted the individual mandate it would be “a terrific idea…we’ll end up with a nation that’s taken a mandate approach” and endorsed the Wyden-Bennett health care proposal, which also included a national individual mandate:

- 1994: “Opposes Clinton plan. Opposes employer mandates, but would consider implementing them down the line if universal coverage is not achieved.” [Boston Globe, 6/26/1994]

- 1994: “Romney has indicated that he would side with the moderate wing. He endorsed the crime bill and refused to back Gingrich’s jejune ‘Contract with America.’ He told me he would have backed Chafee’s health care bill. ‘I’m willing to vote for things that I am not wild with,’ he said.” [New Republic, 11/7/1994]

- 2006: “How much of our health-care plan applies to other states? A lot. Instead of thinking that the best way to cover the uninsured is by expanding Medicaid, they can instead reform insurance.” [WSJ, 4/11/2006]

- 2006: “And there may be some aspects of it that can be picked up by other states and that would be valuable for other states, perhaps even some national elements that could be adopted…Everybody in our state has to have health insurance. We`re not going to have free riders…And that`s a model which I think has some merit more generally.” [PBS, 6/5/2006]

- 2007: “I’m proud of what we’ve done. If Massachusetts succeeds in implementing it, then that will be a model for the nation.” [Newsweek, 12/2/2007]

- 2007: “I think you’re going to find when it’s all said and done, after all these states that are the laboratories of democracy, get their chance to try their own plans, but those who follow the path that we pursued will find it’s the best path, and we’ll end up with a nation that’s taken a mandate approach.” [NBC, 12/16/2007]

- 2009: “Massachusetts is a model for getting everybody insured in a way that doesn’t break the bank, doesn’t put the government in the driver’s seat and allows people to own their own insurance policies and not to have to worry about losing coverage.” [CNN, 2009]

- 2009: “It’s important for us to have a stronger message as we go forward, and I think the party does have to stand up and be able to say, ‘Listen, Mr. Axelrod, you’re wrong when you say we don’t have ideas. We have a health care plan. You look at Wyden-Bennett. That’s a health care plan that a number of Republicans think is a very good health care plan — one that we support. Take a look at that one.” [NBC, 6/28/2009]

Below is a timeline of Romney’s evolution on health care reform and the individual mandate from 1994 to 2011: Read more