Conservatives are unhappy with Mitt Romney once again. This time it’s for announcing that former Utah Gov. Mike Leavitt will chair his transition team.
Leavitt has committed two deadly sins. He’s encouraged state leaders to implement the health insurance exchanges required by President Obama’s Affordable Care Act — and he’s profited from it.
Many top conservatives consider that apostasy. They believe the health care law must be completely vanquished — even the parts people like and even the parts conservatives have supported in the past.
Take a closer look at Leavitt’s history with “Obamacare” and the story becomes more complicated, as it is for many Republicans who have been at this health care reform business for a while. Like Romney, Leavitt has been been around long enough to see the market-based health care reforms that were originally championed by Republicans be adopted by the Democratic Obama and then savaged as socialist by a new generation of conservatives. Again, it’s complicated.
First, there’s the private sector work Leavitt and his consulting firm have been engaged in. Leavitt Partners set up shop in Salt Lake City in 2009, after Leavitt served as secretary of Health and Human Services for George W. Bush’s entire second term. (Prior to that he had been Bush’s EPA administrator from 2003-2005.) In 2011, the Leavitt Partners teamed with Connextions, Inc., to consult for states seeking to comply with the new health care reform law.
“Designing and implementing successful health insurance exchanges in time to meet federal deadlines will require innovation, technology, and a keen sense of the interplay between government, business, and consumers,” Leavitt said in a statement last June. “We have the people and know the issues. We will leverage what Connextions has learned building and launching exchanges for Fortune 500 firms to bring strategic insight to states and private sector firms that are seeking solutions.”
Leavitt believes that states should comply with the law’s requirement that they set up insurance exchanges: government-regulated insurance marketplaces. But that’s not necessarily because he’s in love with the law in its entirety.
In a July meeting with a bipartisan group of governors, he called exchanges “a very practical solution to a problem that needs to be solved” and warned that ignoring the law’s requirement amounted to cutting off their own noses. The ACA empowers the federal government to step in and implement exchanges if intransigent states refuse, which means bucking the law only gives the federal government more power.
Leavitt’s pragmatism about exchanges is a deal breaker for the right. But pair it with some of Leavitt’s other public statements about the ACA, and it’s not clear why it should be — at least not if you step back and survey the entire spectrum of market-based reforms that Republicans, for the most part, continue to support.
Leavitt’s on the record along with the rest of the GOP that the entire law should be repealed. “I believe the Affordable Care Act should be repealed, period,” Leavitt told Politico in February.
There’s obviously tension between that view and his financial and ideological interest in seeing states set up exchanges. But a state exchange system wouldn’t necessarily have to serve as the foundation for a universal health care system like the one Obama envisions.
For example, House Republicans’ official budget blueprint, drawn up by Rep. Paul Ryan (R-WI) makes use of exchanges to phase out Medicare as government-guaranteed health insurance. If Ryan and his acolytes were to get their way, Medicare will slowly be replaced with a private system that would provide beneficiaries with subsidies to buy insurance on exchanges — like the ACA but for seniors.
Leavitt has hinted at this endgame for a long time now. In an August 2010 Washington Post op-ed, he attacked the ACA’s Medicare reforms as illusory, arguing, “What’s needed is a new vision for Medicare. Instead of micromanaging prices, the federal government should provide oversight of a marketplace in which cost-conscious seniors choose among competing insurance and delivery system options.”
That’s a market-based solution conservative Republicans still support. It’s the nucleus for “Ryancare,” which nearly all Republicans endorsed when they voted en masse for the House GOP budget in 2011 and 2012. And it requires the creation of a state-by-state or national insurance exchange.
Still, Leavitt has said and done other things in the health care realm that might concern the right.
His consulting firm studied best practices for so-called Accountable Care Organizations — provider groups reimbursed for quality of outcomes — that Obamacare encourages as a potential source of major cost-savings.
In a February interview with Modern Healthcare, Leavitt admitted that the ACA contains the seeds for other important cost controls, too. It “gives the secretary authority to do certain things that are clearly aimed at trying to move us in this direction. … A lot of it will depend on how aggressively the secretary chooses to use the authorities in the law to move us in that direction.”
Along with former Rep. Dick Gephardt (D-MO), Leavitt co-chaired a PhRMA-affiliated advocacy group called the Council for American Medical Innovation, which commissioned and published a 2010 report listing numerous ways the law could facilitate advancements.
“The landmark healthcare reform legislation and accompanying reconciliation bill that was enacted in late March, known as the Patient Protection and Affordable Care Act (PPACA) … has several targeted provisions to advance medical innovation, namely the 12-year data exclusivity provision for biologics, the formation of the Cures Acceleration Network, and the establishment of a Therapeutics Discovery Tax Credit,” the report (PDF) reads. “But, the PPACA’s most far-reaching impact on medical innovation is to expand the market of patients, by most estimates nearly 30 million, who will benefit from regular access to medical care and recommended treatments through increased insurance coverage.”
CAMI’s lobbying has slowed dramatically since the ACA passed, and Leavitt’s no longer listed as one of its co-chairs. A spokesperson did not return a request for comment Monday evening.
Leavitt hasn’t been an anti-‘Obamacare’ fire breather, and as such has failed one of the conservative movement’s key litmus tests. But where he sees promise in the ACA are in measures compatible with the market-based approach to health care reform that conservatives have claimed to want for years.
Brian Beutler is TPM's senior congressional reporter. Since 2009, he's led coverage of health care reform, Wall Street reform, taxes, the GOP budget, the government shutdown fight, and the debt limit fight. He can be reached at firstname.lastname@example.org.