Mitt Romney insists that he will weaken the Affordable Care Act by allowing states to opt-out of key requirements of the law through the “innovation waiver” provision championed by Sen. Ron Wyden (D-OR). But as Politico’s Jennifer Haberkorn reports this morning, Romney will have a hard time making good on his promise. Wyden’s waiver wasn’t designed to destroy the law — as Romney intends to do — but rather allow states greater flexibility in meeting its goals:

Wyden, who got the waivers into the health care law and has proposed new legislation moving the waiver implementation date up to 2014, tells POLITICO he is happy that people are paying attention to the waivers. They represent an area of common ground, he says, where Republicans and Democrats can support health coverage and cost goals while allowing states to innovate.

But he warns that if Romney uses the waivers to undermine the law — which is the presidential candidate’s goal — it won’t work.

“Anybody who tries to move outside the standards of the bill — which is the coverage and costs and the like — well I’ll certainly fight that. But I think lots of other people will too,” Wyden said.

“I’m going to blow the whistle on that and say that’s not what it was about. You don’t get to come up with a waiver as a back-door way to get out of health care and not do anything.”

To qualify for waivers, states must demonstrate that they have devised an alternative plan that can cover “at least as many citizens with coverage that is at least as comprehensive and affordable as prescribed under federal law.” States that meet those requirements will only be exempt from complying with the individual mandate, the employer penalty for not providing coverage, and the exchange regulations; they will still be required to expand their Medicaid programs, regulate health insurers and meet the law’s numerous other standards.

Unfortunately for Romney, the executive branch does not have the authority to unilaterally opt states out of a law passed by both chambers of Congress, meaning that he will have to look to other means to achieve his goal of taking away coverage from 32 million Americans and increasing the deficit by $230 billion.

Massachusetts residents want to see lower health care costs, but are skeptical of the government’s ability to lower health spending, a new poll from Harvard’s Kennedy School and the Harvard School of Public Health shows. The majority of respondents also supported some form of state action to control costs:

This is good news for state lawmakers, who are currently crafting legislation “that would make Massachusetts the first state — again — to radically revamp the way doctors, hospitals and other health providers are paid.” But as pollster Bob Blendon points out to WBUR, residents believe that costs are going up because providers are charging too much for services and don’t seem very interested in finding ways to avoid unnecessary care. “The experts says people need to use less services and less expensive services, but the public’s diagnosis is, I’m being charged too much,” he notes.

The poll also found that Massachusetts residents are ambivalent about the Affordable Care Act, predicting that it will have little impact on the state.

Critics of the Affordable Care Act argue that the law encourages businesses to stop offering health insurance coverage by imposing a penalty on large employers whose employees receive tax-payer subsidies within the state-based exchanges. Since the penalty is lower than the cost of offering benefits, employers will have an incentive to dump their workers into the exchanges, increasing the costs to taxpayers, the critics say.

But other health economists have long claimed that this kind of analysis — advanced by Douglas Holtz-Eakin and others — misses the complexities involved in employer decision making and today Linda Blumberg, Matthew Buettgens, Judy Feder and John Holahan of the Urban Institute are out with a new study explaining why firms would be discouraged to dump their workers:

The bottom line is that most workers’ firms will be dominated by workers who will receive better benefits and, through the tax system, better subsidies through employer provided coverage than through newly created insurance exchanges. The strength of employee preferences may be hard to read in the short term, and some employers may seek immediate financial gain in benefit reduction as markets adjust to new circumstances. But over time, coverage reductions inevitably would make the workers that employers most want to keep worse off, and if those workers sought employment elsewhere as a result then the firm would be worse off as well. It is therefore unlikely that large numbers of employers currently providing insurance coverage will change their decisions to offer it.

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In general, if an employer drops coverage, better-paid workers will be worse off. Even if they receive higher cash wages to offset the loss, they will face taxes on these wages which, keeping overall compensation at the level of their value to the firm, will not be offset. Exchange benefits will also be unattractive, relative to employer provided benefits, for better-off earners. Exchange-based subsidies are limited to plans with an actuarial value no greater than 70 percent, a value much lower than provided by the typical ESI plan (85 percent).

The whole report is worth reading here. Generally, my take is that we’ve seen fluctuation in the employer health insurance market before reform and will continue to see changes as we move through implementation. But employers, who are very interested in controlling their health care costs, will likely continue to offer insurance for the forseeable future and when they don’t, Americans will have a sensible and affordable options to fall back on.

If you are still wondering why proposals to expand the role of private insurance in the Medicare program would shift the costs of coverage from the government to the beneficiaries and force those beneficiaries to pay more for the same coverage, this latest estimate of health care costs really closes that circle. Note that while per capita costs for private insurance rose by 7.89 percent in August — during a period of below-average care utilization — Medicare costs increased by just 2.16 percent:

An index following the average cost for health care is up a fourth consecutive time, after it hit a bottom in April, Standard & Poor’s Ratings Services said.

According to the ratings firm’s latest index report, the average per capita cost of health care covered by commercial insurance and Medicare rose to 5.73% over a 12-month period ended in August. The increase is just above the 5.69% index level set in July. The index hit a recent nadir in April at 5.32%.

Commercial insurance rose by 7.89% in August, using the same moving year-long marker. But Medicare claim costs hit a new low, rising at an annual rate of 2.16% during the same time period. The highest rate for Medicare growth was 8.02%, set in November 2009.

In other words, “future retirees” or whoever else Republicans want to shift into private insurance would have to swallow those higher cost increases that result from private insurers having higher administrative spending, less efficiencies, and limited leverage.