South Florida Sun Sentinel (FL) November 19, 2019
Commentary
For any
problem, Sen. Elizabeth Warren likes to say, “I have a plan for that.” Her plan
to finance “Medicare for All” doesn’t add up. Not even close. Perhaps that’s
why Warren is changing that plan.
Warren
may deserve credit for trying. Sen. Bernie Sanders, who sponsored one of the
Medicare For All bills, hasn’t tried to explain how he would pay for this
transformation of the American health care system that would abolish private
insurance. Voters associate Sanders much more with the idea.
Presidential
candidates Warren and Sanders, however, are competing for the same
ultra-liberal Democratic voters. Warren has been rising in the polls. So she
didn’t merely embrace Medicare For All. She tried to own it.
But
Warren’s math shows that the plan relies on unrealistic assumptions. Her
calculations also undermine Sanders’ claim that even though taxes would rise
for all Americans under Medicare For All, the middle class would come out ahead
because they would save even more.
Based
on a reading of Warren’s plan and several credible analyses, here are the
numbers:
According
to the left-leaning Urban Institute, Medicare For All would cost the federal
government an additional $34 trillion over 10 years. Warren starts by claiming
to reduce that number to $20.5 trillion.
To get
there, Warren diverts $6.1 trillion that states now spend on health care.
Getting that money could require a lawsuit. Then she relies on the first of
those shaky assumptions.
Warren
assumes that Medicare For All would reduce the cost of prescription drugs by
$1.7 trillion. That’s far more than what outside analysts -- including those at
the Urban Institute -- have concluded.
Warren
also assumes that health care spending would slow by $1.1 trillion over those
10 years. Even though the rate of growth has slowed under the Affordable Care
Act, Warren’s estimate assumes much more in savings.
She
predicts a savings of $1.8 trillion from lower administrative spending without
private insurance expenses. Again, that’s higher than other estimates. She
assumes that payments to doctors and hospitals would decline by almost $3
trillion. But setting those lower rates would be a huge political fight, and
providers who opposed them might stop seeing patients.
Problems
continue with finding that $20.5 trillion in revenue. Warren starts with $9.8
trillion from companies with employees of at least 50 employees. That’s the
money they spend now on Medicare Part A payments, with employees paying the
other half.
From
there, Warren has to scramble. She relies on $3 trillion from her 6 percent tax
on the wealthiest Americans. But tax avoidance likely would reduce that amount,
and Warren also has proposed spending revenue from that tax on other programs.
Warren
further assumes that tougher tax enforcement would increase revenue by $2.3
trillion. That is 40 times higher than what the IRS estimates. She would seek
more revenue from companies by repealing the corporate-friendly 2017 tax bill.
Congress would have to act first.
For the
rest, Warren would impose a tax on Wall Street, cut defense spending and reform
immigration. She said immigration reform, which couldn’t even get a House vote
in 2013, would save $400 million.
Linda
Blumberg is a health economist with the Urban Institute. She co-wrote the
group’s analysis of Warren’s math. “We felt we were making pretty optimistic,
aggressive assumptions," Blumberg told The Washington Post. “They're
making more optimistic, more aggressive assumptions.”
Indeed,
Warren and Sanders both are being dangerously unrealistic. They contend that
Medicare For All could offer more benefits than single-payer health care plans
in other countries without any of the trade-offs that are aspects of those
plans, such as longer waits to see some physicians and higher taxes.
You can
see why Democrats want to campaign on health care. The issue helped them take
the House last year. Americans regularly complain that their policies cost more
but cover less.
Yet few
support Medicare For All as Warren and Sanders envision it. Last February, a
poll commissioned by The Hill newspaper found that only 13 percent of
respondents wanted a single-payer program if it meant abolishing private
insurance.
A
better idea for those under 65 would be a “public option” -- government-run
coverage that would compete with private plans. Some people might take the
public option and buy a private, supplemental policy.
Warren
now says that she would first seek to create that public option and to lower
the Medicare age from 65 to 50. Not until the third year of her presidency
would she “transition” to Medicare For All.
Warren’s
change comes just before Wednesday night’s Democratic debate. It acknowledges
that rival Pete Buttigieg has been gaining strength among moderate Democrats
who want to build on the Affordable Care Act.
In
contrast, Medicare For All is the health care equivalent of stopping a speeding
car on I-95 by pulling the parking brake. It’s true that Republicans have only
a bad plan on health care -- repealing the Affordable Care Act without a
replacement. But the Democratic alternative should be a good plan, not Medicare
For All.
Editorials
are the opinion of the Sun Sentinel Editorial Board and written by one of its
members or a designee. The Editorial Board consists of Editorial Page Editor
Rosemary O’Hara, Sergio Bustos, Steve Bousquet and Editor-in-Chief Julie
Anderson.
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the Sun Sentinel (Fort Lauderdale, Fla.)
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