So did they cave or not?
This article is saying that Romney and his legal counsel overruled this 1975 statute with the 2005 law -- thus forcing Catholic Hospitals to dispense these drugs.
Though Romney vetoed the 2005 law (only to have the veto overriden), he did the about face in terms of the interpretation of the 2005 law and doing away with the 1975 conscious clause.
Thus Romney's Flip-Flop hurt the Catholic Church.