Don’t Be Fooled: American Families Can’t Afford One-Size-Fits-All Care
WASHINGTON – Regardless of what proponents of Medicare for All try to claim, studies and economists from across the political spectrum agree that a new one-size-fits-all government-controlled health insurance system would hit American families with unaffordable costs and tax hikes.
Earlier this month, presidential candidate Senator Elizabeth Warren (D-MA) released a proposal to pay for Medicare for All that experts agree “significantly [underestimate] the costs,” The Washington Post reports. “There’s no way it’s $20 trillion,” Kenneth Thorpe, chairman of the health policy department at Emory University, told The Washington Post, adding, “[t]he bottom line is, even with all the big numbers she’s got in there, you’re only getting 55, 60 percent of the way there.”
The Wall Street Journal editorial board called the Medicare for All proposal “a fiscal and health-care fantasy,” and as Ronald Brownstein explains in The Atlantic, “Warren’s estimate is considerably lower than most projections for a single-payer system,”
Even at a flat $20 trillion, such a plan would cost more than the federal government now spends on Social Security alone or on Medicare and Medicaid combined. Estimates from the nonpartisan Rand Corporation, the conservative-leaning Mercatus Center at George Mason University, and the center-left Urban Institute have each placed the 10-year cost of a single-payer plan at $31 trillion to $34 trillion.“The gap between what she says it will cost and what it will really cost is in the trillions of dollars, and the middle class will be on the hook to fill that gap,” says Jim Kessler, the executive vice president for policy at Third Way, a centrist Democratic group that has been critical of single-payer proposals. “My guess is that with accurate numbers, she’s somewhere between $5 trillion and $10 trillion short. [Her plan taps] the rich and corporations as much as possible. Who’s left? The middle class.”
And when it comes to the proposal’s $9 trillion tax on American workers, The Washington Post reports that “[b]asic economic theory holds that such payments are essentially a tax on employees because it comes out of compensation.” Echoing that point, “economists predict that this will get passed onto workers through reduced wages,” Axios reports.
This new tax “falls disproportionately on companies offering extra benefits – and on employees making the lowest incomes,” The Wall Street Journal notes. “[P]ayroll costs of this sort are essentially middle-class taxes on employees. Fixing per-employee business costs at some future date would also be an incentive for companies to reduce their coverage now to reduce future costs. So employees would get worse coverage than they have now,” The Journal adds.
And as CNN reports, “[t]hat could hurt the middle class in a roundabout way, say some experts.” As Howard Gleckman, senior fellow at the Tax Policy Center, explains, “[Warren] has found a clever way to make middle-income people finance a portion of government health insurance without paying a direct tax … But make no mistake, they still will be paying.”
The fact is, there’s simply “no way to pay for Medicare for all without tax increases … on the middle class,” Marc Goldwein of the Committee for a Responsible Budget (CRFB) told POLITICO.
A new analysis from the nonpartisan Committee for a Responsible Federal Budget (CRFB) warns that Medicare for All “would require aggressive changes in taxes, spending or borrowing,” and “the middle class would be forced to shoulder some of the burden,” Axios reports. “These policies would have massive economic impacts, reverberating far beyond health care,” Axios adds. This tracks with an previous analysis released from CRFB which warns that “fully offsetting the cost would require higher taxes on the middle class.”
“[Medicare for All] is extremely difficult if not impossible to pay for by taxing the rich alone, according to both liberal and conservative economists,” The Washington Post confirms. That’s because “analysts on both the political right and left have estimated [Medicare for All], which Warren has said she wholly backs, could cost more than $30 trillion over a decade. By comparison, the overall federal government spent about $4 trillion last year,” The Post reports.
Shedding additional light on some of these new unaffordable costs, a recent study from the Urban Institute finds “that federal spending on health care would increase by roughly $34 trillion under a single-payer plan similar to Medicare for All,” CNN reports. Ronald Brownstein of The Atlantic notes that the “eye-popping” cost is “more than the federal government will spend over the coming decade on Social Security, Medicare, and Medicaid combined.”
Bloomberg previously reported that “for many [Americans], higher taxes would exceed any savings … [T]he 181 million taxpayers with employer-sponsored coverage could miss out on the benefits of [Medicare for All], and even those receiving Medicaid could pay more, according to health-care policy experts on both sides of the political spectrum … [A] wealth tax, a bank levy and premiums paid by employers and employees … 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.”
And, “economists say that most taxpayers would pay more in taxes than they would save from having the federal government absorb the cost of health-care premiums,” The Post also reports. Additionally, “71% of households with private insurance would wind up paying more than they would under the current system,” Kenneth Thorpe, chairman of the health policy and management department at Emory University, told The Wall Street Journal.
The Kaiser Family Foundation finds that 60 percent oppose Medicare for all when they learn it would require most Americans to pay higher taxes. And Voter Vitals – a quarterly tracking poll conducted nationwide and in 2020 battleground states – finds that a majority of Democratic voters are unwilling to pay any more in taxes for universal coverage, while a supermajority of Democrats (69 percent) support building and improving on what we have today over new government insurance systems.