The new report, from
a think tank that supports balanced budgets, estimates that the proposal could
boost payroll taxes 32 percent, or double taxes on
income and business.
Oct. 29, 2019, 1:53 PM CDT By Benjy Sarlin
WASHINGTON
— Paying for "Medicare for All" could require raising payroll taxes
by 32 percent on workers and businesses, among other options, according to a
new report from a think tank that advocates for balanced budgets.
But the
report, released Monday by the Committee for a Responsible Federal Budget, also
suggested that middle class families could save money overall, even with
significantly higher taxes.
The study comes as Sens.
Bernie Sanders, I-Vt., and Elizabeth Warren, D-Mass., both presidential
candidates, face pressure from rivals to detail how they
would pay for their proposal to move the country onto a more generous Medicare
program with no premiums and minimal out-of-pocket costs. Warren has said she
is working on such a plan.
The new
report assumed Medicare for All would add an additional $30 trillion in federal
spending over 10 years, which is toward the lower end of outside studies and in
line with rough estimates by Sanders, the author of the Medicare for All bill.
“It’s
probably generous for how much it would cost in the real world,” Marc Goldwein,
the committee's senior vice president, told NBC news.
Other
options that on their own could fund Medicare for All, according to the study,
include a 25 percent income surtax; a 42 percent value-added tax on
consumption; a move to more than double all individual and corporate tax rates;
or, more likely, a combination of taxes.
The
report estimated that taxing the rich, corporations and the financial sector
could cover only one-third of the total cost on its own.
While the
report warned that some of the tax options presented would slow economic growth
or push top tax rates so high that they no longer maximize revenue, its authors
also suggested that Medicare for All could reduce average total costs for
lower- and middle-income families by eliminating more medical expenses than
they would pay in taxes and requiring higher earners to pay a larger share of
their tab — the standard both Warren and Sanders have argued voters should
apply to their plan.
The
report also grants the assumption of the plan's supporters that the new system
will save some money by making health care more efficient. But the benefits
would vary depending on the individual, and some low-income recipients of
federally backed health care plans could see their costs go up depending on how
it’s financed.
While
Medicare for All proponents have emphasized the lack of premiums in their plan,
the report notes that an average $7,500 mandatory premium per U.S. resident
could pay for it. The premium would rise to an average of $12,000 if it
exempted current Medicare, Medicaid and CHIP recipients.
Proponents
of Medicare for All have offered a menu of options to
help finance their plan, including requiring states and employers to continue
their existing contributions to help offset the cost. Sanders has suggested a payroll
tax, a wealth tax, a financial transactions tax and an increased estate tax,
among others, though the details have not been fully fleshed out and do not
appear to cover the full cost of his plan.
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