Kamala Harris Unveils Her Twist on Medicare for All

Plus, the 2020 budget fight isn't over yet

Kamala Harris Puts Her Own Twist on Medicare for All

Sen. Kamala Harris of California released a plan Monday to provide universal health care in the U.S. by expanding Medicare while maintaining a major role for private health insurers.

Issued ahead of the next round of debates for Democratic presidential candidates, the proposal falls somewhere between Sen. Bernie Sanders’ proposal to eliminate all private insurance and former Vice President Joe Biden’s plan to add a public option to the existing Affordable Care Act exchanges. “Slower than Bernie Sanders, but more ambitious than Joe Biden,” said Politico’s Dan Diamond and Christopher Cadelago.

Here’s what the plan, already dubbed “KamalaCare,” would do:

  • Enable all Americans to buy into Medicare immediately, with newborns and the uninsured being enrolled automatically.
  • Cover most medical services, including vision, dental, emergency room visits, mental health and reproductive health.
  • Allow private insurers to offer competing plans, which would function something like Medicare Advantage, providing private alternatives that meet basic conditions defined by the government.
  • Apply the pricing and quality rules established by the Medicare system to all health care plans, after a 10-year transition period.
  • Allow people to purchase supplemental insurance to cover options like cosmetic surgery.
  • Allow businesses to continue offering private health insurance to their employees.
  • Raise revenues by taxing stock trades and offshore corporate earnings and by imposing a 4% tax on households earning over $100,000 (with a higher threshold in high-cost areas) — a package that is intended to raise “well over” $2 trillion over 10 years.

Harris’s proposal differs from Sanders’ Medicare for All plan (of which Harris is a co-sponsor) in several important ways, said Vox’s Li Zhou:

  • It allows private insurers to continue to play a major role in the system, as long as they meet requirements on costs and benefits.
  • It extends the transition period for reaching universal coverage to 10 years, compared to four years under Sanders’ plan.
  • It exempts households earning less than $100,000 from paying additional taxes to pay for the plan; Sanders calls for a 4% tax on all households earning more than $29,000 to help fund his ambitious proposal.

Sarah Kliff of The New York Times said the Harris plan has parallels in other wealthy, industrialized nations. “The idea that Harris is proposing is, in health wonk parlance, a multi-payer universal coverage system,” Kliff wrote. “It's the type of system you see in the Netherlands, Germany, Japan, to name a few examples.”

Andy Slavitt, who ran the Centers for Medicare and Medicaid Services in the Obama administration, said the Harris plan “balances idealism and pragmatism. It says in effect: We have a mandate to get everyone affordable health care and put people over profits — but we don’t need to tear down the things people have and they like in order to do it.”

The proposal leaves many questions unanswered, however, including its cost at both the individual and aggregate level. And as Zhou points out, it faces enormous hurdles, including likely resistance from the health care industry and near-certain opposition from Republican lawmakers.

Kristine Grow, a spokesperson for America’s Health Insurance Plans, an industry trade group, said the Harris proposal “puts us on a slippery slope to Medicare for all” and warned that Americans “will have to pay more, to wait longer, for worse care.”

Read Harris’s proposal here.

Quote of the Day

“When you have 90 percent of the American people covered and they are drowning in their health care bills, what they want to hear from politicians are plans that will address their health care costs, more than plans that will cover the remaining 10 percent. … When Democrats talk about universal coverage more than health care costs, they are playing to the dreams of activists and progressives ... much less to the actual concerns of the 90 percent who have coverage today.”

– Drew Altman, president of the Kaiser Family Foundation, a nonpartisan research organization that tracks the health care system, in an Associated Press story noting that “America’s much-maligned health care system is covering 9 out of 10 people.”

Trump Administration Won’t Fund Partial Medicaid Expansion

The Trump administration has rejected a request from Utah to provide funds for a partial expansion of Medicaid in the state. Like some other Republican-controlled states, Utah wanted to expand its Medicaid program as allowed under the Affordable Care Act, but it wanted to do so on a more limited basis than the health care bill established.

The Obama administration also refused to allow partial Medicaid expansions, on the grounds that states had to allow more people to participate. The Trump administration, by contrast, rejected the expansion because it now says the ACA is illegal. "White House advisers argued that it did not make sense to approve generous federal funding under the ACA while the administration is arguing that the entire law should be overturned," the Washington Post’s Yasmeen Abutaleb said.

The 2020 Budget Fight Isn’t Over Yet

The Senate this week is expected to approve the $2.7 trillion deal on spending caps and the debt ceiling passed last Thursday by the House, and President Trump will sign it, his acting chief of staff said this weekend. That doesn’t necessarily mean this year’s budget battles are over, though.

Roll Call’s Jennifer Shutt and Niels Lesniewski report:

“The two chambers need to reach agreement on the 12 annual spending bills to flesh out the budget accord and avoid a repeat of the 35-day partial government shutdown of last December and January.

“The fiscal 2020 spending bills contain dozens of sticky issues, some of which have been solved before and some of which negotiators will have to wade through for the first time — all amid a background of increasing partisanship ahead of the 2020 elections.”

The House has already passed 10 of the 12 appropriations bills for fiscal year 2020, but will need to rework some to match the details of the budget agreement. “They’ll also likely have to strike through many of the left-leaning policy riders that made the bills so appealing to liberal Democrats,” Shutt and Lesniewski say. The Senate, meanwhile, waited until a deal on spending caps was struck, meaning that it will rush to put together its spending bills before the fiscal year ends on September 30.

The Homeland Security bill is expected to once again be the most contentious. “I’m sure there’s going to be a fight over the border wall,” Sen. Lindsey Graham (R-SC) said, according to Politico.

Just how heated that fight will get remains to be seen. Republican leaders reportedly hope that the budget deal will give Trump enough reason to shy away from another shutdown, including the ability to redirect certain funding from the Defense Department to his desired border wall. Friday’s Supreme Court ruling clearing the way for the administration to spend $2.5 billion on wall construction likely helps in that regard. But between the border wall, Immigration and Customs Enforcement funding and detention beds, the Homeland Security bill could be sidetracked by numerous points of contention.

One possible solution reportedly might be a stopgap spending bill that continues current DHS funding, with one unnamed senator telling Politico that such a stopgap could extend all the way to November 2020. But lawmakers aren’t sure how that idea will go over with Trump, and even those in his own party are reluctant to predict what the president will do,
Politico’s Burgess Everett and Melanie Zanona reported:

“They don’t know how hard Trump will push for a border wall, not to mention other hot-button immigration provisions. If he won’t compromise with the Democrats who control the House, a shutdown fight could ensue — exactly what GOP leaders are eager to avoid heading into an election year.”

For a more complete look at the coming appropriations process, see Roll Call.

How Much Would Warren’s Ultra-Millionaire Tax Really Raise?

Elizabeth Warren says her proposed wealth tax — 2% on Americans with assets above $50 million, or 3% for those with more than $1 billion — would raise $2.75 trillion over 10 years, based on estimates from noted Berkeley economists Emmanuel Saez and Gabriel Zucman. Others have questioned that figure, though, and a new paper — still a work in progress — from economists at the Treasury Department, Princeton and the University of Chicago suggests that Warren’s proposal could generate far less than she expects (h/t Morning Tax).

The authors note that it isn’t easy to get a handle on just how much wealth is concentrated at the top, but their rough estimates indicate that Warren’s “ultra-millionaire” tax threshold would have to be lowered from $50 million to $11 million to maximize revenue — and that doesn’t factor in any potential behavioral changes, like wealthy people coming up with ways to avoid the tax. Even then, that lower threshold would produce $146 billion a year, or just over half the amount Warren projects.

Treasury Plans Big Jump in Debt Sales

The U.S. Treasury announced Monday that it plans to borrow more — a lot more — than previously projected in the third quarter. Total borrowing is expected to hit $433 billion in the July-to-September period, about $274 billion more than officials estimated in April, Bloomberg’s Alex Harris reported. Some of the additional funds will go toward increasing Treasury’s cash balance.

The borrowing estimate is based on the assumption that that debt limit will be suspended, Treasury said. The two-year budget deal that the Senate is expected to pass and send to President Trump this week includes an agreement to suspend the debt ceiling until July 31, 2021.

Sales of U.S. Treasury notes and bonds are expected to rise in the coming quarters on the heels of the $324 billion increase in government spending laid out in the budget deal, Bloomberg’s Liz McCormick and Saleha Mohsin reported Monday. “The deficit is rising and the impetus toward higher spending is very strong,” said Stephen Stanley, chief economist at Amherst Pierpont Securities.

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