A new study says legislation that has been repeatedly introduced to expand Medicare to everyone in America would save $1.8 trillion over the next decade.
The legislation is the Expanded & Improved Medicare For All Act, U.S. House Bill 676, which according to news reports has been introduced for 11 years straight. The bill, which has been in committee since February, currently has 48 co-sponsors, all Democrats.
“Improved Medicare for All would cost less for 95 percent of households and reduce the deficit by $154 billion in the first year,” says study author Gerald Friedman, professor in the department of economics of University of Massachusetts at Amherst.
Savings would come, Friedman said, from “slashing the administrative waste associated with the private insurance industry ($476 billion) and reducing pharmaceutical prices to European levels ($116 billion).” And in 2014 they would be “enough to cover all 44 million uninsured and upgrade benefits for everyone else,” including eliminating co-payments and deductibles.
The study assumes the following funding:
• Existing sources of federal revenues for health care
• Tax of 0.5 percent on stock trades and 0.01 percent tax per year to maturity on transactions in bonds, swaps, and trades
• 6 percent high-income surtax (applies to households with incomes > $225,000)
• 6 percent tax on unearned income from capital gains, dividends, interest, profits and rents
• 6 percent payroll tax on top 60 percent of income earners (applies to incomes over $53,000, tax paid by employers)
• 3 percent payroll tax on the bottom 40 percent of income earners (applies to incomes under $53,000, tax paid by employers)
• Continuation of the new Medicare taxes included in the Affordable Care Act of 2010
• 20 percent of the current individual out-of-pocket spending