Cost of Medicare for All: Review of the Estimates

This paper critically evaluates the estimates of the cost of Medicare for All (M4A) in the USA. Six studies that estimate the 1-year total cost of M4A in the USA are reviewed. These studies find that M4A would increase national health spending by as much as 16.9% or decrease it by 20.0%, representing a range of estimates that generates uncertainty and confusion regarding what to expect if M4A were implemented. To develop more comparable estimates, the national health spending in each study's comparison year is used as the baseline. Estimates of the change in national health spending under M4A for each report are broken down into five important components of costs and the percentage change from baseline is calculated. The assumptions regarding these cost components are evaluated for each study, and errors and inconsistencies identified. Using data from the literature and findings that are consistent across the reports where they exist, errors and inconsistencies are corrected, and new estimates of the cost components and the overall change in national health spending are calculated. After eliminating one of the reports as having methods that are too opaque to adjust and being an implausible outlier, and adjusting the findings of the remaining five reports, this paper finds that M4A would generate savings from 2.0 to 5.1% of baseline national health spending, averaging 3.9%. M4A would cost about 4% less than current national health spending, and eliminate the uninsured, expand coverage, and likely improve the health of Americans.