BOSTON - Gov. Mitt Romney on Wednesday signed into law a landmark bill designed to guarantee virtually all Massachusetts residents have health insurance.
However, 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.
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 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.
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.