Medicare for All would give Americans more disposable income

Most Americans do not have enough savings to carry them through retirement. In large part, that’s because the rising costs of employer health coverage has kept wages down, preventing people from saving for retirement. It’s also because Medicare only covers about half of people’s health care costs. Medicare for All would give Americans more disposable income.

As the debate over the future of health care in the US rages on, older Americans have a choice to make. They need to choose between the Medicare they have today, with its premiums, deductibles and coinsurance, as well as its lack of an out-of-pocket cap, and Medicare for All, which would reduce their out-of-pocket health care costs significantly. Working Americans also have a choice to make. They need to choose between employer health coverage with low wages and Medicare for All with more disposable income.

The latest data from Axios reveals that, after you adjust for inflation, Americans have not seen much of an increase in their wages over the last two decades. Many people don’t realize it, but their wages are a lot lower than they otherwise would be if their employers were not providing them with health insurance. Employers have been unable to keep the cost of health insurance down and have instead taken those costs out of their employees’ wages.

Put differently, 20 years ago, in 1999, households spent about 14 percent of their income on health insurance. Thirteen years later, in 2012, households spent more than double that, 31 percent of their income, on health insurance. Since then, premiums have stayed about the same, but deductibles and coinsurance have increased significantly.

Median inflation-adjusted household income in 2017 was $61,400, up just $1,400 from $60,000 in 1999. The cost of health insurance was $18,800 in 2017, more than double what it was in 1999 (up 121 percent).

Other data, just released by Peterson-Kaiser Health System Tracker, shows that households with large employer health plans have seen their health care spending rise twice as fast as workers’ wages in the last ten years. In 2018, putting aside the employer contribution towards health insurance (about two-thirds of the cost), the typical worker spent $7,726, $4,706 on premiums and $3,020 on deductibles and copays. That’s a 67 percent increase from 2008 and an 18 percent increase from 2013.

We need to control health insurance costs. That means overhauling our commercial health insurance system, which drives up costs. The simplest and most cost-effective way to do so is to have one public health insurance program that covers everyone.

Medicare for All would end employer-provided health insurance coverage and give everyone guaranteed affordable health care coverage. In turn, people would see their wages increase. They would pay for health insurance through their taxes. But, the amount they would pay in taxes would be lower than the amount they currently lose in wages.

With Medicare for All, working people would have more money to save for retirement and to spend on housing and education. Older adults would have lower health care costs. Everyone would have far better health care benefits–no premiums, coinsurance or deductibles. And, all Americans would be able to see the doctors they want to see anywhere in the United States.

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