Of all the candidates running to become the Democratic nominee, two have said they support Medicare for All if it eliminates private insurance. One is Bernie Sanders, the other is Elizabeth Warren, and until Friday morning, only the former had explained how he’d pay for it. Medicare for All — how it’s defined, how it’ll be financed, why it is preferable to more moderate health-care reform — not only fascinates debate moderators; it’s become a litmus test, separating the primary field’s moderates from its more left-wing entrants.
Sanders is still the candidate associated most publicly with Medicare for All. He “wrote the damn bill,” as he once reminded a debate moderator. (His campaign now sells the phrase on stickers.) And Warren wouldn’t have been the first co-sponsor to back away from the Sanders bill on the campaign trail, as Senator Kamala Harris says she no longer supports it. As mayor of South Bend, Indiana, Pete Buttigieg wasn’t in a position to co-sponsor any legislation, but he, too, has reversed his support for Medicare for All. With Friday’s plan, however, Warren has now made it clear she’s committed to the policy. Though she’d finance it differently than Sanders, the result is still universal coverage.
As outlined in a post on her website, Warren would levy a new tax on billionaires, in addition to her existing wealth tax, to help finance Medicare for All. Employers would no longer have to subsidize health insurance for staff; instead, they’d pay a new tax, which Warren calls “Employer Medicare Contribution.” Employers would have to calculate the amount they spent on health care “over the last few years and divide that by the number of employees of the company in those years to arrive at an average healthcare cost per employee at the company,” Warren writes; employers would then pay out 98 percent of that figure to the federal government. Warren estimates that contribution would raise around $8.8 trillion over the next decade. She’d also add a new tax on the sale of stocks, bonds, and derivatives, writing, that even a small tax of “one-tenth of one percent” would raise “$800 billion in revenue over the next ten years.”
Warren also says she’d increase the budget for the Internal Revenue Service and “redirect” its enforcement investigations “away from low-income taxpayers towards high-income taxpayers.” That would be a significant strategic shift for the IRS. ProPublica had previously reported that the IRS is much more likely to audit low-income taxpayers, though fraud committed by high-income taxpayers represents a more significant drain on the economy. In October, the agency’s commissioner, Charles Rettig, told federal lawmakers that he just didn’t have the budget to go after the rich. Warren says that her plan, which includes a proposal to grant whistle-blower status to employees who report fraud and tax evasion, would raise another $2.3 trillion in revenue. An analysis of the plan, compiled by Simon Johnson, the former chief economist of the IMF; Betsy Stevenson, a former chief economist for the Department of Labor; and Mark Zandi, the chief economist of Moody’s Analytics, says that Warren’s IRS proposals would “would close the overall tax gap by one-third” and “generate an additional $2.3 trillion in revenue after accounting for the increased cost of IRS and other agency enforcement.”
The more creative pay-fors in Warren’s plan include immigration reform and the elimination of the Pentagon’s Overseas Contingency Operations Fund. Warren writes that she’s based her proposal on a previous Congressional Budget Office estimate of 2013’s immigration reform bill. Increased immigration means more tax revenue, and that revenue, Warren argues, would help finance Medicare for All. She also refers to the Pentagon’s OCO budget as a “slush fund,” an assessment shared by other lawmakers and experts. By eliminating it, Warren hopes to raise $798 billion over the next decade.
This isn’t a comprehensive breakdown of Warren’s plan. But these major details do clarify Warren’s position on Medicare for All. They indicate something else, too. Though other candidates are pivoting right to distinguish themselves in a crowded field, Warren isn’t one of them. Even so, her plan might not mollify Sanders supporters who back the Vermont senator specifically because of his record on Medicare for All. Warren’s plan excludes a payroll tax in favor of the Employer Medicare Contribution, which is potentially less progressive. The Sanders bill specified a four-year transition period and Warren’s proposal doesn’t specify a time frame, but Representative Pramila Jayapal later tweeted on Friday afternoon that Warren’s proposal is identical to the Sanders bill in this regard:
Warren’s proposal adds that she will release a more detailed transition plan “in the weeks ahead.” Her plan certainly won’t satisfy conservatives, or even the primary field’s moderates, like Buttigieg and Biden. But nothing really could: Both factions oppose the policy on principle, an intransigence that will continue to make itself apparent in debates and stump speeches to come.
This post has been updated with new information.
