Billionaires are up in arms about her plans to tax their wealth, which is one of the elements of her plan to pay for Medicare for All. One of the aggrieved billionaires, hedge fund manager Leon Cooperman, wept on CNBC’s “Halftime Report” Nov. 4 at the thought that Warren might become president and make him pay higher taxes. Jamie Dimon, CEO of JPMorgan Chase, chided Warren for using “some pretty harsh words, you know, some would say vilifies successful people.” Then billionaire Michael Bloomberg announced he was weighing the possibility of jumping into the Democratic primary field, apparently because he was not impressed with the selection.
There is no apparent groundswell of support for Bloomberg, who served two terms as a mayor of New York City from 2001 to 2009 as a Republican before switching to independent to run for a third term in 2009. But he decided he’s the only one who can beat Trump on the Democratic ticket.
Health industry executives are really scared at the threat Warren and Bernie Sanders represent to their billions of dollars in profits, so they’re lining up funds to brainwash the electorate into believing that it is impractical to expand Medicare to cover everybody.
As former insurance executive Wendell Potter notes in our cover story, big insurance, drug and hospital companies have hired a PR firm to create and run a front group called the “Partnership for America’s Health Care Future,” which, with allies such as the Committee for a Responsible Federal Budget, will work to convince voters that expanding Medicare to cover everybody can’t be done without a significant tax hike on middle-income earners. And the propaganda seems to work.
In January 2019, a national poll released by the nonpartisan Kaiser Family Foundation found that two-thirds of Americans support a national health insurance program that would eliminate premiums and reduce out-of-pocket expenses and they supported “Medicare for All” 56% to 42%.
But when they were told that a government-run system could lead to delays in getting care or higher taxes, support plunged to 26% and 37%, respectively. Support fell to 32% if it would threaten the current Medicare program.
That represents the power of lying — and misrepresenting what Medicare for All would do is the last refuge of the health industry scoundrels. In fact, the proposals by Sens. Sanders and Warren would improve the current Medicare program for seniors, as well as younger Americans, by making it comprehensive, covering everybody and doing away with co-pays and deductibles — and they could accomplish it by simply re-routing through Medicare money that now is spent on insurance premiums.
Warren produced a plan on Nov. 1 that would pay for Medicare for All with higher taxes on businesses, financial firms, wealthy Americans and corporations that would essentially replace the premiums American businesses and individuals now spend on private insurance. Bernie Sanders would pay for the Medicare expansion with a 7.5% payroll tax on businesses and 4% tax on workers’ income.
Warren noted that families are getting crushed by health costs. For years she studied bankruptcies and found that the number one reason families were going broke was because of medical bills they could not pay — and three quarters of those who declared bankruptcy after an illness were people who already had health insurance. No other industrialized nation has this problem.
An average family of four with employer coverage spends $12,378 per year on health care, Warren noted. This includes employee premium contributions and out of pocket costs in 2018. And the figure has increased every year. The family would pay $844 under Sanders’ plan and nothing under Warren’s plan.
Employers who now provide coverage for their workers would also see savings. They now pay, on average, $5,500 toward each employee’s annual premium and $750 in Medicare payroll tax for an employee earning $50,000 annually. Under Sanders’ plan the employer’s cost would decline to $3,750 for an employee who earned $50,000. And skinflint employers who don’t provide insurance for their workers would finally have to ante up. Warren expects businesses to pay slightly less than what they currently pay for health care, but she would exempt firms with less than 50 employees. Sanders would exempt the first $2 million of payroll.
Of course, ultimately the tax structure to support Medicare for All would be up to Congress, starting with the House Ways and Means Committee.
Critics use 10-year totals to scare voters, claiming that expanding Medicare to cover everybody could cost $35 trillion over the next decade, but we’re already at that spending level, as the US spent $3.65 trillion, or $11,121 per person, in 2018, according to Centers for Medicare & Medicaid Services. Warren’s plan counts on cost savings, which gets a skeptical reaction from critics, but there appears to be plenty of room for savings as the US already spends twice as much, per person, as Canada and most other countries that have national health care — and that’s while leaving 87 million Americans uninsured or underinsured. (The next-biggest spender is Germany, whose $5,986 average expenditure is 53.8% of the US average, according to the Organization for Economic Cooperation and Development.)
Nearly 60% of our health care costs already are paid from public money that finance Medicare, Medicaid, the Veterans Administration, coverage for public employees, elected officials, military personnel and so forth.
One-third of the nation’s health care spending go to private health insurance premiums paid by businesses and individuals. Another 10% of health care spending came directly from the pockets of Americans on copays and deductibles.
And administrative costs, much of which are spent on billing and paperwork, take up approximately a quarter of health-care revenues in the US, Drs. Stephanie Woolandler and David Himmelstein reported in 2017. They estimate that single-payer reform could save approximately $503 billion annually in administrative costs.
Spending on hospitals, doctors and other clinic services was $2.16 trillion, holding steady at 59% of total health care spending.
National health care is by no means a radical program. It has been a Democratic priority since President Franklin D. Roosevelt included “The right to adequate medical care and the opportunity to achieve and enjoy good health” in the Second Bill of Rights he proposed in his State of the Union address on Jan. 11, 1944. Harry Truman called for universal health care as part of his Fair Deal proposal in 1949, but conservatives blocked it in Congress. When Lyndon Johnson finally got Congress to approve Medicare in 1965 as part of his Great Society program, the plan was to start offering health coverage to seniors aged 65 and older. Then, in succeeding years, the eligibility age was supposed to move down to eventually cover everybody.
With Donald Trump at historic levels of unpopularity, and several vulnerable Republicans up for re-election in the Senate, Democrats have an historic opportunity to move ahead on finally closing the gap on Medicare. If it takes vilifying a few billionaires who don’t want to do their part, so be it. — JMC
From The Progressive Populist, December 1, 2019
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