The Cost of Bernie Sander’s Healthcare Plan

Bernie Sanders, the longtime independent senator from Vermont, was the other big winner, in last years’ massive political upheaval in the United States. Trump’s victory stunned the world, but at the same time as the Presidential election, there was another major political battle being fought amongst the Democrats.

Medicare For All

Bernie Sander’s Presidential bid, and the controversy surrounding his eventual defeat in the primaries galvanized many on the left to reject the neoliberalism that mainstream Democrats had started to embrace. Many saw this neoliberalism as being far too close to the policies and principles that their opponents on the right were advocating. In other words, liberalism was cozying up to Wall Street and ignoring the plight of those that it was supposed to be protecting the most.

Out of this conflict, there have been two outcomes: a dysfunctional White House that is proving incapable of delivering on the many campaign promises made by Trump, and the other is an energized progressive movement. Senator Sanders has now unveiled his Medicare For All bill; a single payer universal healthcare system. The question is, as always, how does he plan to fund this?

Funding

The bulk of the funding, he proposes, will come from new taxes. For a start, he is advocating for a 7.5% payroll tax, which is expected to generate $3.9 trillion over the next decade (note that these figures have not been verified by the Congressional Budget Office at this time). In order to make this idea easier to sell, Sanders is proposing to exempt a company’s first $2 million in payroll from the tax, which would also protect small businesses. To find out more about the management of healthcare organizations, consider studying for a Healthcare MBA. An online MBA course is a great way of doing this and a number of leading universities, including George Washington University, now offer an online healthcare MBA that rivals the equivalent campus course.

Another proposed source of revenue is a ‘Robin Hood tax’, which will tax the earnings of the top 0.1%. This amounts to around 160,000 people. He also wants to modify the existing estate tax so that it generates more revenue from estates worth $50 million or more.

Costs

Unfortunately, at this point, there still isn’t anything resembling an informed estimate of how much the proposed program will actually cost. If we look to other similar systems around the world we can make estimates, but universal healthcare systems vary between countries and, in fact, Sanders’ proposed system is even more generous than the systems of countries like Canada and Australia.

It is likely going to take a while for the more in-depth financial analyses to be made and for a realistic price tag to be put on the Bernie Sanders’ plan. It seems that some significant tax increases are inevitable, although Sanders argues that Americans will pay more tax in exchange for a functioning and compassionate healthcare system that treats anyone who needs it. Whether that is true remains to be seen.