Medicare for All will pay for itself?

The following is not about Medicare for All, but simply extending the current Medicare coverage down to age 60. Note the increased federal deficit. And especially note the transfer of costs to the federal government outlined in red.

When you hear that M4A will pay for itself based on lower spending and efficiencies for the Country as a whole, the flaw in that argument is that the savings are not generated for government.

CBO and JCT estimate that lowering the age of Medicare eligibility to 60 would increase federal budget deficits by $155 billion over the 2026–2031 period through the effects of that policy on federal revenues and mandatory spending.

Enacting the policy would have a significant effect on primary sources of health insurance coverage, and it would increase the number of people insured. According to CBO’s estimate, in 2031:

Mandatory, or direct, spending includes outlays for some federal benefit programs and for certain other payments to people, businesses, nonprofit institutions, and state and local governments. Such outlays are generally governed by statutory criteria and are not normally constrained by the annual appropriation process.

• About 2.0 million fewer people would be enrolled in nongroup coverage, and almost all of them would enroll in Medicare instead.

• About 0.4 million fewer people would be without health insurance.
Those changes in health insurance coverage under the policy would cause federal deficits to increase for three main reasons:

• Although spending on health care would decrease, on average, for people with employment-based coverage under current law (largely because Medicare generally has lower payment rates for medical services), federal costs would increase because a larger share of that spending would be paid by the federal government rather than employers.

• Some people who are projected to be uninsured or enrolled in unsubsidized nongroup coverage under current law would instead have health insurance coverage subsidized by the federal government.

• Federal costs for people with Medicaid coverage under current law would increase, primarily because of greater spending on health care for people dually eligible for Medicaid and Medicare and because a greater share of those costs would be paid for by the federal government rather than state governments. Those costs would be partially offset by reductions in Medicaid spending for people who would lose their eligibility for Medicaid under the policy.


  1. Yes, and …

    One of my favorite observations regarding M4A is that we do not have M4A today for those enrolled in Medicare today!

    Remember, M4A ≠ Today’s Medicare!!!

    Let me repeat that. Medicare for All is a Bernie fantasy that includes:
    • No change in current infrastructure of doctors, hospitals and other health care providers.
    • Nationalize the health insurance industry – diverting all current spending into the system, including state spending on Medicaid and other programs.
    • Anyone who is a US resident, including undocumented immigrants, gets coverage – there would be a prohibition for travel to the US for free medical care.
    • Anyone can select health services from any provider.
    • General non-discrimination rules apply, except to the unborn – abortion for anyone at any time.
    • Government to enforce all rules via litigation.
    • All enrolled at birth or upon coming to America.
    • Four year transition period, phase in starting with children.
    • Private coverage is illegal – except for stuff like cosmetic surgery that is not covered by M4A. Not clear whether you could self-fund.
    • Includes almost all health, vision, dental services, and some long term care services as well.
    • States can offer their residents supplementary benefits.
    • No cost-sharing, including deductibles, coinsurance, copayments, or similar charges – potential exceptions for prescription drugs and biological products – up to $200/year for those earning 200+% of federal poverty level.
    • Includes home- and community-based long-term care.
    • While M4A says you can see any provider, there is no provision in the bill to make slaves out of providers. Much like many who do not participate in Medicare today, many will change to a fee-for-service basis outside M4A.
    • Not clear how physicians and other providers will be paid. Looks like continuation of Medicare pricing today under traditional Medicare – DRG’s, RBRVS, with no Balance Billing.
    • Expanded bureaucracy to administer the program.
    • Money for health insurance / claims paying entities to transition to other employment.
    • Increased federal government role in physician and medical specialist education.

    This week, Fidelity updated its estimate of the AVERAGE cost for a couple, age 65, retiring today, in terms of the present value of their projected spend for Medicare premiums and out-of-pocket costs. To be 95+% confident that you have saved enough to fully fund those costs, you might have to double those AVERAGE estimates. Then, guys, double it again to be 95+% confident level that you have fully funded the cost of long term care services. In case you are as bad at math as me, that’s $315,000, to $630,000, to $1,260,000 for a couple! And, that’s only the retired couple’s spend … not including the larger portion which is paid by wage earners and taxpayers!

    Fidelity annual estimate in 2022:
    Fidelity lifetime funding estimate:

    If you are planning for retirement, plan on $5,850 per year per person spend – premiums and out of pocket expenses.
    Averages are deceiving. Most will spend less than that amount – the average will be dragged higher by those with super spend amounts.

    But, when it comes to M4A, ignore the layers of additional funding needed to be “fully funded” – just focus on $315,000 for an age 65 couple.

    Next time Bernie proposes M4A, ask him who gonna pay the $315,000 for CURRENT couples covered by Medicare TODAY! Then, remember that wage earners already pay most of the cost of Medicare Part A, and that taxpayers (general revenue) already pay ~75% of the cost of Medicare Part B and Part D. Given that the Medicare Hospital Insurance Trust Fund will be exhausted in 2026, and that there is no Medicare Trust Fund for Part B and Part D, all of Medicare will be pay as you go in 2026.

    Myself, I think this is a Bernie (and co-sponsor’s) sleight of hand solution to cover up their past mistakes, to avoid having to substantially raise taxes on wage earners and others. Congress has never been willing to charge the necessary amount and rate of taxation that was necessary to appropriately fund Medicare (to make it indefinitely sustainable).

    M4A is beyond fantasy.

    Liked by 1 person

    1. “Next time Bernie proposes M4A, ask him who gonna pay the $315,000 for CURRENT couples covered by Medicare TODAY! ” Please don’t ask him that question unless you are asking for the government to cover more of your expenses. Isn’t the what is being proposed now already enough of a problem that we don’t need to make it even worse! The correct answer is the CURRENT couple needs to pay. The correct question should be how does the current couple plan to pay. “Ask not what your country can do for you – ask what you can do for your country,” Learn to pay your way and not depend on others.


      1. As I have frequently said, Americans want the best coverage YOUR money will buy.

        The difference here is that current retirees think they fully funded the portion of Medicare with the taxes they paid as wage earners and taxpayers – both the Part A and the taxpayer contribution for Part B and Part D which are mostly funded by general revenue taxation (income taxes). Many are all too willing to believe the Bernie crap that we can have coverage for free with no deductibles, copayments, premiums, etc. in part because they think they already paid enough.

        And, some of us have! Some of us have paid wage taxes (FICA-Med) and general income taxes over the past 50+ years, including the foregone wages from our employers to fund half of the wage taxes, that we have more than fully funded any benefit we will ultimately receive from Medicare.

        On the other hand, you can qualify for lifetime, non-contributory Medicare Hospital coverage today after paying less than $1,000 in FICA-Med taxes over the past ten years. And, if your income is that low, you may also qualify as dual eligible with Medicaid – where you won’t have to pay the Part B and Part D premiums, nor any point of purchase cost sharing for your Medicare coverage.

        The only thing more regressive (heavily weighted as income is lowered) than the taxes, FICA and FICA-Med, are the benefits they fund.


    2. Thank you for your research. My only question to the M4A people if the government is going to cover almost all your medical, dental, vision, long term care, and drug expenses, why would the states need to offer their residents supplementary benefits? So what isn’t covered?


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