Trumpcare VS Berniecare

trumpcare-vs-berniecare

Updated 11/21/2016

Please note that this section of the website was published before the election results. Donald Trump and Bernie Sanders are seen as the two remaining outsiders in the presidential campaign. Donald Trump positions himself as the anti-politician businessman that will use free market principles to energize the economy and, in his words, “Make American Great Again.” Bernie Sanders is a self-proclaimed (democratic) socialist, who went from Mayor of Burlington, Vermont in the 1980’s to member of the U.S. House of Representatives in 1991 and ultimately to the Senate in 2007.

Both men were unexpected contenders in their respective parties, but were still holding on strong after Super Tuesday on March 1, 2016. Trump was leading the polls going into March and although Bernie Sanders is still a contender and trailing behind Hillary Clinton for the Democratic nomination, he is creating a movement and a lot of discussion around the changes he is demanding.

Berniecare, What Will It Offer Americans?

One change that Bernie Sanders and Donald Trump are both demanding is in healthcare. While Sanders is glad that Obamacare was passed because it was at least a step in the right direction, his position has always been that we need to do more for American citizens because healthcare should simply be a right given to all citizens. His proposal is a system that he calls “Medicare for All”. Donald Trump is not an Obamacare proponent.

This article will compare and contrast Bernie Sanders’ “Medicare for All” policy, which is also being called Berniecare, with Donald Trump’s Trumpcare healthcare reform policies. More information will be added to this article to elaborate on each candidate’s proposals as details are release.

Bernie-Care VS Trumpcare

Round 1: What should Bernie do with Obamacare?

Bernie Sanders’ “Berniecare” acknowledges that the Affordable Care Act (also known as Obamacare) was a good first step, but he says that we need to go further. He does not specifically state that he would repeal Obamacare entirely but his new plan changes almost everything about Obamacare, so more than likely, it would have to go.

Berniecare Medicare For All

Donald Trump wants Obamacare repealed immediately and states very clearly on his website that he would call on Congress to repeal the law on his very first day in office if he’s elected President.

Round 2: What kind of healthcare system should we create?

Bernie Sanders wants to adopt a healthcare system used by many countries around the world and one that was contemplated by Franklin D. Roosevelt – a single-payer system, which is akin to our present-day Medicare system. Berniecare’s single-payer system would be a federally administered, managed and federally funded program.

Trump wants to keep traditional insurance in place, meaning that we would still utilize private health insurance carriers to offer policies to Americans. Considering that TrumpCare specifically states that Obamacare would be eliminated, Donald Trump does not want to require all Americans to get health insurance. He says on his website that if a person or family chooses to be uninsured, then that is their decision.

One change that Trump does want to bring to healthcare is that he wants consumers to be able to buy plans from a carrier in another state. In today’s healthcare system, insurance policies are limited to certain geographic regions within a state and within the states themselves. Under Trumpcare, carriers would be able to offer plans across state lines and more importantly, Americans would be able to choose plans from other states, which may offer better rates. This would increase competition among carriers and give people more choices.

Round 3: What kind of coverage would this healthcare program provide consumers?

Under Bernie Sanders’ Medicare for All program, the federal government would provide an insurance policy to every American that would cover all types of medical coverage, including inpatient and outpatient care, preventative care, care by a primary care physician or specialist including coverage for related medical equipment, supplies, diagnosis and treatment of illnesses and diseases, and emergency care. If a person needs prescription drugs, rehabilitation, vision, hearing or oral health care, mental health or substance abuse or some other type of longer-term care, that would all be covered under this single-payer system as well.

Sanders boasts in his plan that there would be no such thing as an out-of-network or in-network doctor because every medical provider was paid by the same, single entity.

Bernie reasons that Americans need and deserve a single-payer, Medicare for all type system because it is not fair that, under our current system, two people with the same illness could get very different levels and types of treatment that cost differing amounts based on where they live and what they can afford.

Berniecare

Under Trumpcare, a consumer would have all of the same coverage options that they have now. Trump hopes that the overall cost of health insurance plans would come down as his programs and policies have the effect of lowering the general cost of medical treatments, which means that many American families would have the option of getting better coverage or more coverage – for instance a dental or vision plan – because they could hypothetically afford better plans.

Round 4: How will consumers save money with this system?

Under Berniecare, the government will pay almost all of the costs associated with the medical coverage. This means that an individual or family will not have to worry about paying annual deductibles or covering copays and coinsurance for certain treatment. According to Bernie Sanders’ website, so long as you have your insurance card, you have coverage.

Sanders believes that his healthcare system will save individuals and employers thousands of dollars of year. For instance, he estimated that the average family paid $4,955 in premiums in 2015 and approximately $1,318 in annual deductible payments. However, under his system, that family of four that earned approximately $50,000 would only pay $466 a year or just under $40 a month for coverage for the whole family. This money (approximately $466/year for a family earning $50,000) would be collected in the form of a 2.2% income-based premium tax charged against the total household income. Families of four that earned less than $28,800 would not pay the 2.2% income-based premium tax for their coverage, as it would be completely free to them.

Sanders’ website also states that the average cost for an employer who provided group health insurance to an employee earning around $50,000 a year was $12,591 in 2015; however under Bernie’s Medicare for All plan, the employer would only have to pay approximately $3,100 a year to cover that employee. Berniecare’s cost calculation would require employers to pay a 6.2% income-based premium tax for each employee it wanted to cover.

BernieCare also anticipates that having this single-payer, federally funded and administered healthcare program will give the government the incentive and leverage to negotiate better rates with drug companies and healthcare providers. Under the current system, Americans are beholden to the carriers that represent them to negotiate the best deals for medical services. Unfortunately, whether or not a particular medical facility or pharmaceutical drug is covered or not depends on a business decision by the carrier. But according to Sanders, under a federal single-payer system, if a facility or pharmaceutical company wants to sell their product or offer their services at all, they’ll need to bring prices in line and they’ll have to satisfy the only player in the game – the federal government who is speaking on behalf of every insured American.

Trumpcare Compared Against Berniecare

Donald Trump’s healthcare reform law is built on principles in business that are designed to increase competition and drive costs down. Trump’s plans are based on the goal that this plan needs to save consumers and save the government money because he believes that the system we have in place now, the Affordable Care Act, is not financial sustainable.

Under Trumpcare, families would be able to deduct monthly premiums from their federal income tax return, similar to what employers are able to do with the monies they pay for group health insurance plans.

Additionally, Donald J. Trump wants all families to have access to Health Savings Accounts (HSAs). Currently, the IRS only allows certain individuals who are enrolled in high deductible health plans (HDHP) to get HSAs. Under Trump’s new proposal, families – not just individuals – would be able to enroll in these types of savings plans. Not only does the whole family get to reap the benefits of the HSA account, but the family can pass the HSA down to their heirs when they pass. One of the overall benefits of an HSA is that the family and/or an individual’s employer can contribute to the HSA, the HSA stays with account owner if the person changes jobs, and the money in the account rolls over year after year.

From a budgeting standpoint, the money in the HSA can be used to pay for any out-of-pocket medical expenses and the money deposited into the account and used from the account to pay medical bills is not taxed. If the money is withdrawn and used for a non-medical reason the money will be taxed as income.

Finally, as previously mentioned, Americans should save money with Trumpcare because Trump’s policies are designed to bring down the costs of medical expenses such as pharmaceutical drug costs and the general costs of procedures. Trump wants doctors and other medical physicians to be transparent about the total costs of procedures so that Americans can shop around for the best price. He also wants Americans to be able to get prescriptions drugs from Canada or overseas, where these same drugs cost much less than in America.

Round 5: How much will this healthcare system cost the country and where will the money come from?

Bernie Sanders’ website states that his Medicare for All healthcare system will ultimately cost $6 trillion less than the current healthcare system, over the next decade. He estimates that the United States pays approximately $3 trillion a year or $10,000 a person per year, currently, but that the overall costs will come down simply by streamlining payments and by ensuring that all Americans are becoming healthier because they all have access to the same standard and type of health coverage.

More specifically, Sanders states that the individual, household premium tax of 2.2% of total household income would contribute approximately $210 billion a year towards the healthcare program.

Sanders also approximates that the 6.2% employer, income-based premium tax per covered employee would contribute approximately $630 billion per year.

In addition to those direct sources of funding, Berniecare plans to contribute traditional income tax monies to the program. Bernie’s tax rate reform would increase the tax rate per household based on income, which aligns with his mantra that the wealthy should pay their fair share of taxes. For instance, the tax rate for a household earning $250,000 and $500,000 would be 37% of Bernie Sanders’ presidency compared to 33% – 35% in 2016 under the present tax rate brackets. If a household earned $500,000 to $2 million, they would pay 43% a year in taxes. Presently, the tax rate caps out at 39.6% for households that earn more than $441,000 a year.

In addition to traditional income tax monies, Berniecare would also be funded by the new tax on capital gains. Previously people would receive a better tax rate on capital gains expenditures, but under Bernie Sanders, capital gains would be taxed the same as regular income based on the tax bracket.

Bernie Sanders also plans to fund Berniecare from the increased tax revenue the federal government would receive from limiting the tax deductions now available to households making over $250,000 and through the Responsible Estate Tax, which taxes estates differently that are over $3.5 million, and finally, employers would pay more in taxes because they wouldn’t get to write off the monies it spent for group health insurance because expensive group health policies would disappear under the single-payer system.

Donald Trump wants to eliminate government spending on healthcare for the under 65 year old market, including funding of Medicaid, which is discussed in more detail below. Although Trumpcare believes that the federal government needs to be involved in creating policies that will allow for his proposals to take place, he doesn’t necessarily want the federal government to fund any of these changes.

Round 6:What about pharmaceutical drugs?

Both Bernie Sanders and Donald Trump share the same view on this point – they want to negotiate lower rates on pharmaceutical drugs and they want Americans to be able to get cheaper but equally effective drugs from other countries, which increases competition in the U.S.

Donald Trump states in his healthcare reform proposal that he wants to remove the barriers that prohibit foreign pharmaceutical companies from being able to market to Americans and barriers that prohibit Americans from shopping for drugs overseas and in Canada.

Sanders goes a step further and outlines an entire plan on how exactly he would decrease the costs of pharmaceutical drugs. Bernie Sanders stated in his prescription drug plan that, based on his research, one in five Americans ages 19-64, did not get a prescription filled because they could not afford the drug. He also states that more than half of Americans are taking at least one prescription a day, which amounted to approximately 4.3 billion prescriptions and $370 billion in 2015.

In order to bring these costs down, Berniecare proposes that government change the law and allow the Medicare program to negotiate better costs with the drug companies. Sanders believes that renegotiating rates would save the Medicare program $230 billion – $541 billion over the next 10 years. Sanders also proposes that individuals, wholesalers and doctors or pharmacists should be allowed to order prescriptions from licensed pharmacies in Canada. Canada offers the exact same drugs as American pharmacies but at a much lower cost and Sanders believes that Americans should be able to take advantage of these savings. If this provision was passed, the Customs Department would not be able to destroy packages imported that contained prescription drugs.

Bernie Sanders’ prescription drug policy also wants the government to no longer include provisions in international trade deals that would increase the costs of prescription drugs or to allow anti competition deals and monopoly periods from being created or negotiated that would allow brand name drug manufacturers from preventing competition from its generic counterparts for long periods of time.

Finally, Sanders wants drug companies to reveal the true costs of prescriptions including research and development costs and to overall be more transparent with Americans. He also wants drug companies that commit fraud on the American people to never be given a monopoly period of drugs again.

Round 7: What would happen to original Medicare (For Those Over 65)

Today’s Medicare system is made up of four parts, all of which are either entirely or mostly funded by the federal government for most people. The four parts are: Medicare Part A (insurance you would use if you went to the hospital), Medicare Part B (insurance you would use if you went to a doctor or needed lab tests), Medicare Part C (also referred to as Medicare Advantage, covers the same claims that Part A and B cover but is offered by a private carrier) and Medicare Part D (prescription drug coverage).

Medicare Parts A and B are collectively called Original Medicare and is completely administered and managed by the federal government. If an individual paid Medicare taxes from their paycheck for at least 10 years of their life, Medicare Part A will be free; however if they did not, they may have to pay a monthly premium for that coverage. Most individuals have to pay a monthly premium for Part B as well.

Medicare Part C or Medicare Advantage is manged and administered by a private carrier. Some plans may end up being more expensive than the total monthly premium costs of Original Medicare if a person opts for a really good Medicare Advantage plan. Many plans offer additional coverage for hearing, vision, dental and prescription drugs as well, which is why they can get more expensive. Any money that the government would have spent on an individual if they had been on Original Medicare goes to the private carrier to cover the Medicare Advantage plan costs.

Medicare Part D plans are also administered by private carriers but are again, partially funded or at least made cheaper by money contributed by the federal government. A person may have to pay more for a better Part D plan so their choices are flexible based on their budget.

Bernie Sanders wants to create a Medicare for All type healthcare program for the under 65 market, so it seems possible that he would leave Original Medicare in tact as well. Because Sanders does not want to offer health coverage options to Americans that are through private carriers, he may also choose to abandon the Medicare Part C and may choose to roll Medicare Part D coverage into Original Medicare.

Bernie Sanders also stated in his prescription drug plan that he wanted to create a system where Medicare could negotiate better drug rates with pharmaceutical manufacturers. Bernie’s prescription drug policy, which is part of BernieCare, also states that he would want to close the donut hole in Medicare Part D. The donut hole arises after Medicare pays a certain amount of money towards that individual’s prescription drug costs for a given year. After the threshold is reached, the individual is required to pay the costs of the prescription drugs entirely until they again reach another threshold amount, which changes every year. At that point, Medicare picks back up until the new year starts. Under the Affordable Care Act the donut hole closes every year until 2020 when it is closed forever, meaning that Medicare Part D will always pay the prescription drug costs for the individual after 2020. Under BernieCare, the donut hole will close sooner — in 2017.

Another reform proposal to Part D in the BernieCare prescription drug section is that Sanders wants Medicare to receive the same drug discounts for low income seniors that Medicaid receives so that the drugs are not only included in more Part D plans, but is more affordable for the senior and the plan so that overall costs can be brought down.

Donald Trump shares this view as well. He states in point seven of his healthcare reform proposal that the government needs to rid itself of the special interest ties that drive up costs of pharmaceutical drugs and allow Americans to shop more freely for the best price, including from companies that are overseas. Trump also reiterated this position during a speech he gave in Farmington, New Hampshire on January 25, 2016.

Round 8: What would happen to Medicaid Programs

Bernie Sanders does not discuss Medicaid specifically in his healthcare reform plan. He does state in his prescription drug policy that if the cost of a generic or brand name drug increases disproportionately to inflation, meaning that the cost rises too much, that generic and brand name drug companies must offer an additional rebate to Medicaid recipients.

Trumpcare proposes a big change to Medicaid. Under Trump’s healthcare reform proposal, the federal government would not longer support or contribute financially to the state-run Medicaid program. Trump reasons that if the states were left to run and fund Medicaid entirely on their own, they would be more cautious of fraud and would have more of an incentive to improve their state’s economy and job market so that people could exist the Medicaid system.