A case made for Medicare for All?

Attack may really prove cost benefits

In this corner, Bernie Sanders, the former presidential candidate whose Medicare for All Act has become a rallying point for advocates of single-payer health care. In that corner, Charles Blahous, an economics analyst who spent much of his tenure as a Social Security and Medicare trustee (2010-2015) arguing that the programs needed to be reformed, in part by cutting benefits.

Earlier this month, Blahous published a paper through the conservative Mercatus Center at George Mason University that aimed to bury the Sanders plan for good. He wrote that the cost of Medicare for All would be “substantially greater” than Sanders and his acolytes estimate, and would result in a massive increase in federal spending.

Yet some people are reading Blahous’ paper as actually making the case for Medicare for All. Among them is Ernie Tedeschi, a former economist at the Treasury Department now doing fiscal analysis for Evercore ISI, who points out that according to Blahous’ analysis, Medicare for All will reduce national health expenditures by $2 trillion over 10 years.

They’re right. Sanders himself tweeted victory on Monday, noting that “even a Koch brothers-funded attempt to trash Medicare for All can’t hide the truth.” (Koch family foundations have been big contributors to the Mercatus Center, where Charles Koch is a board member.) But how could this be? The answer lies in which numbers you think are important. Blahous focuses on the government share of total national health expenditures, which would more than double to about 95 percent from the current 45 percent. That would mean an increase in the federal budget of $32.6 trillion over the 10 years 2022-2031.

But as is often the case with analyses of singlepayer costs, what Blahous leaves out is the other side of the ledger. This wouldn’t be an increase in health care spending, but a shift of funding from private pockets to the public purse. In fact, according to Blahous’ analysis, under Medicare for All, overall U.S. spending on health care would be lower than currently projected in every year over the decade.

Taken all together, national health expenditures would total $57.6 trillion through 2031. They’re currently projected to be $59.7 trillion. In other words, Medicare for All would reduce total U.S. spending on health care by 3.44 percent. We asked Blahous to comment on the implications of his finding, but he didn’t reply.

In his paper, Blahous tries to conceal the implications of this figure by interpreting it as overall health expenditures remaining “virtually unchanged.”