Warren’s Medicare-for-All plan is a disaster

Elizabeth Warren has unveiled the blueprint for her Medicare-for-All plan and it makes very clear why she avoided transparency on the matter until now.

Over the next decade — by her own estimate — WarrenCare would cost more than $52 trillion. That includes $20 trillion in new federal spending. As a benchmark, consider that the entire federal budget is currently around $4 trillion each year.

The key feature is that Warren claims she can come up with this new $20 trillion without raising taxes “one penny” on the middle-class.

So what does that leave?

Well, to start with, to even get to the $20 trillion number, Warren assumes massive increases in efficiency under Medicare for All, both by eliminating private insurers and all of their administrative costs entirely, as well as streamlining the billing process for providers.

Of course, for any American who has ever needed so much as a driver’s license, much less required actual payment from a government agency, the idea that a federal bureaucracy will improve the efficiency and lower the costs of a payment process is ludicrous in the extreme.

Warren points to the current Medicare program’s relatively low 2.3% in administrative costs, and assumes this will carry over to her entire plan. This common Medicare-for-All talking point simply doesn’t hold up to serious scrutiny given that Medicare is able to outsource tax collection to the IRS, premium collection to the SSA, and accounting, auditing and more to HHS. In addition, the low percentage is partially a function of the high cost of caring for older patients, and one 2005 study found that Medicare in fact had higher per-beneficiary administrative dollar costs than private insurance.

Moreover, Warren’s fantastical plan relies on reimbursing all doctors and hospitals at or below 110% of current Medicare rates, rates which two-thirds of providers say don’t even cover their costs to provide the care. To wave away the very real threat of mass hospital closings with promises of improved efficiency is beyond disingenuous.

Suffice it to say, the mythical creature of Warren’s hypothetical administrative savings are unlikely to emerge from the swamp of Washington, D.C. and $20 trillion in new taxes is likely nowhere close to enough to cover the cost of the program.

But where does she plan to get the $20 trillion? Taxes, taxes, taxes.

The biggest and most creative new tax comes from redirecting employer-paid insurance premiums from private companies to the federal government, generating $9 trillion in new tax revenue over the next 10 years.

It is inconceivable that these trillions and trillions in new taxes will not be passed on to the middle class, whether in higher consumer prices or in lower pay, no matter what “mathematical gymnastics,” as the Biden campaign called it, Warren uses to pretend otherwise.

Health care for all is a laudable concept. To give every American access to affordable, quality care comes from a place of human compassion, but honest people can disagree about the best way to achieve that. The American system, while high in cost, provides the best and most innovative care in the world to an enormous and diverse population, over 90% of which currently has health care coverage.

To propose to take a sledgehammer to that system on the strength of unserious revenue promises and magical thinking does a disservice to the American people.

from Boston Herald https://ift.tt/34oExq8