So there are really two parts to Warren’s Medicare for All financing plan. The first is how she estimates the total cost of M4A. Props to the Warren campaign for being detailed and clear in their assumptions here.
Warren gets a cost estimate in line with current national health spending by assuming deep cuts to physician, hospital, and drug pricing; trillions in savings from payment reforms like bundled care and ACOs, and slower health spending.
That lets her claim an amazing deal: Her plan will “cover every single resident of the U.S. with much more generous coverage and virtually no cost sharing at a total cost just under the amount the U.S. is currently set to spend on health care under our existing system.”
How convincing you find the estimate relies on how realistic you think these policies and projections are. I go into more detail on some of them in the piece. vox.com/2019/11/1/2094…
But that gives Warren a $52 trillion baseline for national health expenditures over 10 years. She then redirects almost all federal, state, and local health care spending, leaving a $20 trillion hole.
Her next move is the key one: Medicare for All usually requires middle-class tax increases because you’re replacing the trillions employers spend on health premiums. She freezes those trillions in place, and has employers send those checks to the government.
This has weird consequences. It effectively punishes employers who pay for more expensive health care now, as they’re still paying more than their competitors, but without an advantage in recruiting. Warren says she’ll adjust them to an average over time.
The problem is worse for businesses <50 employees, who she says are exempt unless they pay for employee health care now. Around half do, and so they’ll be paying a cost their competitors don’t, with no advantage in the benefits they offer.
And then she adds a financial transactions tax, a minimum tax on foreign corporate earnings, a supercharged wealth tax on assets over a billion dollars, a massive increase in IRS enforcements, defense cuts, and comprehensive immigration reform.
I don’t think every assumption in this plan is convincing, but the net effect of it is Warren now has a plan, and knows how it works, much better than the Dems who were criticizing her on stage. And the plan is filled with goals the more incremental plans don't meet.
To argue against it, you have to argue that we either can't get these savings from health providers, or shouldn't tax the rich and corporations at these levels.
And then you have to explain why your plan, which in most cases doesn't get to full universal coverage, is acceptable.
And then you have to explain why your plan, which in most cases doesn't get to full universal coverage, is acceptable.
Warren hated not having answers at the last debate, and now she’s got both answers and counterattacks — and has clearly done a ton of work with staff to break down the issue so she knows how to debate and explain it.
I've said this for a long time, but the advantage Warren's plans actually give her is they're the structure in which she the works through the issue herself, and that gives her the knowledge base to outargue the other candidates, convincingly answer voter questions, etc.
