Elizabeth Warren’s $52 trillion health care plan. We look at the big picture and unpack the details.

Guests

Jonathan Cohn, senior national correspondent at the Huffington Post who writes about health care, politics and policy with a focus on social welfare. (@CitizenCohn)

Simon Johnson, he co-wrote two "expert letters" for Sen. Elizabeth Warren's campaign analyzing the costs and revenue projections for the "Medicare for All" plan. Former chief economist at the International Monetary Fund. Professor of entrepreneurship and economics at the MIT Sloan School of Management. Co-author of "Jump-Starting America: How Breakthrough Science Can Revive Economic Growth and the American Dream." (@baselinescene)

Mark Pauly, professor of health care management, business economics and public policy at the University of Pennsylvania's Wharton School of Business (@Wharton). Former commissioner on the Physician Payment Review Commission, and has been a consultant to the Congressional Budget Office, the Office of the Secretary of the U.S. Department of Health and Human Services and the American Enterprise Institute.

Interview Highlights

On the claim that Warren’s plan would not raise taxes on the middle class

Jonathan Cohn: “It's one of those questions, that statement, that really depends on how you interpret it. You know, on paper, she's right. I mean, she has constructed a plan that does not impose a new tax that falls directly on the middle class. And she has — insofar as she's sort of looking for new taxes to help finance that — she has really put them exclusively on the wealthy, and on corporations. You know, that's a big part of her financing. You know, the asterisk there — there's actually several asterisks there – but, I would say one of the most important is that she does ask employers to contribute towards the cost of insurance. … The way she's structured it, she's basically said to employers, ‘I want you to keep paying what you're paying now.’ So, there's not really a new tax. On the other hand, if you talk to most economists, they would say that, ‘Well, you know, when employers pay for insurance, even if it's out of their own pockets, eventually that's coming out of wages, and you kind of roll down the line.’ And in the grand scheme of things, some people would say, ‘Well, that's actually still a tax on health care. It just is on the employers, which eventually passes to the employees.’ You know, I would say that you could say it's a true statement. But, you know, it's true with a lot of caveats that you need to understand.”

How does the plan reduce overall spending?

Jonathan Cohn: “This is a really important part of the discussion, when we talk about what the plan is going to cost. What is it going to cost to give everybody health insurance through this new ‘Medicare for All’ system? And we have sort of forces that are going to kind of push in two directions, right? So, on the one hand, when you go to a single-payer system, the government’s more efficient than having all these private insurers, hospitals don't have to spend all that money on billing, so that saves money. In addition, when the government is running the whole insurance program, it can set an overall budget and it can sort of dictate to hospitals and doctors what they're going to get paid. It can negotiate directly with drug makers, and that can save money. On the other hand, you're giving a lot of people insurance who don't have it already. And, remember, the insurance for people who already have coverage — say, through an employer — your insurance is about to get better. Your deductibles are going to go away; your out-of-pocket costs are going to go away. And that's really one of the main goals of ‘Medicare for All.’

"But, of course, when you give people better insurance, or you give people insurance they didn't have, they consume a lot more health care. And so that's going to drive costs up. So, when we sit and decide, ‘Well, how much is ‘Medicare for All’ going to cost?’ you have to take into account both: What's pushing the cost up? All these new people getting health care. What's pushing the cost down? Savings, the administration savings, dictating costs to hospitals and doctors. And the cost comes out to how you assume that's all going to net out. She has kind of come up with numbers that she says, ‘Look, I kind of put that all together, and we stay right at the same level we are today.’ Some people would say, ‘Is that right? Is that wrong?’ That's the debate we're having.”

What would an average person pay under a Warren plan?

Simon Johnson: “Nothing. … So, right now, in the forecast, the best forecast that we have — which are not our forecasts, they’re official government forecasts. American families – so, households — will pay, over the next 10 years, a combined $11 trillion in insurance premiums, co-pays, deductibles and other out-of-pocket expenses. That's an enormous amount of money. Under the Warren plan, that goes to zero. Absolutely to zero. You don't pay anything. So, where does the extra funding come from, to cover that $11 trillion? That's what comes from the taxes on the wealthiest individuals, the largest corporations. They go after tax avoidance — global tax avoidance — which is a huge number. And all they do is move our tax rates on those large companies — in terms of collecting from these people — to the OECD [Organization for Economic Co-operation and Development] average, because we're so bad at this right now. Rich people are not like you and me … they don't pay tax."