Viewpoint: Warren undermines her candidacy with convoluted Medicare for All financing proposal

Karen Rubin

Elizabeth Warren (who I strongly favor to be the next president) is on wrong track with her announced plan to finance Medicare for All.

Like the unfortunate situation Obama found himself, she twists herself into pretzels in order to fit a square widget into a smaller round hole. But there is a more obvious, “elegant” solution than her convoluted one to fulfill the goal of affordable, universal health care.

But at least Warren, alone among the candidates including Trump, has provided details of a plan, when Americans say that health care is their number one issue in the 2020 election, inviting intense criticism and opposition from Democrats and Republicans (Socialist!) alike.

The problem is clear: 87 million Americans are uninsured or underinsured; 36 million skipped a test, treatment or follow-up because of costs; 37 million Americans can’t afford their prescription drugs; Americans pay two or three times what other industrialized countries pay with outcomes that are not much better than in Third World countries; 30,000 people a year die prematurely for lack of access to care; 67 percent of all bankruptcies – 530,000 families a year – are tied to medical issues, either because of crushing debt or time out of work.

Health care spending amounts to 18 percent of total gross domestic product. Spending grew by 3.9 percent in 2017 when the inflation rate was 2.2 percent, hitting $3.5 trillion, or $10.739 per person. Until Obamacare put caps on costs, health insurance premiums were rising at four times the rate of inflation each year.

Americans spent $333 billion – $1,220 per person – for prescription drugs in 2017. The top 10 Big Pharma companies pocketed $101 billion in profit in 2018, with the 10 CEOs collecting $140.5 million in pay that year.

On top of the $10,739 per person in health care spending, people also pay into Medicare – that is, future health care – with FICA taxes. Presently, the Medicare portion is 1.45 percent if matched by the employer, or if self-employed, 2.9 percent; plus an extra 0.9 percent on incomes over $200,000 a year.

Elizabeth Warren and Bernie Sanders have never explained why their Medicare-for-All plan requires ending private insurance – which has engendered most of the hysteria – though Warren’s plan depends upon employers continuing to collect their contribution, $1 trillion worth, but sends it to the government.

Solving the conundrum of affordability and accessibility and delivering true health care for all must be through a combination of cost savings and making Medicare Available to All, because there is already an established system of paying premiums to CMS and paying for Medicare through taxes.

Here’s a simpler, more elegant solution:

First: get rid of the ridiculous expectation that Democrats have foisted, that universal health care will be free.

Health care is not free. Medicare is not free. On top of all that retirees have paid into the system, we pay monthly premiums with surcharges on higher incomes, in addition to supplementary insurance, coverage for drugs, and that doesn’t even cover vision, dental, hearing or long-term care. I estimate I pay out $5,000 a year for one person plus $3,000 for long-term care insurance.

The answer – in health care, hospitals and drug costs – is to use the model of public utilities – private companies that pay private salaries, but which nonetheless have to justify fair and transparent pricing that returns a reasonable, not extortionist, rate of return.

Medicare Available to All – which eventually would likely replace private insurance because of its superior benefits – should be paid for with a separate premium, which already has a progressive element based on income – just as Medicare recipients (not Medicare Advantage) do now. This would avoid any of the Republican constitutional challenges such as they waged against the individual “mandate”.

Medicare Available for All would be voluntary and paid for using the existing mechanisms. But the taxes should be charged on all income, not just wages, and the surcharge on higher incomes could be raised.

The government should guarantee a reasonable level of care – wellness exams, vaccinations, regular mammography and colonoscopy – and life-saving treatments and drugs.

Above that, people can buy supplemental insurance or pay on their own for such things as cosmetic surgery and such. Address the fear of “rationing” and long waits by producing more doctors, more physician assistants, more registered nurses empowered to give basic care, more clinics and more e-medicine.

The reality is that the rich will still be able to buy better access and personalized care, through Concierge Medicine and VIP programs, such as already happens in the Medicare Capital, Fla.

But instead of frightening people even more intensely than when Obama was introducing the Affordable Care Act (and amazingly, now supported by vast majorities) – and the hysteria when people realized that just as before, insurance companies and employers decide what doctors are included for coverage – Warren is making universal health care much more terrifying than it needs to be and torpedoing her own candidacy.

Biden, who sits comfortably behind the idea that he would simply expand on Obamacare by adding a public option fails to take into account how Trump and the Republicans have sabotaged it. Biden hasn’t said how he would improve upon Obamacare, pay for the subsidies or get the Red States on board with expanding access to Medicaid.

Elizabeth Warren has been flawless up until now – her character and her campaign unimpeachable. But her Medicare for All plan gives her opponents – especially Joe Biden, Pete Buttigieg and Amy Klobuchar – the one thing that will be used to tear her down, through repetition, extrapolation, exaggeration and fabrication.

But with health care being the number one issue of concern for 2020 voters, her plan will trip her up for the same reason it tripped up Obama: it’s too much of a Rube Goldberg device in order to controvert those who would block it entirely.


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