Fact Check: Elizabeth Warren’s Medicare for All Plan Raises Taxes on the Middle Class

Sen. Elizabeth Warren (D-MA) unveiled her plan to fund Medicare for All, claiming that the plan would not raise taxes on the middle class. However, tax experts have noted that the plan will, in fact, hike taxes on the American middle class.

Warren faced criticism during the last Democrat presidential debate when she dodged questions over how she would pay for her single-payer Medicare for All plan. The Massachusetts Democrat unveiled her plan Thursday, in which she claimed that her plan would not foot the bill onto the middle class.

“Today, I’m releasing my plan to pay for #MedicareForAll. Here’s the headline: My plan won’t raise taxes one penny on middle-class families,” Warren said. “In fact, we’ll return about $11 TRILLION to the American people. That’s bigger than the biggest tax cut in our history.”

Today, I’m releasing my plan to pay for #MedicareForAll. Here’s the headline: My plan won't raise taxes one penny on middle-class families. In fact, we'll return about $11 TRILLION to the American people. That's bigger than the biggest tax cut in our history. Here's how:

— Elizabeth Warren (@ewarren) November 1, 2019

Warren contrasts with fellow 2020 Democrat presidential candidate Sen. Bernie Sanders (I-VT), who has admitted that the middle class will pay more in taxes; however, he claims that it will pay less in premiums and other healthcare costs.

Warren estimated that her plan would cost $52 trillion over the next years, which would require $20.5 trillion in new spending.

To offset the cost of her plan, Warren proposed an “Employer Medicare Contribution,” which replaces what companies pay to insurance companies and sends it to the federal government. In a similar manner with Obamacare’s employer mandate, businesses with fewer than 50 employees would be exempt from the Employer Medicare Contribution.

The Employer Medicare Contribution essentially amounts to an employer-side payroll tax, which many economists say harms workers in the form of suppressed wages.

The Tax Policy Center noted that the “employee bears the burden of both the employer and employee portions of payroll taxes.”

Important reminder when understanding Warren's M4A plan, "in the end, all payroll taxes are based on the labor income of workers…taxes on labor (such as payroll taxes) are paid by workers."–Saez and Zucman.

— Nicole Kaeding (@NKaeding) November 1, 2019

Former Vice President Joe Biden’s deputy campaign manager, Kate Beddingfield, has contended that “it’s impossible to pay for Medicare for All without middle-class tax increases.”

Beddingfield said that the plan “would place a new tax of nearly $9 trillion that will fall on American workers.”

As Washington Examiner editor Phillip Klein noted, even if Americans would save money on premiums and administrative costs through her Medicare for All plan, the Medicare Contribution would “still count as a tax increase.”

An Emory University healthcare expert told the Washington Post that “there’s no question” that Medicare for All “hits the middle class.”

The Committee for a Responsible Federal Budget contended that it would be “impossible” to finance Medicare for All only through taxes on the wealthy.

Further, in Warren’s plan, she proposes to fund Medicare for All through a financial transactions tax, which would likely target the country’s wealthiest. Although, some experts suggest that the tax could still soak the middle class.

Another Democrat presidential candidate — South Bend, Indiana, Mayor Pete Buttigieg — told Fox News this week that Warren’s plan “is not just the multi-trillion-dollar hole, but also the fact that most Americans would prefer not to be told that they have to abandon their private plan.”

Trump campaign Communications Director Tim Murtaugh blasted Warren’s plan as a “total disaster.”

“There are 52 trillion reasons why this plan is a total disaster,” Murtaugh said. “Best of luck to the fact checkers who now have to clean up the mess.”

However, despite her claims, Warren promised this week that she would “not sign any legislation into law for which costs for middle-class families do not go down.”