A 29% Sales Tax?

The government already pays more than half of every dollar spent on health care in the U.S. As Cato Institute’s Michael Tanner explains here, thanks to Obamacare, government-run health care may already be a reality in far more ways than most of us realize.

With little fanfare, Vermont is preparing to become the first state to implement a single-payer, government-run health-care system. The Vermont plan, if implemented, would abolish private health insurance in the state and replace it with a taxpayer-funded system under which the state government directly pays doctors and hospitals.

Of course the state is having a bit of trouble figuring out how to pay for the program’s estimated $2 billion price tag, considering that the entire state government’s operating budget is currently just $2.7 billion. Currently under consideration is an increase in the state sales tax from 6.9% to 29%.

At the same time, opponents of ObamaCare have often suggested the massive health-care program is really a stalking horse for such a government-run system. ObamaCare’s fans have sometimes suggested the same. Senate Majority Leader Harry Reid (D-Nev.) has said that the health-care law is “as step in the right direction” toward abolishing private health insurance.

But a single-payer system — or at least government-run health care — may already be a reality in far more ways than most Americans realize.

Already the government directly pays for more than half of every dollar spent on health care in this country. This compares to just 13 cents directly paid by the individual purchasing or consuming the health care. (Virtually all of the remaining 37% is paid for through insurance, much of which is also subsidized, directly or indirectly, by the government).

In fact, consumers in many countries that we associate with “socialized medicine,” such as France, actually pay more out of pocket for their health care than do Americans.

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