3.20.20 / Updates

New CRFB Report Examines Unaffordable Costs Of Medicare For All

WASHINGTON – new report from the Committee for a Responsible Federal Budget (CRFB) finds that a one-size-fits-all government-controlled health insurance system known as Medicare for All would “significantly increase federal spending,” and “[t]axes on high earners and corporations alone could not finance Medicare for All.”

The new report finds that“Medicare for All is likely to increase federal costs by between $25 trillion and $35 trillion over ten years … To finance $30 trillion – a rough midpoint – policymakers would likely adopt a combination of approaches that are equivalent to a 32 percent payroll tax, 25 percent income surtax, 42 percent value-added tax (VAT), a $7,500 per capita mandatory public premium, doubling all income tax rates, reducing non-health spending by 80 percent, or increasing debt 105 percent of GDP.  Taxes on high earners and corporations alone could not finance Medicare for All.”

CRFB also assesses the significant economic consequences of Medicare for All’s unaffordable costs, and finds that “payroll tax financing Medicare for All would reduce GDP by 7.3 percent in 2030, deficit financing it would reduce GDP by 5.9 percent, and premium financing would reduce GDP by 2.3 percent.  Those options would reduce hours worked by 12, 10, and 7 percent, respectively – the equivalent of 17 million, 14 million, and 10 million jobs.”

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