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US election 2020: Elizabeth Warren sets out health funding plan

US presidential hopeful Elizabeth Warren has offered details on funding for her healthcare plan, which is expected to cost the federal government $20.5tn (£15.8tn) over 10 years.

She said the "Medicare for All" plan would not raise taxes "one penny" for ordinary Americans, but be largely paid for by businesses and the wealthy.

Ms Warren is a Democratic frontrunner in the 2020 race to the White House.

She has faced criticism over lack of detail about her plan.

So, what does her plan say?

Ms Warren says her plan would not spend "any more money overall than we spend now", but the share spent by the federal government would increase to $20.5tn.

It would mandate that employers pay the government the same amount that they currently contribute for private health insurance for their employee.

According to her campaign, the current US health system will cost $52tn over the next decade. Economists have estimated Medicare for All's cost at between $13.5tn to $34tn in the same time frame.

"The $11tn in household insurance and out-of-pocket expenses projected under our current system goes right back into the pockets of America's working people," her plan states.

"And we make up the difference with targeted spending cuts, new taxes on giant corporations and the richest 1% of Americans and by cracking down on tax evasion and fraud. Not one penny in middle-class tax increases."

Ms Warren says she would:

  • raise her previously proposed wealth tax on billionaires from 3% to 6%
  • increase corporate taxes
  • tax transactions such as stock trades
  • raise revenue through immigration reform – by turning undocumented migrants into legal, taxpaying workers.

"Health care in America is world-class," the Massachusetts senator wrote in her proposal. "Medicare for All isn't about changing any of that. It's about fixing what is broken – how we pay for that care."

What is Medicare-for-All?

First proposed by Ms Warren's fellow liberal senator, Bernie Sanders, it is a measure to expand the federally run health programme for the elderly and disabled, Medicare, into a single-payer health system.

The federal government would become the sole insurance provider for all essential and preventative healthcare.

It is not a universal health care system where the government would own and operate hospitals – instead, the government would pay private providers an agreed-upon rate for their services.

Unlike Ms Warren, Mr Sanders has acknowledged the need for taxes on the middle class without offering specifics.

Being realistic isn't the goal

Elizabeth Warren needed to come up with a healthcare plan that provided the universal coverage she promised while not raising taxes for most people. She did – although her proposal relies heavily on contributions from businesses that already pay for part of employee healthcare, as well as the very wealthy and a grab-bag of other relatively vague pots of cost savings.

$2.3tn in new revenue from more aggressive tax enforcement? $400bn from immigration reform? A 70% reduction in the cost of brand-name drugs? It's easy to put numbers on a piece of paper. It's harder to imagine these figures becoming a reality.

Being "realistic" isn't necessarily the goal of Ms Warren's proposal or even the central point of her plan-heavy campaign, however. The Massachusetts senator and her supporters would argue that pragmatism and a misplaced sense of what's possible are the enemies of substantive progress.

Critics may pick apart portions of her sweeping healthcare proposal, but it is substantive enough to protect Ms Warren from allegations that she is making promises without considering the price tag. Such questions proved to be a point of weakness for the candidate in recent debates. In the clashes to come she will be better prepared to respond.