- The Washington Times - Friday, May 13, 2011


Health reform clearly will require government involvement, but should decisions be made in Washington or closer to home in state capitals?

In enacting the Patient Protection and Affordable Care Act last year, Congress clearly chose Washington. Rather than allowing the states to become “laboratories of democracy,” the act unwisely imposes the wrong solution on the entire country and comes with a price tag of half a trillion dollars in new taxes. It requires a massive federal bureaucracy to administer rules so complex that not even the administration’s own experts understand them. As the new health reform law is fully implemented, costs will continue to increase. The American economy will suffer as we continue to direct more and more resources to a flawed system.

This was brought to mind this week by Mitt Romney as he offered a plan that would provide federal block grants to states for Medicaid and other needs. His view is that by giving states wide discretion in meeting standards and by jettisoning needless federal regulations, both the responsibility and the resources to care for those in need, including the chronically ill and the uninsured, would be restored to states .

Proceeding in this way has multiple advantages that, much like wires bound together into a heavy cable, will produce a health care system of great resilience and strength. Unlike the federal government, state governments operate close to the ground. They are free to experiment, to devise flexible solutions appropriate for local conditions and to learn from each other about what works and what does not. Responsive to the electorate, they are well-situated to make midcourse corrections when things go wrong and, importantly, they can’t print money.

This isn’t the first time we’ve faced a daunting human service problem and called upon states to innovate our way to a better system. I was governor of Utah in 1996 when welfare was robbing people of their dignity and crippling our ability to fund other important priorities. Governors worked with Congress and the Clinton administration to redesign the program. States were granted flexibility to design the program in a way that worked for their unique needs. The result has been a triumph in public policy. A Brookings Institution study by Ron Haskins titled “Welfare Reform, Success or Failure? It Worked,” published 10 years after the new law took effect, showed that caseloads have declined, the percentage of children on welfare has been reduced, incomes have increased, and low-income workers have a pathway to work.

As a governor and then as secretary of health and human services, I’ve had the opportunity to see both sides of the federal-state partnership. Both roles are important but shouldn’t be confused. The federal government should set standards, help organize the market and help fund functions that serve national welfare. State governments should be solution shops, finding ways to reach federal standards.

The federal government should have a limited role. It should act to enable businesses and individuals to form insurance pools, which would expand the insurance market, using the power of competition to rein in costs. It should end the prohibition that keeps insurance companies from offering plans across state lines, giving consumers far more choices and thereby further fueling competition and driving down the price of premiums.

The end result would be a system in which individuals can select the kind of coverage they prefer without being hit by tax penalties for not doing Washington’s bidding. If health savings accounts proliferate, as they no doubt will, consumers will have reason to care about costs and shun needless tests while seeking out the best providers. We will have built a system that discourages waste and offers superior care.

Contrast all these advantages to the harms introduced by current reform efforts, beginning with their costs and ending with their unconstitutional seizure of state powers and prerogatives. As we head toward a presidential election during the next 18 months, we’re going to continue having a great national debate about health care. Mr. Romney’s state-based vision sets a standard for Republican candidates. To be credible, any proposal for reform will have to be in harmony with the fundamental values and principles upon which our country was founded - by devolving power to the 50 states and giving consumers freedom of choice.

Michael O. Leavitt is a former Republican governor of Utah and secretary of health and human services in the George W. Bush administration.

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