This is more of a way for me to gather my own thoughts, but I figured I might as well jot them down here and see what y'all think. Before I get started here, I just want to say I'm nowhere near an expert on healthcare or health insurance nor do I have all the data that I'd need to make a real policy proposal. I'm really just spit balling here with an idea I've had floating around in my head for a while now. So here we go.
One thing we all know when it comes to Medicare for All is that is saves money. Every study that has been done on the subject has shown that a single payer healthcare system would cut down on the overall cost of healthcare in this country while covering everyone. That is perhaps the biggest selling point on the issue. Right now, I think the most vulnerable part of our argument is the the question of "what specific taxes will you employ to actual pay for it?" I think that's a question that should be answered after extensive research and debate among tax policy experts, but Bernie needs to have an adequate response to it right now. Currently, I personally don't think his answers and proposals to the question of "how do you pay for it?" have been particularly convincing. They rely on a variety of taxes that aren't easy to explain in an interview or on the debate stage. It's also fair to say that even after all those taxes, we don't get to the number we need.
So how do we get there? I think we need to focus on how healthcare is being paid for now, and then replace those methods with new methods that would cause the least disruption to your everyday American. Right now, I'm just going to look at the average American, who pays $ 10,600 for healthcare per year. About $ 2000 of that is in out-of-pocket premiums, about $ 6000 of that is in lost-wages from employers paying premiums, and the rest is generally paid on the back end through deductibles, copays, coinsurance, and out-of-pocket expenses (especially for uninsured Americans). That is way oversimplifying it, but bear with me. Those back end expenses are what cause the 500,000 medical-related bankruptcies each year. We make the sick pay an ungodly proportion of our healthcare costs. The goal with Medicare for All is to get rid of those back end costs, to make healthcare "free at the point of service." The problem here is that all the back-end costs are now front-end costs, which means that those who don't have many medical issues throughout the year are now paying more. The healthy would no longer be subsidized by the sick. However, its possible (even likely) that all of those increased front-end costs could be offset by the tremendous efficiency savings that a single-payer system would have.
So now let's get to the point. How do we pay for it? In order to sell this policy to the American people, we need to make the tax simple, effective, and not too disruptive. That is why I think we should pay for medicare for all in a similar way to how we currently pay for the front end costs of our current system, except we make it more progressive. The payroll tax is the best way to do that. Like I said earlier, most Americans with employer-based coverage pay about $ 2000 in premiums with their employer paying about $ 6000 in premiums. Add to this the Medicare tax which costs your average employee and employer $ 700 annually and you have $ 2700 in direct costs to the employee and $ 6700 in costs to the employer. This remains roughly the same for even high-income individuals, so this is in no way a progressive way to pay for healthcare. Under Medicare for All, those private premiums are eliminated. A payroll tax replaces those premiums in a somewhat progressive way.
The Specifics: A payroll tax where the employee pays 5% and the employer pays 15%. Your median worker making $ 47000 would be paying around $ 2350 in direct taxes (compared to ~$ 2700 before) and the employer would be paying around $ 7050 (compared to ~$ 6700 before). As you can see, these numbers are comparable to our current front-end costs except you are now part of a system where everyone is covered and you will have to pay nothing on the back end. According to my admittedly rough calculations, that tax alone would generate about 2 trillion dollars per year. For comparison, if the US's healthcare system was as efficient as Canada's per capita, we would only need 1.6 trillion dollars to cover everybody. While that's possible, I think it's unlikely we can drive down costs that much, but 2 trillion dollars in revenue is a great place to start. If more revenue is needed, you can look at other taxes to piece together the rest or you can consider having some back end costs. Of course there are probably a thousand little details that I've overlooked and a thousand different ways this proposal could be improved, but this isn't a comprehensive proposal. I'd leave that to the experts.
I know its a little late for Bernie to be changing his policies like this, but I wish that he had proposed something similar to this. It answers the question of "How do you pay for it?" completely. Employees and employers pay very similar rates as to what they were paying on the front-end before, except healthcare is now universal, simpler, and there are no costs on the back end. Now please tell me why I'm a moron for having written this out. If this is a shit idea, I'd genuinely like to know why so I can stop thinking about it.