“Giant corporations and billionaires are going to pay more [under Sanders’s Medicare-for-all plan]. Middle class families are going to pay less out of pocket for their health care.”
— Sen. Elizabeth Warren (D-Mass.)
This isn’t as straightforward as Warren makes it sound.
Sanders has put out a menu of possible options for how to fund Medicare-for-all, though many experts says that he still falls short.
One option would require a 7.5 percent payroll tax that employers would pay to help fund the program. Virtually every economist will tell you that a payroll tax paid by an employer largely comes out of the pay earned by the employee, but Sanders argues that the savings on the premiums currently paid by the employer should result in an overall reduction in costs for the employer. He estimates that a company would save more than $9,000 in health-care costs per average employee. (We do not vouch for these numbers.)
Another option is a 4 percent income-based premium paid by households, starting at $29,000. Sanders has estimated that this would raise $3.5 trillion over 10 years, but the “typical middle-class family” would save more than $4,400 a year. Sen. Kamala Harris (D-Calif.), a 2020 rival, has objected that this would amount to a tax increase on the middle class and has proposed to raise the threshold for paying the tax to $100,000. Instead she would impose a new tax on stock and bond trades.
Still, health care amounts to one-sixth of the U.S. economy. And when changing anything that large, there is really only one certainty: There will be unintended consequences. Medicare-for-all would involve disruption in the health-care market much larger than what the United States experienced with the implementation of the Affordable Care Act, Medicaid or the original implementation of Medicare.