How Much Would Single Payer Cost New York?

A bill that would create a single-payer health care system in New York is economically feasible and would save patients and employers money in the long run, but it comes with a cost. That's according to a new report by a nonpartisan research group released Wednesday.

The long-awaited report from the Rand Corporation set out to provide a thorough and apolitical analysis of The New York Health Act, a bill that has been trying and failing to make its way through the state legislature for years. The measure would provide universal insurance coverage to state residents regardless of immigration status, and would eliminate co-pays, deductibles and premiums.

According to the analysis, a single-payer system would save the system $15 billion, or 3.1 percent, by 2031 “if administrative costs and growth in provider payment rates are reduced.”

Researcher Jodi Liu co-authored the report for Rand. She said the bill's money-saving potential is a boon for single-payer's supporters. But Liu warned the report contains information that would support decorators’ viewpoint as well.

Tax payments would replace premiums and out-of-pocket payments and cover the costs of services. "New taxes would have to be very high," Liu said. The study says in order to cover the cost of the program, New York's tax revenue needs to increase by 156%. 

Liu said the possibility of raising taxes on the wealthy, or even middle-income New Yorkers, is always controversial, and that tax evasion might become more common as a result on the significantly higher rates. According to the report, if .5 percent of taxpayers in the top income tax bracket left the state, New York would lose $33.5 billion in tax revenue, and that could potentially lead to the single-payer system's collapse.

Even if lawmakers approve a single-payer plan, the federal government will need to grant a waiver to allow the system to be implemented.