Here’s How Medicare for All Could Affect Americans

According to CNBC, 70% of Americans support Medicare for all, but the term is still murky for Americans. What does it actually mean and how could it affect Americans?

Implemented in its most historical meaning, Medicare-for-all would completely wipe out private coverage and replace it with a single-payer health insurance – a national government-run program that would cover every American. Under such a plan, deductibles, premiums, and co-payments would likely be things of the past. The government would deal directly with drug makers, which would lower prescription costs and streamline the administration process. Reuters defines it as “a publicly financed, privately delivered system with all Americans enrolled and all medically necessary services covered.”

How Much Would it Cost?

A study recently released by the Mercatus Center at George Mason University found that Sen. Bernie Sanders’ plan for universal healthcare, which is the highest-profile plan for Medicare-for-all, would increase government healthcare spending by $32.6 trillion during its first 10 years.

What Opponents Say

Supporters of Medicare-for-all are typically quick to point to Canada, which has successfully implemented a single-payer system, though Canadian citizens pay more in taxes than American citizens. Opponents argue that even as taxes and federal costs for health care rise, expenses for individuals and companies would drop, potentially canceling each other out. They’re also likely to refer to the Mercatus study for a different reason: the report suggests that national health expenditures – which include all national health spending (i.e. state Medicaid programs and private employees), not just government spending – could decline by $2 trillion over the first 10 years of implementation, though the author of the study admits that this is an unreliable number because it depends on too many variables.

What Critics Say

In 2016, the Urban Institute, a nonprofit research organization, came up with roughly the same number as the Mercatus study: $32.6 trillion over a 10-year period. Assuming both studies are correct, this would create an overwhelming financial burden on the federal government, requiring unprecedented tax hikes. Critics are also quick to liken Medicare-for-all to Medicaid rather than Medicare, claiming that if America is forced into a one-size-fits-all government program, patients will likely face long lines and delays in treatment. Moreover, the Mercatus study found that virtually any savings accrued from a single-payer plan would vanish if doctors and hospitals, who would be paid at least 10% less, wouldn’t agree to accept lower fees for patients who are now privately insured.

Healthcare reform is complicated, and the associated costs of Medicare for all have proven to be a stumbling block. Though Sanders’ plan is the most popular among Medicare-for-all advocates, he has yet to release a financing plan, so the potential impact on Americans and the healthcare industry as a whole is still uncertain.

How to Roll Over a 401(k) Plan When You Change Jobs

When you accept a new job with a new company, you need to decide what to do with the money in your 401(k) plan. Here are your options.

1. Leave the money in your former employer’s 401(k) plan

While this is typically an option, and your funds will continue to grow tax-deferred, it may not be the best option. For starters, once you move to your new place of employment, you’re no longer able to contribute to it. Another possible deterrent is the fact that your former employer could switch 401(k) providers or get bought out by a different company. Both scenarios would potentially leave you in the dark in regards to your account number or login information. However, if your new employer requires employees to work a certain length of time at the company before permitting them to partake in the 401(k) plan, leaving your 401(k) funds with your former employer temporarily might be a good game plan.

2. Roll your 401(k) to your new employer’s plan

If your new employer allows rollovers, you can have your 401(k) funds directly transferred to your new employer’s plan. This is called a “trustee-to-trustee” transfer: assets from one trustee or custodian of a retirement savings plan are transferred to the trustee or custodian of another retirement savings plan. By having your 401(k) funds directly transferred following federal rollover rules, you’ll avoid having federal income tax withheld, and your money will be easier to manage in one account. You can also have the funds transferred to a new or existing IRA.

3. Transfer your plan via an indirect rollover

Another possible alternative is to roll the funds over to another employer-sponsored retirement plan by having your 401(k) distribution check made out to you, and then depositing the funds to a new retirement savings plan. However, this particular move will require that 20 percent of the taxable portion of your distribution is withheld for federal income taxes. And if you wait beyond 60 days to redeposit the funds, the full amount of your distribution will be taxable.

Whichever way you choose to move forward with your 401(k) plan, you should be aware of rollover fees. Typically the fee is only a minimal one-time fee, but it’s worth checking in with your 401(k) provider to discuss this as well as any other questions you might have.

How Rising Gas Prices Could Affect Your Summer Travel Budget

While many Americans don’t check the stock market every day, the price of gasoline is one economic indicator Americans regularly pay attention to. And gas prices are on the rise, which means your summer travel budget could take a hit.

With the national average now likely to hit $3 a gallon this summer (as of today, Indiana’s state average is $3.01 a gallon), prices have increased by about 50 cents from this time last year. Assuming summer travelers drive roughly the same amount this year as they have previously between the months of May and September, that could translate to an increase in nearly $250 at the pump as compared to last summer (and over $300 from the summer of 2016).

Though the switch to summer blends typically causes a bump up in price each year, oil-rich countries like Saudi Arabia and Russia have successfully kept oil production down, and the price of crude oil is the highest it’s been in four years. Combined with President Trump’s announcement to withdraw from the Iran nuclear deal and possibly reinstate sanctions against the oil-rich country, prices are expected to steadily climb at the pumps.

This will affect the pockets of American consumers, which could affect the economy. In fact, research shows that American drivers are more likely to adjust their spending habits once gasoline prices hit $3 a gallon. Despite the implementation of President Trump’s Tax Cuts and Jobs Act, which stock market investors hoped would spur greater economic activity, consumers may find that the rising gas prices are eating into their take-home pay, ultimately affecting their summer travel plans.

IRS Warns of Continued Phone Scams During Tax Season

Although taxpayers should always be on the lookout for scammers and fraudulent activity, tax season is a time to be especially wary of unknown emails or phone calls. Aggressive phone scams where criminals call posed as IRS officials are extremely common and are a part of the “Dirty Dozen” list of tax-related scams targeting taxpayers. The Dirty Dozen is a list compiled annually by the IRS citing common recent scams taxpayers should be aware of.

How do these scams work? Frauds will make unsolicited calls claiming to be from the IRS and demanding individuals pay counterfeit tax bills. They may also send phishing emails or leave “urgent” phone messages with requests to call back immediately if you do not pick up. If successful, scammers will persuade their victims to send them cash either via prepaid debit card, gift card or wire transfer. Phone scammers often threaten their victims with deportation, arrest or driver’s license repeal in an attempt to bully taxpayers into sending the money.  

To further convince their victims, criminals can modify the caller ID number to appear like the IRS or another federal agency and use IRS employee titles and fake badge numbers to make the call appear official.  Frauds may also refer to the victim’s name, address or other personal information to persuade individuals of their legitimacy. Since October of 2013, the Treasury Inspector General for Tax Administration (TIGTA) has been made aware of 12,716 individuals who, due to phone scams, have paid over $63 million collectively.

The IRS also wants to remind taxpayers that while aggressive and threatening phone calls will always be a strategy used by scammers, especially during tax season, criminals do change their tactics and employ versions of this scam year round.

As a continued reminder, below are strategies frauds will use that the IRS will never use:

  1. Call via phone to demand payment using a specific payment method such as wire transfer. The IRS will mail a bill first if taxes are owed.
  2. Order that taxes be paid without allowing taxpayers to appeal or question what is owed.
  3. Ask for credit or debit card numbers over the phone.
  4. Threaten to include local police or other law enforcement for lack of payment.
  5. Call regarding a refund.

If you receive a call and think you may owe taxes, hang up immediately and call the IRS directly at 800-829-1040. If you know you do not owe taxes or are unsure, do not provide any information over the phone. Hang up and report the call the the TIGTA as well as the Federal Trade Commission. The TIGTA can be reached by phone at 800-366-4484 or on their website on the IRS Impersonation Scam Reporting page. To contact the Federal Trade Commission, go to FTC.gov and visit the FTC Complaint Assistant page and include IRS Telephone Scam in your notes.