July 2, 2019 | Updates

Bloomberg: Despite Sanders’s Claims, Medicare For All Would Force Families To Pay More

WASHINGTON – Senator Bernie Sanders (I-Vt.) has repeatedly claimed that under Medicare for all, the “vast majority of the people in this country will be paying significantly less,” as he declared on the debate stage last Thursday night.  But, as Bloomberg reports today, “[f]or many Americans, though, that would not be true,” and “higher taxes would exceed any savings.”  They write:

Yet the 181 million taxpayers with employer-sponsored coverage could miss out on the benefits of the Sanders plan, and even those receiving Medicaid could pay more, according to health-care policy experts on both sides of the political spectrum … Sanders’s Senate office did not immediately respond to a request for comment … Sanders has proposed a wealth tax, a bank levy and premiums paid by employers and employees.  But that only raises about half of what is needed, meaning that payroll taxes and income tax increases would necessarily have to be part of the plan.  “There are likely to be a lot more losers than winners,” Brian Riedl, a senior fellow at the right-leaning Manhattan Institute.  “It’s hard to do the tax shift without making most families losers.” … Many of the 181 million taxpayers with employer-sponsored coverage are likely to see their taxes go higher than their current health care spending, because about 56% of their medical costs are covered by their company, according to the Milliman Medical Index, which tracks annual health care spending.  For example, a person making $50,000 with employer-sponsored coverage spends about $5,250 annually on health care, meaning that under Sanders’s plan, her or his taxes would be nearly double the person’s current health care costsThose on Medicaid, the government-sponsored insurance program for the poor, are likely to see their tax burdens rise far beyond their current health spending, Riedl said.  A family of four earning $30,000 spends about $1,200 annually on health costs, according to the Kaiser Family Foundation estimates.  Sanders’ plan also assumes that health providers will be reimbursed at Medicare rates, about 40% below what they receive from private insurers.  Health care experts question whether a cut this large is feasible, meaning that the cost for Medicare for All could be even higher.

Bloomberg’s timely analysis comes on the heels of other attempts to separate Sanders’s “misleading” rhetoric from reality on Medicare for all – which, as The New York Times reports, “would not come cheaply.”  The Times recently surveyed the field of Democratic presidential hopefuls, including Sanders:

Asked how they would pay for their preferred plan, many called for higher taxes on corporations and the wealthy, starting with a repeal of the 2017 Republican tax cuts.  The two biggest champions of single-payer Medicare for All, Mr. Sanders and Ms. Warren, almost completely sidestepped the financing question; Mr. Sanders maintained that by wringing out of the system premiums, co-payments and the profits of the private insurance industry, his plan “would actually end up saving the American people trillions of dollars.”

Tellingly, Sanders has also “said his campaign purposefully didn’t put out a detailed account of his payment plan because it would ‘engender enormous debate.’”  But, while pointing out Sanders’s “misleading” rhetoric, fact-checkers for The Washington Post note that “[a]ccording to a study from the Urban Institute (and a follow-up paper), Medicare-for-all would still add $32.6 trillion to national health spending over 10 years.  The study goes on to state that Sanders’s proposed tax increase would be insufficient and that additional revenue would be needed.”

And CNN reports that “[t]ax experts … say that you can’t raise enough money from taxing the rich and that the levies on all Americans may exceed the savings for more people than Sanders expects.  This may be particularly true of low-income folks who get heavily subsidized coverage on the Obamacare exchanges … ‘His plan still doesn’t add up,’ [Marc] Goldwein [of the Committee for a Responsible Federal Budget (CRFB)] said … ‘To generate the kind of revenue that Sanders is talking about to pay for something as big as his version of Medicare for All … would be vastly more expensive than any of the kinds of things he’s talking about,’ said Howard Gleckman, senior fellow at the Urban-Brookings Tax Policy Center, a nonpartisan think tank.  ‘He’s going to have to come up with more money from some place.’”  That place is the bank accounts of middle-class Americans: There’s no possible way to finance [Medicare for all] without big middle class tax increases,” CRFB’s Goldwein explained to The Washington Post.

While many are just beginning to learn how a one-size-fits-all system would affect their health care, most Americans are well aware of the unaffordable tax hikes they’d be hit with.  “There’s one thing Americans understand about Medicare-for-all: It would mean higher taxes … Americans seem most familiar with the fact that Medicare-for-all would require massively higher taxes,” The Washington Post reports of a recent national poll by the Kaiser Family Foundation.  As Kaiser writes of their findings, “eight in 10 Americans (78%) are aware that taxes would increase for most people under such a plan.”  

And while Sanders insists that “a lot of people in the country would be delighted to pay more in taxes” to bankroll his one-size-fits-all health care system, a previous national poll by Kaiser revealed that 60 percent oppose Medicare for all when they learn it would require most Americans to pay higher taxes.

As both NBC News debate moderator Lester Holt and Senator Michael Bennet (D-Colo.) pointed out last Thursday, Sanders witnessed this exact problem in his own home state, where an effort to implement state-level Medicare for all in Vermont failed “when it became clear that people would not support the tax increases needed to sustain such a program,” as The New York Times editorial board noted recently.  The Washington Post reports that the Vermont failure “offers sobering lessons for the current crop of Democrats running for president, including Vermont’s own Sen. Bernie Sanders (I), most of whom embrace Medicare-for-all,” adding: “Then as now, many of the advocates shared ‘a belief that borders on the theological’ that such a system would save money, as one analyst put it – even though no one knew what it would cost when it passed in Vermont.  That belief would prove naïve.”

Meanwhile, as some candidates tout so-called “moderate” alternatives to Medicare for all – such as “buy-in” and “public option” schemes – it was acknowledged on the debate stage last week that these proposed government insurance systems are designed to produce the same result: a one-size-fits-all health care system run by Washington, and as such would ultimately lead to the same high costs, unaffordable tax increases, and threats to access and quality of care.



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