Bernie’s Healthcare Plan is Here

Filed in National by on January 18, 2016

medicare_for_all

Bernie Sanders unveiled a plethora of detail about his “Medicare for All” plan yesterday, including tax information explaining how it will be paid for. At a cost of $1.38 trillion per year, the single payer plan would provide for all needs across the continuum of care. Absolutely everything in healthcare would be covered.  Some details:

Major Savings for Families and Businesses

Bernie’s plan will cost over $6 trillion less than the current health care system over the next ten years.

The United States currently spends $3 trillion on health care each year—nearly $10,000 per person. Reforming our health care system, simplifying our payment structure and incentivizing new ways to make sure patients are actually getting better health care will generate massive savings. This plan has been estimated to save the American people and businesses over $6 trillion over the next decade.

The typical middle class family would save over $5,000 under this plan.

Last year, the average working family paid $4,955 in premiums and $1,318 in deductibles to private health insurance companies. Under this plan, a family of four earning $50,000 would pay just $466 per year to the single-payer program, amounting to a savings of over $5,800 for that family each year.

Businesses would save over $9,400 a year in health care costs for the average employee.

The average annual cost to the employer for a worker with a family who makes $50,000 a year would go from $12,591 to just $3,100.

The Plan Would Be Fully Paid for by:

A 6.2 percent income-based health care premium paid by employers.
Revenue raised: $630 billion per year.

A 2.2 percent income-based premium paid by households.
Revenue raised: $210 billion per year.

This year, a family of four taking the standard deduction can have income up to $28,800 and not pay this tax under this plan.

A family of four making $50,000 a year taking the standard deduction would only pay $466 this year.

Progressive income tax rates.
Revenue raised: $110 billion a year.

Under this plan the marginal income tax rate would be:

  • 37 percent on income between $250,000 and $500,000.
  • 43 percent on income between $500,000 and $2 million.
  • 48 percent on income between $2 million and $10 million. (In 2013, only 113,000 households, the top 0.08 percent of taxpayers, had income between $2 million and $10 million.)
  • 52 percent on income above $10 million. (In 2013, only 13,000 households, just 0.01 percent of taxpayers, had income exceeding $10 million.)

Taxing capital gains and dividends the same as income from work.
Revenue raised: $92 billion per year.

Warren Buffett, the second wealthiest American in the country, has said that he pays a lower effective tax rate than his secretary. The reason is that he receives most of his income from capital gains and dividends, which are taxed at a much lower rate than income from work. This plan will end the special tax break for capital gains and dividends on household income above $250,000.

Limit tax deductions for rich.
Revenue raised: $15 billion per year

Under Bernie’s plan, households making over $250,000 would no longer be able to save more than 28 cents in taxes from every dollar in tax deductions. This limit would replace more complicated and less effective limits on tax breaks for the rich including the AMT, the personal exemption phase-out and the limit on itemized deductions.

The Responsible Estate Tax.
Revenue raised: $21 billion per year.

This provision would tax the estates of the wealthiest 0.3 percent (three-tenths of 1 percent) of Americans who inherit over $3.5 million at progressive rates and close loopholes in the estate tax.

Savings from health tax expenditures.
Revenue raised: $310 billion per year.

Several tax breaks that subsidize health care (health-related “tax expenditures”) would become obsolete and disappear under a single-payer health care system, saving $310 billion per year.

Most importantly, health care provided by employers is compensation that is not subject to payroll taxes or income taxes under current law. This is a significant tax break that would effectively disappear under this plan because all Americans would receive health care through the new single-payer program instead of employer-based health care.

Check out all the specifics here: https://berniesanders.com/issues/medicare-for-all/

This would be a golden opportunity for Democrats to take the message of liberating employers from carrying insurance for their employees and run with it. This plan would also create the largest collective bargaining unit ever consisting of all Americans and give the federal government the power to negotiate prices for healthcare services with providers, which would go a long way to lassoing healthcare costs and bringing them back to earth.

If you’re a Bernie fan, or a fan of single-payer or universal healthcare, this is something you’ve been waiting for.

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About the Author ()

A dad, husband, and public education supporter. Small tent progressive/liberal. Christina School District Citizen's Budget Oversight Committee member, who knows a bit about a lot when it comes to the convoluted mess that is education funding in the State of Delaware.

Comments (6)

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    • I don’t think anyone is saying health reform is supposed to be easy, especially not after decades of tilting the scales towards for-profit insurance companies. However, I’m not comfortable with doing nothing (nor am I suggesting you are, John). There isn’t a magic wand to wave that will transform our system overnight but one of Bernie’s biggest criticisms is “SINGLE PAYER?! PPFFFT, how are you going to pay for THAT?!” Hillary’s own daughter basically stood on stage and said Bernie’s plan is going to financially ruin the country and no one had even seen it yet. And well, here he lays some specifics as to how to pay for it in ways that won’t destroy us. Will it happen immediately upon his election as president? No way, because Congress is involved. But it can be done. And the discussion over how to do it keeps on pushing the national conversation to the left.

      By the by, this part of the post you linked:

      But to get costs down to, say, Canadian levels, we’d need to do what they do: say no to patients, telling them that they can’t always have the treatment they want.

      …which is exactly what our system does now. Insurances deny coverages all the time and the patient is left to either pay full cost or not get the treatment. And yet, healthcare costs continue to skyrocket.

      A transition to Single payer is going to be hard. Saying “it won’t work” is easy.

  1. cassandra_m says:

    I’m a Bernie fan and I’m a single-payer fan. That said, this isn’t Medicare-for-All if there are no deductibles or copays. And this piece makes some claims for cost containment that don’t seem realistic. Frankly, I think that if there is somehow single payer tomorrow, it *will* be more expensive in the short term, until cost savings can be absorbed into the system.

    Bernie Sanders’s single-payer plan isn’t a plan at all

  2. May I suggest you read Paul Krugman’s blog regarding Sander’s plan. It is not
    as good as you think politically. Even though Krugman favors single payer he recognizes that it does entail raising taxes and some “rationing” of health care.
    As Mick Jagger might say to patients: “You can’t always get what you want”.
    This plan will not fly or get through a Congress, especially one headed by GOP. The GOP will bash the plan as rationing with tax increases. DOA. I think it better to stick with Hillary and put in improvements to Obamacare.

  3. Christy says:

    It would be fantastic if healthcare costs were cheaper. We’ve seen the battle President Obama has had over the past 8 years, I’m not sure it’s possible to get Congress to agree on anything. Forehead. Wall.