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“The Grandfather Of Obamacare”: How Mitt Romney Paid For Romneycare With Federal Help

Republican presidential candidate Mitt Romney told Univison in an interview Wednesday that he did not mind when President Obama called him the “grandfather” of Obamacare when referring to the program Romney instituted when he was governor of Massachusetts. Quite the opposite. Romney thought other states might take a page from the Massachusetts playbook.

We didn’t have to cut Medicare by $716 billion. We didn’t raise taxes on health companies by $500 billion, as the president did. We crafted a program that worked for our state. I believe the right course for health care reform is to say for each state we’re going to give you the Medicaid dollars you’ve had in the past, plus grow them by 1 percent. And you, as the states, are now going to be given targets to move people to insurance, and you craft programs that are right for your state. Some will copy what we did; others will find better ideas.

Romney is right: The state of Massachusetts did not cut Medicare to finance health care (nor could it have, as states don’t have a say in the federally financed entitlement budget). Whereas the Affordable Care Act levies a tax on insurance companies and makers of medical devices, the Massachusetts law has no similar provision.

But could a state with a capped Medicaid budget, as Romney has proposed, copy what Romney did in Massachusetts and end up with universal coverage? Romney’s own experience suggests probably not: His state a special pot of federal money, alongside a preexisting assessment on hospitals and insurers, to expand insurance coverage to 98 percent of its population.

Way back in 1985, under then-Gov. Michael Dukakis, Massachusetts set up a program called the Uncompensated Care Pool. Much like the name suggests, the pool is used to finance health care for those without insurance. Massachusetts financed the plan largely through assessments on hospitals and insurers. Under Romney’s administration In 2004, each industry paid in about $157 million to keep the pool running. That plan still operates today — under the name Health Safety Net – and covers health care needs that Massachusetts residents cannot afford.

Since the late 1990s, Massachusetts has also received additional Medicaid funds to enroll populations that other states traditionally do not cover. In 2005, when Romney was governor, the federal aid amounted to $550 million. As former Romney adviser John McDonough explains in his book “Inside Health Policy,” the funds were crucial to laying the foundation for universal health coverage. He takes us back to 2005, when the George W. Bush administration was getting ready to end that special funding arrangement:

“In Masachusetts, $350 million is a lot of money, and the news set off alarm bells. Governor Romney reached out and formed a partnership with Senator Kennedy to scheme how to keep the extra federal dollars coming. At that moment, the state’s mundane desire to retain federal dollars merged with the policy goal of universal coverage to create a new policy imperative. Romney and Kennedy proposed that Massachusetts keep receiving the extra payments and in return the state would shift the use of those dollars [to] subsidies to help lower-income individuals purchase health insurance coverage.”

Ryan Lizza recounts a similar version of events in his New Yorker article on Romneycare. That state ultimately secured three years of additional Medicaid funding, $1.05 billion, which largely financed the Massachusetts expansion. Both accounts suggest that it was a special commitment from the federal government, rather than a capped budget, that spurred Massachusetts’ success.

Since then, employers and individuals have chipped in to keep the universal coverage program afloat. The Blue Cross Blue Shield Foundation of Massachusetts saw spending by both of those groups increase in the year after Romneycare became law, which they attribute to rising medical costs and the insurance expansion.

Five years later, it’s largely federal funding that keeps Massachusetts’ universal coverage afloat. Since 2005, the state has twice renewed that federal waiver — the one Lizza and McDonough wrote about — to provide additional Medicaid dollars to the state.

The most recent renewal was last December 2011, when the state secured $26.75 billion in federal funds over the course of three years. It will, among other programs, continue to finance the universal coverage program.

“The milestone agreement also ensures the ongoing success of Massachusetts’ historic health care reform initiative, through which more than 98 percent of the Commonwealth’s residents, and 99.8 percent of children, have health insurance,” Massachusetts Health and Human Services Secretary JudyAnn Bixby wrote at the time. “The waiver fully funds our ongoing health care reform implementation.”

So Massachusetts used not just federal Medicaid money but federal dollars above and beyond that Medicaid money to finance their health reforms. It is difficult to see how Romney’s proposal to cut Medicaid spending and hand that reduced share over to the states would allow other states to follow Massachusetts’ example. It might not even permit Massachusetts to continue following Massachusetts’ example.


By: Sarah Kliff, The Washington Post, September 21, 2012

September 23, 2012 Posted by | Election 2012 | , , , , , , , , | 1 Comment

“Bain-Like Bonuses”: A Leveraged Romney Campaign With Nothing For The Troops

Mitt Romney’s campaign is in a bit of trouble. No, not poll numbers, or internal disputes, or the candidate himself, though those are all problems too. Rather, the Romney campaign, which outraised President Obama for four consecutive months this summer, is in money trouble. Campaign finance disclosures released yesterday show the campaign has only $35 million in the bank — a relatively low amount this close to the election — and is $15 million in debt. The campaign has been forced to scramble to find new big donors, something you don’t want to have to do this late in the game, because its other donors are maxed out.

The problem is not Romney’s fundraising abilities — he’s unquestionably adept at bringing in big checks — but rather with quirks in campaign finance law, his reliance on big donors, and perhaps some mismanagement. The loan was needed as a bridge before he could access his general election fund, which candidates can’t touch until after their nominating conventions. The low cash on hand is because much of the money he raised went to the Republican National Committee to help pay for other races and not to the Romney campaign (he redistributed the wealth, if you will). And the need for new contributors is a byproduct of relying on high-dollar donors, who max out after contributing $2,500 and thus can’t be returned to for a consistent money stream throughout the campaign like smaller donors (John McCain had the same problem in 2008).

Given all that, not to mention the other problems the campaign is facing, this is a bit unexpected. The Washington Post’s Dan Eggen:

Mitt Romney’s campaign handed out more than $200,000 in bonuses last month to senior staffers, according to new disclosure records filed Thursday. Richard Beeson, Romney’s national political director, received a $37,500 payment on Aug. 31 in addition to his salary, according to records filed with the Federal Election Commission. In addition, records show at least six other top staffers each received $25,000 bonuses on the same date: campaign manager Matt Rhoades, general counsel Kathryn Biber, policy advisor Lanhee Chen, communications director Gail Gitcho, digital director Zach Moffatt and advisor Gabriel Schoenfeld. Two other employees received $10,000 bonuses.

“Win bonuses” are pretty common on political campaigns, though President Obama’s campaign did not hand out any after its convention this year. And $200,000 isn’t a ton of money for a campaign that will spend close to a billion dollars. But one has to wonder if it’s really a good idea for a struggling campaign that’s already in debt to hand out cash to its top executives while the candidate is fighting a perception of being a corporate raider .

The comparison to Bain Capital, though imperfect, is almost too obvious to make. Bain often bought companies, leveraged them with massive debt, and then paid the executives big bonuses regardless of whether the company succeeded. Something not entirely dissimilar happened to Bain & Co., the consulting firm that Bain Capital spun off of, when Romney went to rescue it.

And while the very top echelon of his campaign got bonuses, there was nothing for the ground troops. The field staffers who work too many hours manning lonely remote offices for the reward of meager pay and doors getting slammed in their faces didn’t get a bonus. Neither did drivers or clerks or janitors or opposition researchers forced to cable news 24 hours a day.

Again, this isn’t entirely unusual for any political campaign. People sign up knowing they’ll be worked hard for no money because they believe in their candidate and maybe hope they have a shot at a job if their guy or gal wins. But one can’t help wondering if the bonus model sheds some light on Romney’s view of the world and how businesses are run. It’s the people at the top who make it happen and deserve the bonuses, not the ones down below who are actually doing the work.


By: Alex Seitz-Wald, Salon, September 21, 2012

September 23, 2012 Posted by | Election 2012 | , , , , , | 1 Comment

“A Luxury Reserved For The Wealthy”: Taxes Are Not A Charitable Donation

Almost all federal taxpayers who itemize their charitable deductions on their returns deduct the full amount, in order to keep their tax burden as low as possible. Mitt Romney didn’t do that in 2011, according to tax returns released today, leaving $1.8 million un-deducted so he could tell voters he paid a federal tax rate of at least 13 percent. That’s a luxury reserved only for wealthy politicians who can afford to pay an extra few hundred thousand for image purposes.

But one unfortunate line on a memo from Mr. Romney’s lawyer, accompanying the tax returns, suggests that Mr. Romney really doesn’t see much difference between giving to charity and giving to the government.

“Over the entire 20-year period, the total federal and state taxes owed plus the total charitable donations deducted represented 38.49% of total AGI,” the memo said, referring to Mr. Romney’s adjusted gross income. In his mind, apparently, you can just add up the two figures into a new hybrid column, perhaps called, Total Obligation to Society, and make yourself look even more generous.

It doesn’t work that way, however; charity and taxes cannot be conflated to make it sound like you are “giving away” a larger portion of your income than you are. Conservatives can hate paying taxes, and Mr. Romney in particular appears to hate having tax money spent on the “dependent class,” but that doesn’t make the government a charity.

Taxes represent the obligations citizens have to each other and to society, fostering physical safety with defense and law enforcement spending, economic safety with public works, and personal welfare for the needy. Charity is entirely voluntary, even for those who, like Mr. Romney, are asked by their religious authorities to tithe a fixed portion of their income. Those donations play a vital role in every American community, but they can never take the place of a firm government safety net, as much as they are preferred by the right to taxes.

One would think that someone running to be the government’s chief executive would be proud to make tax payments, and would not try to reduce them through exotic foreign tax shelters and an outsized IRA, as Mr. Romney has done for years. But the announcement today that he had deliberately “overpaid” his taxes was grudging and entirely for show. He overpaid them only so that he couldn’t be accused of paying far less before the election.

Despite his accountant’s statement today that he had never paid less than 13.66 percent of his income in taxes over the last 20 years (a level that would make many middle-class taxpayers jealous), it is still an assertion that has not been backed up by the release of actual tax returns for that period. For all the highly trumpeted discretionary donations he has made, Mr. Romney apparently still doesn’t want the public to see how assiduously he has worked to lower his most important social obligation.


By: David Firestone, The New York Times, September 21, 2012

September 23, 2012 Posted by | Election 2012 | , , , , , , , , | Leave a comment

“High Noonan”: Mitt Romney Needs A New Biography, A New Personality, And A New Party

The latest intramural brouhaha in the GOP centers on the unlikely figure of my favorite columnist, the ineffably successful Peggy Noonan.

Earlier this week, you may recall, she penned a column (or a blog post, as it was styled, presumably because her rambling comments could not be edited, or were so urgent as to require immediate publication) that lashed Mitt Romney’s campaign for “incompetence” and then wandered around whatever keyboard or cocktail napkin she was drafting it on before settling on the suggestion that Romney deliver a “big speech” in Brooklyn. Yes, Brooklyn.

Anyhow, this act of heresy produced sufficient heartburn in the Romney campaign or amusement among her superannuated Republican cronies that she followed up today with a new blast at Team Mitt. This time around, perhaps with the aid of an editor, she produced an actual on-the-record quote from a “corporate strategist” who analyzed Romney’s mistakes at considerable, if unoriginal, length. Having teed up this moment (like all moments for many MSM pundits) as crucial, Noonan delivered herself of another Big Idea for Mitt, which is about as plausible as a redefining speech in Brooklyn: Romney needs his very own Jim Baker to take control of his campaign. Indeed, she may be (her crystalline prose leaves this unclear) be urging Romney to bring on the actual Jim Baker to take control of his campaign. Since Baker is 82 years old, I don’t think that’s happening. But putting that aside, the idea that Mitt Romney is going to bring in some Yoda to turn his campaign upside down with just over six weeks until election day is, well, the sort of thing only Peggy Noonan could say.

More generally, this Aging Republican Establishment obsession with alleged staff errors is a pretty good indicator these folks haven’t a clue about the structural problems facing Mitt, who rendered himself virtually immobile in winning the GOP nomination over a weak field and now has no record to run on, and an agenda he’s afraid to talk about–totally aside from having the least attractive persona of any GOP nominee since Nixon. Mitt doesn’t need a “new CEO,” Peggy; he needs a new biography, a new personality, and a new party–you know, one that doesn’t either demand he loudly promote a suicidal policy agenda, or sit around carping about how he doesn’t do things like Ronnie.


By: Ed Kilgore, Contributing Writer, Washington Monthly Political Animal, September 21, 2012

September 23, 2012 Posted by | Election 2012 | , , , , , , | Leave a comment

“Pre-Planned Parenthood”: Reproductive Rights For Me, But Not For Thee, Romney Family Edition

Oh my. I was not aware of this: in 2011, Mitt Romney’s son Tagg and Tagg’s wife Jen, who earlier this year had twins through a surrogate, signed a contract with the surrogate giving themselves and her the right to abort a pregnancy, even in non-life-threatening situations. And on top of that, Mitt himself subsidized the arrangement, since he helped pay for the surrogate’s services. Oopsy!

TMZ is reporting that the contract provided for the right to abortion if the pregnancy was judged to pose “potential physical harm” to the surrogate, or if the fetus was deemed to be less than genetically perfect. To be fair, it’s unclear whether Mitt or his lawyers actually read the contract. It’s also true that Tagg’s lawyer claims that the abortion provision was not something Tagg and his wife wanted and that it was kept in the contract by mistake, but that explanation sounds suspiciously like ex post facto ass-covering to me.

The contract’s provisions are eminently reasonable, because no one should be forced to carry a pregnancy to term against her will, no matter what the reason. Yet Mitt Romney has claimed that he supports abortion rights only in the event of rape, incest, or a threat to the health or life of the mother. I don’t doubt that, like the vast majority of elites, Romney would support abortion rights for his own family members for any reason, because rich white Christians by definition are not those slutty, trashy people running around having the “wrong” kind of abortions, just for the hell of it.

Still, these revelations pose a dilemma for Romney’s anti-choice supporters: by explicitly and personally subsidizing the right to abortion, as Mitt Romney did by paying the surrogate, is he better, worse, or no different than a nefarious outfit like Planned Parenthood? Inquiring minds want to know!


By: Kathleen Geier, Washington Monthly Political Animal, September 22, 2012

September 23, 2012 Posted by | Election 2012 | , , , , , , , , | Leave a comment

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