Embrace of single-payer ignores financial reality

DEMOCRATS have begun embracing singlepayer health care plans that would replace private insurance with government-funded coverage for all. They are taking this stance in the face of financial reality.

In Maryland, Democratic gubernatorial candidate Ben Jealous is campaigning on a platform that includes single-payer health care. His plan encountered a roadblock when that state’s Department of Legislative Services released its fiscal analysis, which concluded the plan would cost Maryland government $24 billion. Maryland’s state operating budget is $44 billion, so state government spending would have to increase by more than half again to cover the cost of governmentrun health care.

The DLS estimated that to pay for a single-payer system, Maryland lawmakers would need to levy a 10 percent payroll tax against every business and charge a $2,800 fee for every man, woman and child.

This estimate is not an outlier. Several years ago, Vermont became the first state to try to implement a single-payer system. By 2014, Gov. Peter Shumlin, a Democrat, threw in the towel. With considerable understatement, Shumlin said the 11.5 percent payroll tax assessments on businesses and sliding premiums of up to 9.5 percent of individuals’ income required to cover the cost of the plan “might hurt our economy.”

When Democratic lawmakers in California considered creating a single-payer health care system, a legislative analysis concluded it would cost $400 billion annually, which was more than double the state’s current budget. Purported savings generated by the plan would only partially offset the increased costs. The analysis estimated California lawmakers would need to pass something comparable to a payroll tax of 15 percent of earned income to cover the increased costs.

In 2017, the New York Assembly approved legislation to abolish private insurance plans and replace them with a government health insurance system. The Foundation for Research on Equal Opportunity, a conservative think tank, estimated New York’s single-payer plan would require increasing taxes by up to $226 billion more per year. (New York government spending totaled $82 billion at that time.)

In 2016, Colorado voters considered an initiative to create a single-payer system. Backers argued a 10 percent tax on payroll, capital gains, Social Security benefits, etc., would cover the costs, but the independent Colorado Health Institute estimated the program would be running “ever-increasing deficits” after only one year. Voters rejected the initiative 79 percent to 21 percent.

Sen. Bernie Sanders, an avowed socialist from Vermont, has filed legislation to make the federal government the sole insurer for all Americans. One-third of Democratic senators have signed on, including several eyeing presidential bids. But the left-leaning Urban Institute estimated one version of Sanders’ plan would cost $32 trillion by 2026, an amount equal to $24,000 in new taxes for every U.S. household.

Democrats see political gain in promising government will pay for your health care treatment. But when voters see the real cost of this “free” lunch, they continue to balk, even in the nation’s most liberal states.