Koch-backed study finds ‘Medicare for All’ would save U.S. trillions

Addy Baird

Addy Baird Reporter, Think Progress

A single-payer Medicare for All system would reduce the amount the U.S. spends on health care by more than $2 trillion, a Koch brothers-funded study released Monday found.

Research by the Mercatus Center at George Mason University — a libertarian think tank backed by the Koch brothers — projected that the Medicare for All plan championed by Sen. Bernie Sanders (I-VT) would cost the government $32.6 trillion over 10 years. The highly critical report found that even doubling all federal individual and corporate income taxes would not cover the costs of Sanders’ Medicare for All plan.

The study did conclude, however, that Medicare for All would result in significant savings for the government because of lower prescription drug costs, saving $846 billion over the next decade. Streamlined administrative costs under the plan would save another $1.6 trillion, the researchers at the Mercatus Center found.

When we talk about a Medicare for All system, it’s important to discuss the costs in the context of what the U.S. already spends on health care. As of 2016, national health expenditures — which includes federal spending, state Medicaid programs, and private employer health care spending — totaled $3.3 trillion per year, according to the Centers for Medicare and Medicaid Services.

That means that over the next decade, the U.S. is projected to spend more than $33 trillion, plus inflation, on health care services without any changes to our current health care system, significantly more than Mercatus’s estimated $32.6 trillion cost to the federal government over the next ten years.

Sanders’ proposed single-payer plan would be free at the point of service, and would not include any cost-sharing — that is, no co-pays or premiums. Under his plan, taxes would replace those often high costs, which currently are shouldered by patients.

Research from March of this year found that the present system has left 15.5 percent of adults between 19 and 64 without health insurance, while more than a quarter of lower-income families are uninsured. Monday’s study concluded that not only would Medicare for All provide insurance for the millions of Americans currently without coverage, but it would also save the the United States $2.054 trillion over the next decade.

In a comment to Fox News, Sanders took exception to the report’s conclusion Medicare for All would lead to a drastic increase in taxes, calling the study “grossly misleading and biased.” He noted, too, that that the center is funded by the Koch brothers, who known for their fierce advocacy of libertarian policies.

“If every major country on earth can guarantee health care to all, and achieve better health outcomes, while spending substantially less per capita than we do, it is absurd for anyone to suggest that the United States cannot do the same,” Sanders told Fox News.

The immediate response to the Mercatus study focused mostly on its eye-popping $32.6 trillion estimate. Too often, as much of the pundit and politico chatter proved Monday, the cost is where conversations about single-payer both begin and end.

Harping on the costs of the plan without discussing its benefits is a favorite tactic of the right, but centrist Democrats have a history of falling into the same trap. Former Clinton administration adviser Kenneth Thorpe, for example, talked up the high price tag of singer payer as highlighted by the Mercatus analysis Monday.

“It’s showing that if you are going to go in this direction, it’s going to cost the federal government $2.5 trillion to $3 trillion a year in terms of spending,” Thorpe told the Associated Press on Monday. “Even though people don’t pay premiums, the tax increases are going to be enormous. There are going to be a lot of people who’ll pay more in taxes than they save on premiums.”

What no one seems to mention is what that money is paying for.

Ultimately, Sanders’ Medicare for All plan would provide comprehensive coverage for all residents of the United States, including primary and preventative care, emergency and hospital services, maternity and newborn care, prescription drugs, substance abuse and mental health services, as well as pediatrics, laboratory, and diagnostic services. The plan also guarantees dental, vision, audiology, and abortion coverage.

Access to services like primary and preventative care will greatly decrease emergency room overuse, and expansive maternal care might help a country that boasts the unfortunate title of having the worst maternal death rate in the developed world.

The point is this: The resistance to single-payer, especially among establishment Democrats, is really just resistance to changing the status quo. The Democratic party is supposed to be the one that believes government can and should help people. Single-payer, as Monday’s study confirmed, is the best way to do that — while also saving the government trillions of dollars!

The status quo is already changing, anyway. Just two and a half years ago, it was former Secretary of State and future Democratic nominee Hillary Clinton who argued that “people who have health emergencies can’t wait for us to have a theoretical debate about some better idea that will never, ever come to pass.”

The irony, of course, is that in 1994, Clinton said she believed that by the start of the next decade, the U.S. would have a single-payer system. “I don’t even think it’s a close call politically,” she told reporters at the time. “I think the momentum for a single payer system will sweep the country… It will be such a huge popular issue… that even if it’s not successful the first time, it will eventually be.”

At any rate, Sanders’ plan wouldn’t leave people with health emergencies waiting. According to legislation he introduced last fall, Medicare eligibility would expand over the course of four years and slowly transition people from private to fully public health care coverage.

In the first year, people aged 55 and older, as well as those younger than 18 would become eligible for Medicare. The second year, eligibility would extend to people older than 45, and then to people older than 35 in year three. By year four, everyone would be eligible for Medicare.

A slew of possible 2020 Democratic presidential candidates and other high-profile figures in the party have expressed support for the measure now, too. Sanders’ Medicare for All Act of 2017 introduced last September was co-sponsored by Sens. Elizabeth Warren (D-MA) , Brian Schatz (D-HI), Kirsten Gillibrand (D-NY), Cory Booker (D-NJ), Mazie Hirono (D-HI), Kamala Harris (D-CA), Edward Markey (D-MI), Jeff Merkley (D-OR), Tammy Baldwin (D-WI), Sheldon Whitehouse (D-RI), and Richard Blumenthal (D-CT).

Single-payer — and socialism in the United States more generally — got another big boost last month when Alexandria Ocasio-Cortez pulled off an upset victory in her primary against Rep. Joe Crowley (D-NY). Not long after Ocasio-Cortez’s victory, actress-turned-activist Cynthia Nixon, who’s challenging New York Gov. Andrew Cuomo in the state’s upcoming Democratic gubernatorial primary, endorsed Medicare for All, too.

Nixon is one of a dozen candidates for governor across the country who supports a single-payer system. Congressional candidates running this cycle — including Ocasio-Cortez, Kara Eastman in Nebraska and Gina Ortiz Jones in Texas, among others — have already made Medicare for All a winning issue.

Just days before the release of the Mercatus study, Ocasio-Cortez was asked about the costs of a single-payer system in an interview with Daily Show host Trevor Noah. She argued that the problem with instituting single-payer isn’t actually its high cost, but rather a resistance to change.

“A lot of what we need to do is reprioritize what we want to accomplish as a nation,” she said. “Really, what this is about is saying, health care is important enough for us to put first. Education is important enough for us to put first. And that is a decision that requires political and moral courage, from both parts of the aisle. Period.”

This story has been updated to clarify that savings achieved under Sanders’ proposed Medicare for All bill would affect all national health expenditures, including private employers, and state Medicaid programs, not just federal health care spending.

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Reposted from Think Progress

Posted In: Allied Approaches

Union Matters

Get to Know AFL-CIO's Affiliates: National Association of Letter Carriers

From the AFL-CIO

Next up in our series that takes a deeper look at each of our affiliates is the National Association of Letter Carriers.

Name of Union: National Association of Letter Carriers (NALC)

Mission: To unite fraternally all city letter carriers employed by the U.S. Postal Service for their mutual benefit; to obtain and secure rights as employees of the USPS and to strive at all times to promote the safety and the welfare of every member; to strive for the constant improvement of the Postal Service; and for other purposes. NALC is a single-craft union and is the sole collective-bargaining agent for city letter carriers.

Current Leadership of Union: Fredric V. Rolando serves as president of NALC, after being sworn in as the union's 18th president in 2009. Rolando began his career as a letter carrier in 1978 in South Miami before moving to Sarasota in 1984. He was elected president of Branch 2148 in 1988 and served in that role until 1999. In the ensuing years, he worked in various roles for NALC before winning his election as a national officer in 2002, when he was elected director of city delivery. In 2006, he won election as executive vice president. Rolando was re-elected as NALC president in 2010, 2014 and 2018.

Brian Renfroe serves as executive vice president, Lew Drass as vice president, Nicole Rhine as secretary-treasurer, Paul Barner as assistant secretary-treasurer, Christopher Jackson as director of city delivery, Manuel L. Peralta Jr. as director of safety and health, Dan Toth as director of retired members, Stephanie Stewart as director of the Health Benefit Plan and James W. “Jim” Yates as director of life insurance.

Number of Members: 291,000 active and retired letter carriers.

Members Work As: City letter carriers.

Industries Represented: The United States Postal Service.

History: In 1794, the first letter carriers were appointed by Congress as the implementation of the new U.S. Constitution was being put into effect. By the time of the Civil War, free delivery of city mail was established and letter carriers successfully concluded a campaign for the eight-hour workday in 1888. The next year, letter carriers came together in Milwaukee and the National Association of Letter Carriers was formed.

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