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Marie Fishpaw

Fishpaw

Think you’ll be better off if Congress outlaws your private health coverage and puts you on a new government-run health plan called “Medicare for All?

More than half of House Democrats and 14 senators, including Elizabeth Warren (D-Mass.) and Bernie Sanders (I-Vt.) say you will. They promise this massive change and disruption is worth it because most will save money.

For example, Sen. Sanders has said: “Are people going to pay more in taxes? Yes. But at the end of the day, the overwhelming majority of people are going to end up paying less for health care because they aren’t paying premiums, co-payments or deductibles.”

Health-care experts Ed Haislmaier and Jamie Hall, however, took a hard look at this claim in a new Heritage Foundation study and found it simply isn’t true. The politicians are promising far more than they can deliver.

Most Americans would see their expenses rise substantially.

Depending on how much they earn, and where they get their coverage today, Medicare for All would cost some working families more than what they pay for electricity; for others, it would exceed their gasoline budget; and for others, their food budget.

All told, roughly three-quarters of Americans would be worse off.

That’s because they would pay more in additional taxes than they would save from no longer paying privately for health care. Households that currently have employer-sponsored coverage would be particularly hard hit, as their disposable incomes would shrink by an average of $10,554, and 87% of them would be financially worse off.

Even lower-income working families, currently getting health care through government programs such as Medicaid and the Children’s Health Insurance Program, would be worse off. Their average household disposable income would decline by $5,592 per year.

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Paying for the new program will require taxes to go up — a lot.

Fully funding Medicare for All requires a new, additional tax of 21.2 cents on every dollar every American earns. That’s on top of what they pay now — meaning that, under Medicare for All, most working Americans would see half their paychecks going to the government.

Haislmaier’s and Hall’s study shows the rich, working poor and middle class would have to pay these taxes to fund Medicare for All. The only people who might not see a financial hit? Generally, retirees on Medicare today. But, since Medicare as they know it would go away, they might have greater concerns than the impact to their pocketbooks.

Sen. Warren says that the middle class can avoid these taxes, but her incomplete payment plan (like Sanders’) does not cover the full cost of Medicare for All. No legislative sponsor of this idea has provided a plan to fully pay for these promises. That’s why Haislmaier’s and Hall’s analysis required them to fill in some details that advocates haven’t given.

In real life, we know that if Americans were faced with such a massive tax increase, some would cut back on work hours or quit working altogether, but Haislmaier and Hall decided not to include that speculation.

Instead, they assumed that all Americans would continue to work just as much as they did beforehand, while their employers convert current health insurance spending into additional taxable wages. So, if anything, these figures fall a bit short of what would be needed.

It’s true that American workers deserve a better health care system. Obamacare has given us higher costs and fewer choices. It’s a law that’s benefited big insurance companies and left too many American families struggling to afford coverage.

Congress must work toward solutions that address these legitimate concerns and put American families and doctors back in the driver’s seat of decision making.

But turning over our health care to big government isn’t the answer. Medicare for All needs to come off the table because it won’t deliver the solutions Americans deserve, no matter what its advocates may claim.

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Marie Fishpaw is director of Domestic Policy Studies at The Heritage Foundation (heritage.org).

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(6) comments

Hive

Packman, the coming need will demand a central fund...who/what will do it? Population is rising exponentially...as are costs.

There are lots of similar thinking dodgers who have no clue what to do...what about them? Part of life and freedom is making the other person look good...

POTUS is the opposite and it does not abide freedom...

Packfan

Medicare and SS are running short on money now. How will Medicare ever survive without massive tax input? It can’t. I was promised a $2500.00 annual saving by Obama, instead my premiums, out of pocket and deductible went up on my employer sponsored health care. I love my insurance, in spite of Obama care guidelines I have low deductible, low max out of pocket, all preventative 100% covered.

Keep the government out of my health insurance!

Hive

Bruce, "...Get money out of politics." +1!

When we gonna learn?

Our hard working elected pols running for offices will get and spend enough to pay for "meds for all" for 5 years, in the two years prior to Nov 2020.

Believe it!

RiverHawk

So, the US is the only nation in the developed Western world where it "can't" work?

If that's true, we should be embarrassed.

Bruce Montplaisir

If you took all the insurance company salaries over a given amount, say $5 million a year, and applied that to the costs of taking care of people that get sick or injured how many people would that take care of? What about the costs of keeping lawyers on staff to make sure benefits are not paid; would that save anything that could go towards taking care of people that get sick or injured? There seems to be a lot of expenditures not associated with taking care of people that get sick or injured. It takes time, a will to make it work and a process for moving from a cost based health care system to a care based health care system. First step is to get money out of politics.

Hive

Am dubious, but any program can work,

when people have the will to make it work.

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