WASHINGTON – Sen. Bernie Sanders & # 39; Medicare for all "Plan would increase government spending on health by $ 32.6 trillion over 10 years, according to a study by a university-based libertarian policy center.
That's Billion with a T.
Independent Vermont's latest plan would require historic tax hikes as the government replaces what employers and consumers now pay for health care, according to analysis released Monday by the Mercatus Center George Mason was published in Virginia University. It would lead to significant savings in administrative and pharmaceutical costs, but increased demand for care would drive up spending, the analysis said.
Sanders & # 39; Plan builds on Medicare, the popular insurance program for seniors. All US residents would be covered with no copays or deductibles for medical services. The insurance industry would be reduced to a subordinate role.
"The introduction of something like" Medicare for all "would be a transformative change in the size of the federal government," said Charles Blahous, author of the study. Blahous was a senior economic advisor to President George W. Bush and a public trustee of Social Security and Medicare during the Obama administration.
In response to the study Sanders aimed at the Mercatus Center, which is financially supported by the conservative Koch brothers. The Koch Industries CEO, Charles Koch, is on the board of the center.
"If every major country on earth can guarantee health care for all and achieve better health outcomes while spending significantly less per capita than we do, it is absurd for anyone to claim that the United States can not do that." Sanders said in a statement. "This grossly misleading and biased account is the Koch brothers' response to growing support in our country for a Medicare for All program."
Sanders office did not conduct a cost analysis, a spokesman said. However, Mercatus estimates are in line with other cost forecasts for Sanders 'plan for 2016.
Sanders' staff found an error in a first version of the Mercatus report that included a long-term care program in the 2016 proposal but not was included in the current offer. Blahous corrected it and reduced his estimate by about $ 3 trillion in 10 years. Blahous says the report is his own work, not that of the Koch brothers.
Called "single payer" over the years, "Medicare for all" reflects Liberals long-held desire for a government-led system that covers all Americans.
The idea gained broad grassroots support as Sanders ran in the democratic primaries of the Democratic president in 2016. With a view to the election in 2020, the Democrats are debating whether the single-payer should be a "litmus test" for national candidates.
The Mercatus analysis estimated the 10-year "Medicare for All" from 2022 to 2031 after a first phase. The results are similar to those of several independent studies of the 2016 Plan by Sanders. These studies estimated the increase in public spending over 10 years from $ 24.7 trillion to $ 34.7 trillion.
Kenneth Thorpe, a professor of health policy at Emory University in Atlanta, who was previously a senior health adviser to the Clinton administration, wrote one of these studies and said the Mercatus analysis strengthened it.
"It shows that if you go in that direction, it will cost the federal government $ 2.5 trillion to $ 3 trillion a year," Thorpe said. "Although people are not paying premiums, the tax hikes will be enormous, and there will be a lot of people paying more taxes than saving premiums."
The study by Mercatus challenges an important cost-saving function of the plan: hospitals and physicians would accept payments based on low Medicare rates for all their patients.
The study found that the plan would bring significant savings through lower prescription costs – $ 846 billion over 10 years – as the government would negotiate directly with drug manufacturers. The savings from the streamlined administration would be even greater at nearly $ 1.6 trillion.
But other provisions would tend to increase spending, including cover for nearly 30 million uninsured persons, no deductibles or copayments, and improved benefits, including dental, sight and hearing.
After taking into account current government health financing, the study estimated that doubling total federal and corporate income tax would not fully cover the additional costs.