‘Medicare for All’ expansion plan could cost Arizona up to $45 billion per year

In a new analysis of the “Medicare for All” proposal to expand the federal Medicare program to everyone regardless of health care coverage status, the Arizona Chamber Foundation reported that the proposal could cost the state an additional $45 billion annually.

“Medicare for All” is a national policy initiative sponsored by Senator Bernie Sanders (D-VT) that advocates for universal access to health care for Americans, regardless of income. Sanders proposes separating health insurance coverage from employment to promote “innovation and entrepreneurship” in all economic sectors.

The national price tag has been pegged at $32.6 trillion over ten years, according to Senior Research Strategist Charles Blahous of the Mercatus Center at George Mason University.

The analysis by the Arizona Chamber Foundation, prepared by Rounds Consulting Group, found that the cost of such a plan could place an excessive burden on Arizona  taxpayers, generating a need for a completely new tax plan.

“If a ‘Medicare for All’ option were expanded to only the state’s uninsured population, new state costs would equal an estimated $4.3 billion per year,” the report said.

According to the report, that amount is a “conservative starting point” that would increase each following year. To pay for the program under the state’s current tax plan, Arizona would need to double the state sales tax rate or double the state income tax for all taxpayers.

“The negative economic consequences of such a large required tax increase would result in significant job losses and a reduction in spending on other economic fundamentals including education, infrastructure and public safety,” according to the report.

About 667,000 Arizonans are without medical insurance, according to the U.S. Census Bureau. According to the Henry J. Kaiser Family Foundation (KFF), the cost per capita for health care in Arizona was about $6,452 in 2014.

“By multiplying the number of uninsured by the health care spending per capita in Arizona, it can be estimated that the cost to provide health care to those currently uninsured would be at least $4.3 billion,” the report said. “This figure is very conservative and would rise each year with health care inflation and population growth.”

The report notes that providing Medicare coverage for all 7,016,000 Arizonans, not only the uninsured, could cost in excess of $45 billion. For context, the state’s General Fund budget is approximately $10.5 billion and funds multiple state programs including K-12 education, public universities and child safety programs.

“There does not exist an economic scenario where the implementation of this plan is fiscally feasible,” the report concluded.

Graham Bosch

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