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Warren vs. Sanders on Medicare-for-all: How do their plans compare?

Megan Henney

Senators Bernie Sanders and Elizabeth Warren, rivals for the Democratic presidential nomination, have unveiled sweeping, multi-trillion-dollar proposals to overhaul the country’s health-care system.

While the two lawmakers, who are jockeying for support among the party’s left-wing, are often viewed as the flipside of the coin — both are proponents of establishing a government-run health care system with no premiums, deductibles or copays — Sanders has tried to distance himself from the Massachusetts Democrats’ single-payer health-care system since she released it last Friday.

ELIZABETH WARREN'S MEDICARE-FOR-ALL PROPOSAL WOULD COST JEFF BEZOS $7 BILLION

On Sunday, during an interview with ABC News, Sanders took a stab at her recently released plan, which would cost the country "just under" $52 trillion, including $20.5 trillion in new federal spending, over the course of a decade. In her detailed outline, Warren called for new levies on the wealthy and a slew of other taxes to pay for the plan, including an “employer Medicare contribution,” which Sanders warned could harm workers’ wages and suppress job growth.

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"The function of health care is to provide health care to all people, not to make $100 billion in profits for the insurance companies and the drug companies. So, Elizabeth Warren and I agree on that," Sanders's, a Vermont independent, said. "We do disagree on how you fund it. I think the approach that [I] have, in fact, will be much more progressive in terms of protecting the financial well-being of middle-income families."

The particular tax that Sanders took issue with was the $8.8 trillion contribution from employers, who would pay the government a slightly smaller percentage than they currently pay to provide health care to their workers.

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“I think that that would probably have a very negative impact on creating those jobs, or providing wages, increased wages and benefits for those workers,” Sanders said. “So I think we have a better way, which is a 7.5 percent payroll tax, which is far more, I think, progressive because it’ll not impact employers of low wage workers but hit significantly employers of upper-income people.”

Here’s a closer look at how Warren and Sanders would pay for their sweeping proposals:

WARREN 

  • Taxes on additional take-home pay: Employees would no longer pay into their employer-sponsored health care, but would pay taxes on the extra take-home pay they receive under the new system.
  • Taxes on the wealthy: The ultra-wealthy would be hit with a 6 percent tax on income over $1 billion — up from the currently proposed 3 percent — and capital gains income would be taxed annually, rather than at the time of sale. Combined, those proposals would culminate in $2 trillion in funding. 
  • Taxes on financial firms: A 35 percent tax would be imposed on American companies' overseas profits, while foreign companies would also be taxed based on their domestic sales, resulting in an additional $1.65 trillion in revenue. 
  • IRS crackdown: By expanding IRS enforcement and cracking down on tax evasion and fraud, the U.S. could realize about $2.3 trillion in additional federal revenue.
  • Cut defense spending: Scaling back spending on the Pentagon would reallocate roughly $800 billion.
  • Immigration overhaul: By creating a pathway to legal citizenship for undocumented immigrants, the U.S. could raise an estimated $400 billion. 
  • Employer Medicare contribution: Because employees would no longer pay health premiums or co-pays another $1.4 trillion in funding would be generated through taxing that portion of their income, which is deducted for premiums before federal tax is calculated.

SANDERS

  • Payroll taxes on employers: Employers would pay a 7.5 percent payroll tax, replacing what they currently pay for health care. Right now, all employees and employers pay a 1.45 percent tax for Medicare, or 2.9 percent total. That would raise an estimated $3.9 trillion over 10 years. The first $2 million would be exempt from that tax in order to protect small businesses. 
  • Household premiums: Households earning more than $29,000 would pay a 4 percent income-based premium, generating $3.5 trillion over 10 years.
  • Taxes on corporations: It would impose a one-time tax on currently held offshore profits, generating $767 billion over 10 years. Large financial institutions would also be hit with a fee, producing $117 billion. 
  • Taxes on the wealthy: Under the proposal, the marginal income tax rate would increase incrementally for those earning more than $250,000 — a 40 percent tax — to those earning more than $10 million — a 52 percent tax. Likewise, it would also end the tax break for capital gains and dividends on household income above $250,000. The wealthiest 0.1 percent, or 160,000 households, would also be hit with a wealth tax. 

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