CBSN

Mass. Gets Landmark Health Coverage

GENERIC health insurance, fewer people being covered
AP / CBS
Gov. Mitt Romney on Wednesday signed a law guaranteeing virtually all Massachusetts residents have health insurance, making this the only American state committed to comprehensive medical care, considered a right in most developed nations.

The bill, intended to extend coverage to Massachusetts' estimated 550,000 uninsured, is being touted as a national model, thrusting the state to the forefront of the national debate about how to provide near-universal health care coverage without creating a single U.S. government-controlled system.

It's also a political coup for Romney as he weighs a potential run for the Republican presidential nomination in 2008. The bill could be a centerpiece of that campaign if Romney can credibly claim pushing through a groundbreaking health care reform package.

The governor vetoed a key portion of the bill, a $295-per-worker assessment on businesses that do not provide health insurance. Some critics have called that provision a tax on businesses.

Romney used his line-item veto power to strike eight portions of the bill, most significantly the $295 fee. Administration officials say the fee could actually discourage registration for the new health program, since some employers might consider it cheaper to pay the fee than to insure workers.

"It's a very small feature of this bill. It's a very insignificant and unnecessary and, in some respects, counterproductive element of this bill," Romney had told The Associated Press in an interview on Tuesday. "It applies to a tiny number of employers, and it raises a very small amount of money relative to the scale of this entire proposal. So I don't think it's necessary."

Leaders of the heavily Democratic House and Senate said they would override any changes made by the governor.

"To change anything will disturb the delicate balance that made this law possible," House Speaker Salvatore DiMasi said in a statement. "Each and every element of this law is critical to accomplishing our intentions and goals."

In addition to the assessment for businesses, the bill would provide subsidies and sliding-scale premiums to get poor and low-income residents into health plans. Those deemed able to afford insurance but who still refuse would face increasing tax penalties.

Some critics say the requirement that everyone have insurance is an unacceptable expansion of government power.

The bill's cost was estimated at $316 million in the first year, and more than a $1 billion by the third year, with much of that money coming from federal reimbursements and existing state spending.

Jack Meyer, president of the Economic and Social Institute in Washington told CBS News' The Early Show co-anchor Hannah Storm that the landmark bill was largely a function of compromise.

"Massachusetts looked at about 550,000 people without health coverage and decided they needed to set aside their partisan differences, their bickering, and they pulled together the best elements of Republican thinking and Democratic thinking," Meyer said. "They shared the burden across consumers, employers, state government, the federal government, which is putting in money, and so they came up with a bipartisan approach — and they were willing to compromise. That's what's been missing so far."

The Massachusetts bill takes effect in July 2007, right around the time that Romney is expected to decide whether he will run for president in 2008.