Critics of Medicare for All often, inaccurately, attack the cost of the program. So let’s address the cost of the program. But first, let’s dispel some inaccuracies that some people have spread. Then I’ll explain the costs. Finally, I’ll list some other economic benefits that proponents seldom address. (Hint: They’re Yuuge).
Myth: Medicare for All will cost $30 trillion. Ahh, Joe Biden’s mantra. Joe doesn’t tell you that’s a 10-year projection – and he doesn’t tell you that we currently pay $3.5 trillion a year. What does $3.5 trillion come out to over 10 years, Joe? Add in inflation. And it still doesn’t cover 30 million people and undercovers another 85 million. M4A will cover every single person in the USA for much less.
MYTH: Medicare for All is “pie in the sky”. Presidential candidate Delaney’s favorite quote.
FACT: 23 countries in the developed world, comprising hundreds of years of successful experience, have similar systems. All of them work. Virtually all of them have better health outcomes than we do. In fact, the only demographic or health outcome where we place among the best in the world is – people 65 years and older! Hmmm, what happens here when you hit 65?
Call me an unrealistic, star spangled patriot, but don’t tell me that the good ol’ USA isn’t capable of doing what 23 other countries did successfully decades ago.
The reality is, we could be the healthiest country in the world for much less that we pay now. (Patience, the explanation is coming soon.)
Our Current Healthcare System (Ugh!)
· Out of the $3.5 trillion we spend each year, over $1 Trillion goes to for-profit insurance companies’ profit and overhead. That’s right, $.30 out of every dollar you spend does not go for your healthcare.
· 15-17% of your dollar goes just for for-profit overhead with it’s incredible redundancy. How many competing office buildings, accounting departments, IT departments, lawyers, company cars with chauffeurs ferrying round redundant big shots, etc., do we have to pay for? How many CEO’s and other bigshots all siphoning off tens of millions of dollars in salary and bonuses do we have to pay for?
· Medicare overhead is 1.4%. Let that number sink in.
· We spend twice as much as other countries for inferior healthcare. And you spend hundreds and hundreds of dollars every month for the privilege – plus deductibles and copays.
· Oh, and thanks to George Bush’s giveaway to the pharmaceutical industry, Medicare is the only health insurance program in the world that can’t negotiate drug prices. That’s why Bernie Sanders can take a bus load of people from Michigan, who pay $340 for a
prescription of Insulin, drive them 20 miles over the border to Canada and get the same medicine for $32!
· Remember, there are only two ways for for-profit insurance to make money: raise rates, OR pay out less for care – one reason why insurance companies have been caught in blanket denials of treatments they know they have to pay for. After all, what percent of people denied a procedure protest the denial? Far less than 100%.
OK! Here’s How We Pay for It.
Under Improved Medicare for All here’s what we will be paying for:
· Full coverage at any doctor, hospital, ambulance and other healthcare provider and/or facility.
· No bills for anything. Just give them your card. Yes, other countries do this.
· You don’t pay for prescriptions. Just give them your card. Yes, other countries do this. Great Britain charges you $5.
· Vision, dental, hearing, long term care – same.
· If you want a deluxe, private suite at a hospital or plastic surgery, well, then buy supplemental insurance.
· You will never pay another insurance premium, copay or deductible. You keep that money.
The Funding Formula
· Remember we’ve eliminated for-profit healthcare so we’re giving back $1 trillion that they ate up in profit and redundant overhead.
· Next is the money from Medicare ($705 billion in 2017), Medicaid ($582 billion in 2017), SCHIP (children – $13.6 billion in 2016), Veterans services, mental health services and a dozen other programs designed to fill in the gap in healthcare service in this country. Remember, this is all money we already spend. Lets just spend it more efficiently.
· Once we eliminate all premiums, copays and deductibles for heath insurance, we replace them with:
o A 2.5 % payroll tax. I suspect that this number will bounce around in negotiations and become more like 4% – exempting the first $29,000 in income. So compare 2.5-4% of your paycheck to what you are currently paying. Much less, right?
o A 7.5% employers tax. With a payroll exemption that will be negotiated. Much less than employers pay now.
o Drug prices will be pegged to the average of the five lowest countries that have M4A type systems. This will dramatically lower the cost of drugs ($340 to $32 in the case of insulin). We save hundreds of billions of dollars.
o Decide we need more money? How about we tell the richest man in the world, and others like him, that his company (Amazon) has to pay taxes – yeah, I know,
a novel idea. But, after all, we gave him $600 billion in our tax dollars, just for his contract with the CIA (for data services). He ought to like us.
o Here’s another way to raise trillions of dollars, which we wouldn’t need for M4A, but this is for the critics who will keep screaming it’ll cost more – Rescind the Trump tax cut for billionaires and corporations, which companies used to buy back stock to make their insiders’ stock options much more valuable. They, then, laid off thousands of workers. Yeah, I’m looking at you Loews – and others.
OK. Bonus Time. I Told You They’d be Yuuge! You Save a Lot More Money!
Remember, all of your healthcare costs are now covered. So,
· A municipal government’s largest budget line item is employee health benefits – usually around 30% of the budget. They don’t have to pay a cent of that any more. Your municipal taxes can go down by 30%.
· Same with school taxes
· And county taxes
· And state taxes – but even more! The state will no longer have to pay health benefits for 70,000 employees – $3.3 billion in 2018.
· Further, since everyone has healthcare coverage, there is no longer a need for Charity Care, which costs New Jersey $262 million in 2019
· All of this money goes back to you in tax reductions.
Better healthcare. You pay less. Your taxes go down.
But, other than that, what’s the big deal.
Barry Brendel is the Chair of Our Revolution New Jersey and Vice Chair of New Jersey for Bernie2020. Barry is a political consultant who has worked in over 200 campaigns in 20 states and 7 presidential campaigns. Barry recently worked on the successful Earned Sick Leave and $15 Minimum Wage campaigns.