So, that $9 trillion in “Employer Medicare Contribution” (EMC) replaces private heath insurance costs. Okay.
But how is that $9 trillion EMC levied? She won’t say.
By employee? Then employers would want to replace FTE’s with contractors. Do contractors/gig workers get a free ride? Vox notes that she exempts employers with less than 50 employees. How do they pay the EMC? Do they even pay it?
Would the $9 trillion be levied in the form of higher corporate income taxes?
It is kind of an important detail. I went to Warren’s web site and the info is just as lacking. In fact what is given is completely worthless.
She pays for the rest of the eye-popping $52 trillion with a grab bag of taxes that will never be realized like immigration reform tax collected and defense spending cuts and the go-to ridiculous financial transactions tax. And of course “cost savings” that cannot be confirmed.
This “plan” is awful and is just a way for her to falsely claim that middle class taxes won’t go up.
She deserves to lose for this absurd “plan” which is nothing more than misdirection and political hucksterism.
It seems like levying it equally on all employers would be far preferable. That way, employers who’ve already calculated health care into their compensation packages would see no effects, whereas employers who’ve not done so would face a de facto penalty, and would have to catch up with their more worker-friendly competitors.
In fact, if it were levied on everyone, not just folks already offering health insurance, those already offering it could pay a little less.
I don’t have much patience with small businesses who say they can’t afford to provide health care. If you can’t afford to treat your employees right, you can’t afford to run a business.
You obviously have no experience buying corporate plans as a small employer. For companies with less than 10 employees it is almost twice as expensive to buy a corporate plan then it js for each person to buy their own plan. I tried to get insurance for myself and my two employees and it was better for us all for me to just give them a raise to go buy their own insurance because our pool wasn’t large enough. Of course neither of them chose to use the raise to buy the top insurance plan since one was covered by his wife and the other chose to get the cheapest bronze plan. If every employer was taxed I’d have to give them both large pay cuts.
The reason for this is that a very small business can just buy a corporate plan when/if one of the covered family members of the owner actually is sick. I knew someone who did this very thing. (and he, uh, was a proud Republican and Trump voter, even though his kid needed 250k in treatment)
AIUI, it means that employers have as much incentive to have a “high-cost-per-employee” ratio as they can, because the higher the ratio, the more beneficial it is to them. So they will trim their workforce down to achieve a high cost-per-employee ratio.
Let’s say today’s average health plan is $18,000 per employee. The employer might withhold (for tax reasons) $12,000 of that and require the employee to pay $6000.
When the new EMC is calculated the employer would owe Uncle Sam all $18,000 times 98%. A big tax hike per employee.
As a cost accountant I would advise my employer to fire me and contract me back at 80% of my pay package. I would gladly accept that and let other working stiffs pay for my MFA.
Edit (Remember my pay package includes FICA, SS withholding, PTO, etc. 80% of my pay package would be over a $10,000 income increase for me)
I don’t have that experience, you’re right. The folks I know who don’t get employer health care coverage are also working very low-income jobs, below-living-wage jobs.
In the circumstance you’re talking about, sure: give them a pay cut to pay for the taxes. Then they get to stop paying for insurance. Under this plan, their pay cut plus their cut in expenses will be a net gain for the vast majority of workers.
Can I just say that the fetishization of Democrats’ fiscal responsibility is driving me absolutely nuts on the whole M4A discussion. Literally nobody pesters the GOP when they refuse to articulate how their tax cuts and limitless military spending will be financed, but the Democrats are now just hammering each other over ‘OMG but how will you PAY FOR IT?!’
Just have them all say that M4A will pay for itself like GOP tax cuts always do, and move on.
Exactly right. Hell, say you will pay for it with a tax cut.
Or if you want to a bit more detailed just say “we will recapture some fraction of what employers are currently spending on health insurance for their employees” without trying to spell out the nitty gritty details. As pointed out there are plenty of ways to do it.
The obsession by the candidates (all of them) with writing this kind of massive legislation in advance is just bizarre, let alone their desire to “pay for” all of their fictitious details in advance.
Like, the actual best-case health care bill is going to be bribing Chris Coons to vote for a tax-advantaged health savings account system that nobody knows how to use because you need a crystal ball and a six-page IRS form to use it, and even that is going to be derided as a communist takeover of healthcare and lead to a 70-vote swing to the Republicans in 2022, so why do this whole dance where everyone (again, not just the M4A folks) fights over whose imaginary pony gallops the fastest.
Oh well, I’m sure this will be a fun hour of the next debate! snooze