Sen. Sanders' Bill Would Outlaw Traditional Employer Health Benefits; AHPI Releases Paper on Various Single-Payer Proposals
September 15, 2017
This week, Sen. Bernie Sanders (I-VT) introduced his highly-anticipated single-payer health care bill, which would create a national health insurance program (NHIP) and make it "unlawful" for employers to provide benefits that "duplicate" the program's benefits. However, the bill appears to allow employers to provide supplemental benefits that cover private contracts employees may enter into with providers, but these benefits may be subject to corporate and individual income taxes as well as payroll taxes. Other significant aspects of Sen. Sanders' proposal include:
- To control costs, the NHIP would pay providers at Medicare reimbursement rates and the program would annually negotiate prices for prescription drugs, medical supplies, and medically necessary equipment.
- Individuals in the NHIP would have no deductibles, coinsurance, copayments, or similar charges except for prescription drugs and biological products (limited to $200 per year) and long-term care.
- Sanders also released an options paper for financing the NHIP that included 7.5 percent income-based premium paid by employers, eliminating the tax exclusion for employer-provided health care benefits, imposing a one-time tax on offshore profits, a 4.5 percent income-based premium paid by households, and significantly increasing tax rates on upper-income individuals and families.
Although the bill has no chance of passage in the current Congress, 16 Senators cosponsored the bill and Democratic interest groups are demanding potential presidential candidates support the concept. Meanwhile, the American Health Policy Institute released its timely paper, "A Move to Single-Payer Health Care? Implications for Employer-Sponsored Care
," which analyzes how some previous single-payer proposals would affect employer-sponsored health insurance. Earlier attempts, at both the state and federal level, can give us a sense of what a single-payer system might look like in the United States. The paper specifically looks at how proposed plans in Vermont, Colorado, and California would have impacted the employer-based system if implemented.