Bernie Sanders ramps up criticism of Elizabeth Warren's Medicare for All plan, calling it 'quite a hit' for average workers

• Sen. Bernie Sanders ramped up his criticism of his progressive rival Sen. Elizabeth Warren on Thursday, saying her Medicare for All plan would be "quite a hit" for average workers and employers.
• During an interview for the "Deconstructed" podcast hosted by journalist Mehdi Hasan released Thursday, Sanders supported the main thrust of Warren's plan, which aims to provide comprehensive health benefits to every American with virtually no deductibles, co-payments, or premiums.
• But he expressed concern that it would ultimately hurt companies and their employees.
• Economists like Howard Gleckman of the Tax Policy Center characterized Warren's taxing method as "regressive" and effectively a "flat tax on all workers at the same firm."
• Visit Business Insider's homepage for more stories.

Sen. Bernie Sanders ramped up his criticism of his progressive rival Sen. Elizabeth Warren, saying her Medicare for All would be "quite a hit" to average workers and employers.

During an interview for the "Deconstructed" podcast hosted by journalist Mehdi Hasan released Thursday, Sanders supported the main thrust of Warren's plan, which aims to provide comprehensive health benefits to every American with virtually no deductibles, co-payments, or premiums.

But he expressed concern that it would ultimately hurt workers, saying that a payroll tax like what he has proposed to fund his plan would draw more in taxes from more affluent employees.

"When you're putting what amounts to a $9,500 'head tax' on a company that is hiring workers for $40,000 or $50,000 dollars, that's quite a hit. Quite a hit," Sanders said, referring to a uniform tax that would charge employers the same amount for each employee to fund Medicare for All.

It's the Democratic candidate's latest volley at the funding structure Warren is pushing forward. Last Friday, Sanders told ABC News that his universal healthcare plan was "much more progressive" in guarding the interests of middle-class families.

Warren rolled out her $20.5 trillion plan last week, and almost half of it relies on rerouting $8.9 trillion of employers' current healthcare spending onto the federal budget.

Under her plan, employers would pay a per-employee fee equal to 98% of their health insurance spending and annually increase payments to keep up with the cost of healthcare. Companies with fewer than 50 workers would be exempted if they don't already provide coverage.

It drew criticism among some experts. Economists like Howard Gleckman of the Tax Policy Center characterized Warren's taxing method as "regressive" and effectively a "flat tax on all workers at the same firm."

Bernie's example

He offered an example of a company offering workers insurance that cost $10,000 annually, with the employer covering $7,000 and workers paying the remaining $3,000. Warren would effectively charge the employer $6,860 - or 98% of what they're currently spending - to fund their employees' health coverage.

But it would be a hit to companies already offering generous health benefits, as their employees would be moved onto a government insurance plan available to everyone else. And the tax would effectively substitute the cost current employer healthcare spending and serve as an indirect tax on workers, the economist said.

And low-wage workers would see much larger share of their pay absorbed by healthcare spending compared to high earners.

"By contrast, a straightforward income tax or well-designed payroll tax would be much more progressive," Gleckman wrote in TaxVox.

Warren defended her plan as a slightly cheaper option to provide health insurance that would benefit companies overall.

"We stabilize it at 98% of what they're paying right now and they won't have to have HR departments that are wrestling with insurance companies," Warren told ABC News. "So this is something that's going to help employers,"

Research shows that the rapid growth in the cost of American healthcare has acted as a downward pressure on wages over the last two decades.

Though Sanders recently said he doesn't intend on releasing a payment plan for Medicare for All anytime soon, the Vermont senator released a list of nine options that could eventually pay for the plan. Among the choices is an 7.5 percent payroll tax on employers that would raise $3.9 trillion over a decade.