Earlier this year, billionaire investor Warren Buffett observed that “medical costs are the tapeworm of American economic competitiveness.” Volk Packaging Corporation President Derek Volk, in his Nov. 17 letter to the editor, echoes this concern: “One of the biggest challenges to my box company is the rising cost of health care.” He suggests that one way to lessen this challenge would be to repeal the health insurance tax, which adds, he says, $500 annually to the cost of insuring one employee.
I think Mr. Volk can do better than that. How about if we repeal and replace the whole employer-based health insurance system?
One of the options Sen. Bernie Sanders proposes for funding his Medicare for All Act of 2017 is a payroll tax, which, he explains, would replace employers’ premiums: “In 2016, employers paid an average of $12,865 in private health insurance premiums for a worker with a family of four who makes $50,000 a year. Under this option, employers would pay a 7.5 percent payroll tax to help finance Medicare for All – just $3,750 – a savings of more than $9,000 a year for that employee.” Sounds better than $500.
In the House Expanded and Improved Medicare for All Act (HR 676), the payroll tax would be 4.75 percent, though economist Gerald Friedman, in his analysis of the bill, thinks up to a 7 percent tax might be necessary.
Of course, these figures are approximate and may not apply to Mr. Volk’s company. And other taxes would be required to fund a Medicare for All system. But I think the possibility of paying less for employees’ health care, avoiding its hassle and knowing that all employees, whether full- or part-time, would be covered would make him want to take a hard look at this alternative to our present arrangement.
Daniel Bryant, M.D.
Note: Dr. Bryant, retired physician, is the chair of the Greater Portland Chapter of Maine AllCare