Last Call

Jon Cohn puts the price tag on the Senate Medicare expansion plan.

According to the projection, under reform the government will reduce its spending on Medicare significantly. Establishing a commission on the cost of Medicare will reduce it further, although not by much in the early years. And a tax on the most expensive health insurance plans will curb spending in the private sector.

Over time, the cumulative effect of these changes will grow, so that the gap between what we'd spend on health care without reform and what we'd spend with it will shrink. In 2019, the last year of the projection, the difference--that is, the amount of extra money our society devotes to health care--is a measly $23 billion out of more than $4.5 trillion total.

That's 0.5 percent--not five percent, but zero-point-five percent. If that were the price of expanding insurance to around 40 million people, it'd be an absolute bargain.

But the actual price may be even lower, at least as time goes forward. The Medicare Actuary does not project beyond the 2019 window. But it's reasonable to assume that if the trend holds until 2019, it will hold for a few years beyond, to the point where medical care spending really would come down.

So, it's...almost reasonable, cost-wise.  The real problem is of course running the program.