Medicare Expansion (ME)

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The content of this web page is arranged under the following headings:
1. Medicare Expansion Overview
2. 2017 Calendar Year Estimated Medicare Expansion Tax Computation
3. Individual Federal Income Tax & Medicare Expansion Tax Comparisons by Size of Adjusted Gross Income
4. Estimated 2017 Medicare Expansion Tax Per Capita
5. U.S. Residents Per Individual Federal Income Tax Return
6. 2015 Health Insurance Coverage of the Total Population
7. Glossary
8. Single-Payer Health Care System National Debt Impact

1. Medicare Expansion Overview

Medicare Expansion (ME) provides mandatory health insurance coverage for everyone in the United States with a valid Social Security Number, Internal Revenue Service Individual Taxpayer Identification Number, or Internal Revenue Service Adoption Taxpayer Identification Number. ME is paid for with a ME Tax that is imposed on everyone who is required to file a U.S. Individual Income Tax Return. The ME Tax is withheld or included in estimated tax payments the same as for the Individual Income Tax. The amount of the ME Tax is directly proportional to the amount of the Individual Income Tax that is paid. Taxpayers with higher incomes pay a greater portion of the total Individual Income Tax, and will likewise pay a greater portion of the total ME Tax. No one but the individual Federal Income Tax payer is responsible for paying the ME Tax.

The universal ME health insurance will cover the health expenditures now paid by the following entities:
private health insurance companies, 
Medicare, 
Medicaid, 
the Children's Health Insurance Program (CHIP), 
the Department of Defense, 
the Department of Veterans Affairs, 
worksite health care, 
philanthropic organizations, 
the Indian Health Services, 
state and local general assistance and subsidies, 
the Maternal/Child Health federal-state partnership programs, 
vocational rehabilitation, 
the Federal General and Medical Program, 
the Federal General and Medical NEC Program, 
Affordable Care Act High Risk Pools, 
the Substance Abuse and Mental Health Services Administration (SAMHSA), 
the State of New York temporary disability insurance, 
school health, and 
public health activity. 

Federal, state, and local Workers Compensation programs are not covered by ME and remain in place. Investments in research, structures, and equipment are also not included in ME.

ME patients can go to any doctor, other health care provider, hospital, or other facility that’s enrolled in ME and accepting ME patients. Almost all medical service providers are expected to participate in the ME program because of the payment and administration efficiencies that will derive from a single-payer system.

Pre-existing conditions will be covered by ME along with the essential health benefits included in the Affordable Care Act. ME will have no yearly and lifetime coverage limits. Among the health expenditures covered by ME are the following: 
hospital,
physician & clinical,
specialized Veterans Administration health benefits,
dental services,
chiropractors, 
optometrists, 
physical therapists, 
occupational therapists, 
speech therapists, 
podiatrists, 
private-duty nurses,
home health care,
nursing care facilities & continuing care retirement communities,
residential mental health & substance abuse facilities, 
prescription drugs, 
some ambulance services,
contact lenses, 
eyeglasses & other ophthalmic products,
surgical & orthopedic products, 
medical equipment rental,
oxygen,
hearing aids,
non-prescription drugs,
surgical & medical instruments,
surgical dressings, 
diagnostic products (such as needles and thermometers), 
public health activity, and
administration expenses.

The 2017 Federal Insurance Contributions Act (FICA) Tax is composed of two rates for both the employee and the employer - (1) the Social Security tax rate is 6.2% of gross compensation with a $127,200 wage base limit and (2) the Medicare tax rate is 1.45% of gross compensation with no wage base limit. ME eliminates the 1.45% FICA Tax for Medicare. 

ME will also eliminate the need for private health insurance and Medicare premium payments. In addition, ME will eliminate the need for out-of-pocket spending for deductibles, coinsurance (copayments), and health savings accounts.

ME will not pay for services that are not medically necessary (such as elective cosmetic surgery) or are not medically approved (such as experimental drugs not approved by the Federal Drug Administration). A few long-term care expenses, such as for a private nursing home room when not medically needed, will need to be paid out-of-pocket. Out-of-pocket expenses will also be incurred for services delivered by providers that do not accept ME payments. 

The single-payer ME administrator will be the existing Centers for Medicare & Medicaid Services (CMS), which is part of the U.S. Department of Health and Human Services that currently administers Medicare, Medicaid, and the Children's Health Insurance Program (CHIP). CMS will continue to contract with private insurance companies to operate as intermediaries between the government and medical providers to administer claims and payment processing, call center services, clinician enrollment, and fraud investigation. CMS will also coordinate ME services delivery with the following existing entities:
U.S. Department of Veterans Affairs for specialized Veterans Administration health benefits,
TRICARE for Department of Defense civilians and uniformed personnel,
Indian Health Services for American Indians and Alaska Natives,
Maternal/Child Health federal-state partnership programs,
Substance Abuse and Mental Health Services Administration (SAMHSA),
school health services, and
public health activities.

ME is a pay-as-you-go program that will not add to the federal deficit. Medicare and Medicaid viability and solvency concerns are eliminated.

The 2017 Individual Federal Income Tax is expected to total $1.541543376 trillion and be distributed by Size of Adjusted Gross Income as follows:
0.002% – $1 under $5,000
0.016% – $5,000 under $10,000
0.070% – $10,000 under $15,000
0.204% – $15,000 under $20,000
0.368% – $20,000 under $25,000
0.539% – $25,000 under $30,000
1.522% – $30,000 under $40,000
2.027% – $40,000 under $50,000
6.271% – $50,000 under $75,000
7.240% – $75,000 under $100,000
21.646% – $100,000 under $200,000
20.607% – $200,000 under $500,000
10.841% – $500,000 under $1,000,000
4.571% – $1,000,000 under $1,500,000
2.855% – $1,500,000 under $2,000,000
7.174% – $2,000,000 under $5,000,000
3.963% – $5,000,000 under $10,000,000
10.071% – $10,000,000 or more
0.013% – No adjusted gross income

IF the Medicare Expansion universal health insurance program was in place today, the 2017 ME Tax is expected to total $3.229100196 trillion and will be distributed by Size of Adjusted Gross Income the same as the estimated 2017 Individual Federal Income Tax above. The amount of the ME Tax is directly proportional to the amount of the Individual Income Tax that is paid. Taxpayers with higher incomes pay a greater portion of the total Individual Income Tax, and will likewise pay a greater portion of the total ME Tax. No one but the individual Federal Income Tax payer is responsible for paying the ME Tax.

The 2017 estimated average monthly ME Tax per Individual Federal Income Tax return comparisons by Size of Adjusted Gross Income are as follows:
$66 monthly average per tax return – $1 under $5,000 adjusted gross income
$35 monthly average per tax return – $5,000 under $10,000 adjusted gross income
$46 monthly average per tax return – $10,000 under $15,000 adjusted gross income
$113 monthly average per tax return – $15,000 under $20,000 adjusted gross income
$191 monthly average per tax return – $20,000 under $25,000 adjusted gross income
$280 monthly average per tax return – $25,000 under $30,000 adjusted gross income
$409 monthly average per tax return – $30,000 under $40,000 adjusted gross income
$568 monthly average per tax return – $40,000 under $50,000 adjusted gross income
$920 monthly average per tax return – $50,000 under $75,000 adjusted gross income
$1,459 monthly average per tax return – $75,000 under $100,000 adjusted gross income
$2,960 monthly average per tax return – $100,000 under $200,000 adjusted gross income
$9,634 monthly average per tax return – $200,000 under $500,000 adjusted gross income
$30,571 monthly average per tax return – $500,000 under $1,000,000 adjusted gross income
$60,546 monthly average per tax return – $1,000,000 under $1,500,000 adjusted gross income
$88,801 monthly average per tax return – $1,500,000 under $2,000,000 adjusted gross income
$157,545 monthly average per tax return – $2,000,000 under $5,000,000 adjusted gross income
$358,118 monthly average per tax return – $5,000,000 under $10,000,000 adjusted gross income
$1,438,812 monthly average per tax return – $10,000,000 or more adjusted gross income
$5,017 monthly average per tax return – No adjusted gross income adjusted gross income

Assuming their 2016 and 2017 incomes are about the same, taxpayers can estimate their 2017 annual ME Tax liability by multiplying the amount on Line 56 of their 2016 Individual Federal Income Tax Return Form 1040 by the 2017 ME Tax Multiplier of 2.094719.

It should be noted that many Individual Federal Income Tax returns are joint returns and/or include multiple dependents – there is an estimated average of 2.14 U.S. residents per 2014 Individual Federal Income Tax return. The estimated 2017 annual ME Tax per U.S. resident is $9,886 ($824 per month).

2. 2017 Calendar Year Estimated Medicare Expansion Tax Computation

Listed next are the Medicare Expansion (ME) Tax computation steps that would have been followed if the ME Tax had first been implemented for the 2017 Calendar Year. Assuming their 2016 and 2017 incomes are about the same, taxpayers can estimate their 2017 ME Tax liability by multiplying the amount on Line 56 of their 2016 Tax Return Form 1040 by the 2017 ME Tax Multiplier of 2.094719.

Step #1. Determine the total actual ME Tax for the 2nd prior Calendar Year (2015).

Source Document: National Health Expenditures by type of service and source of funds, CY 1960-2015 [ZIP, 104KB] at https://www.cms.gov/research-statistics-data-and-systems/statistics-trends-and-reports/nationalhealthexpenddata/nationalhealthaccountshistorical.html.

ACTUAL MEDICARE EXPANSION TAX
BY SOURCE OF FUNDS
CALENDAR YEAR 2015
Expenditure Amount (Millions of Dollars)
Out of Pocket	338,150	338,150
Health Insurance	2,384,526
Private Health Insurance		1,072,057
Medicare		646,243
Medicaid (Title XIX)		545,132
Federal			344,033
State and Local			201,099
CHIP (Title XIX and Title XXI)		14,620
Federal			10,913
State and Local			3,707
Department of Defense		41,786
Department of Veterans Affairs		64,688
Other Third Party Payers and Programs	197,809
Worksite Health Care		6,066
Other Private Revenues		124,259
Indian Health Services		3,770
General Assistance		6,834
Maternal/Child Health		3,704
Federal			570
State and Local			3,134
Vocational Rehabilitation		534
Federal			412
State and Local			122
Other Federal Programs*		12,263
SAMHSA		3,473
Other State and Local Programs**		32,294
School Health		4,612
Public Health Activity	80,926
Federal Funds		11,289
State and Local Funds		69,637
GRAND TOTAL MEDICARE EXPANSION TAX	3,001,411	3,001,411
Workers' Compensation	49,416	49,416
Investment	154,733
Research		46,714
Private			5,301
Federal Gov't			34,694
State and Local Gov't			6,719
Structures		48,950
Private			41,720
Federal Gov't			2,142
State and Local Gov't			5,088
Equipment		59,069
Private			43,808
Federal Gov't			5,363
State and Local Gov't			9,898
GRAND TOTAL NATIONAL HEALTH EXPENDITURES BY SOURCE	3,205,560	3,205,560
* Other Federal Programs include OEO, Federal General and Medical, Federal General and Medical NEC,
and High Risk Pools under ACA.
** Other State and Local Programs include State and Local Subsidies and TDI
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.

Step #2. Determine the total actual ME Tax for the 12th prior Calendar Year (2005).

Source Document: National Health Expenditures by type of service and source of funds, CY 1960-2015 [ZIP, 104KB] at https://www.cms.gov/research-statistics-data-and-systems/statistics-trends-and-reports/nationalhealthexpenddata/nationalhealthaccountshistorical.html.

ACTUAL MEDICARE EXPANSION TAX
BY SOURCE OF FUNDS
CALENDAR YEAR 2005
Expenditure Amount (Millions of Dollars)
Out of Pocket	263,806	263,806
Health Insurance	1,414,601
Private Health Insurance		701,724
Medicare		339,762
Medicaid (Title XIX)		309,248
Federal			177,463
State and Local			131,785
CHIP (Title XIX and Title XXI)		7,567
Federal			5,254
State and Local			2,313
Department of Defense		26,498
Department of Veterans Affairs		29,802
Other Third Party Payers and Programs	127,402
Worksite Health Care		4,282
Other Private Revenues		70,715
Indian Health Services		2,439
General Assistance		6,195
Maternal/Child Health		3,437
Federal			622
State and Local			2,815
Vocational Rehabilitation		461
Federal			355
State and Local			106
Other Federal Programs*		6,363
SAMHSA		3,219
Other State and Local Programs**		26,928
School Health		3,363
Public Health Activity	57,161
Federal Funds		9,078
State and Local Funds		48,083
GRAND TOTAL MEDICARE EXPANSION TAX	1,862,970	1,862,970
Workers' Compensation	41,533	41,533
Investment	119,724
Research		40,318
Private			3,300
Federal Gov't			32,425
State and Local Gov't			4,593
Structures		36,136
Private			30,465
Federal Gov't			681
State and Local Gov't			4,990
Equipment		43,270
Private			32,719
Federal Gov't			3,775
State and Local Gov't			6,776
GRAND TOTAL NATIONAL HEALTH EXPENDITURES BY SOURCE	2,024,227	2,024,227
* Other Federal Programs include OEO, Federal General and Medical, Federal General and Medical NEC,
and High Risk Pools under ACA.
** Other State and Local Programs include State and Local Subsidies and TDI
SOURCE: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group.

Step #3. Determine the average annual total ME Tax increase between the 12th prior Calendar Year (2005) and the 2nd prior Calendar Year (2015).

(Step #1 GRAND TOTAL MEDICARE EXPANSION TAX) - (Step #2 GRAND TOTAL MEDICARE EXPANSION TAX) / (10 Calendar Years)
= ($3.001411 trillion) - ($1.862970 trillion) / (10 Calendar Years)
= ($1.138441 trillion) / (10 Calendar Years)
= $113,844 billion per Calendar Year

Step #4. Determine how much more or less the actual total ME tax for the 2nd prior Calendar Year (2015) is than the previously estimated total ME Tax for the 2nd prior Calendar Year (2015).

As a result of timing necessities related to the ME Tax startup, it is assumed that the actual and estimated total ME Tax for both the 2015 and 2016 Calendar Years are the same. The first estimated total ME Tax is computed for Calendar Year 2017.

Step #5. Determine the estimated total ME Tax for the 1st prior Calendar Year (2016).

The estimated total ME Tax for the 2016 Calendar Year is the sum of the actual total ME Tax for the 2015 Calendar Year (determined in Step #1) and the average annual total ME Tax increase (determined in Step #3):
($3.001411 trillion) + ($0.113844 trillion)
= $3.115255 trillion

NOTE: Effective the 2018 Calendar Year, the estimated ME Tax for the 1st prior Calendar Year will have been previously determined using all the steps in this computation.

Step #6. Determine the estimated total ME Tax for the target Calendar Year (2017).

NOTE: After the ME Tax has been implemented, the estimated total ME Tax for the target Calendar Year will be determined  a few months prior to January 1 of the target Calendar Year.

(Step #5 estimated total ME Tax for the 2016 Calendar Year) + (Step #4 total ME Tax differential for the 2015 Calendar Year) + (Step #3 average annual total ME Tax increase)
= $3.115255 trillion + $0 + $0.113844 trillion
= $3.229099 trillion

Step #7. Determine the actual Total Individual Federal Income Tax Amount and actual Number of Returns by Size of Adjusted Gross Income for the 3rd prior Calendar Year (2014).

NOTE: The actual Total Individual Federal Income Tax is on Line 56 of Tax Return Form 1040 for the 2016 Tax Year.

Source Document: "All Returns: Tax Liability, Tax Credits, and Tax Payments" for Tax Year 2014 at https://www.irs.gov/uac/soi-tax-stats-individual-statistical-tables-by-size-of-adjusted-gross-income.

Actual Tax Year 2014 Total Individual Federal Income Tax
By Size of Adjusted Gross Income
(thousands of dollars)
Size of adjusted gross income	Number of Returns	Amount ($1,000)
All returns, total	96,544,079	1,377,797,136
No adjusted gross income	6,460	175,272
$1 under $5,000	241,236	38,163
$5,000 under $10,000	1,845,010	355,490
$10,000 under $15,000	4,436,438	1,399,526
$15,000 under $20,000	5,148,628	3,619,158
$20,000 under $25,000	5,363,260	6,183,917
$25,000 under $30,000	5,337,737	8,853,958
$30,000 under $40,000	10,305,333	24,559,783
$40,000 under $50,000	9,568,328	31,863,661
$50,000 under $75,000	18,112,069	95,807,946
$75,000 under $100,000	12,586,658	105,597,836
$100,000 under $200,000	17,380,014	297,111,878
$200,000 under $500,000	4,969,144	276,486,684
$500,000 under $1,000,000	833,910	145,017,518
$1,000,000 under $1,500,000	180,246	61,373,634
$1,500,000 under $2,000,000	76,959	38,344,228
$2,000,000 under $5,000,000	109,370	96,135,699
$5,000,000 under $10,000,000	26,559	52,936,838
$10,000,000 or more	16,721	131,935,947
NOTE: Detail may not add to totals because of rounding.
Source: IRS, Statistics of Income Division, Publication 1304, August 2016

Step #8. Determine the actual Total Individual Federal Income Tax Amount and actual Number of Returns by Size of Adjusted Gross Income for the 13th prior Calendar Year (2004).

NOTE: The actual Total Individual Federal Income Tax is on Line 56 of Tax Return Form 1040 for the 2016 Tax Year.

Source Document: "All Returns: Tax Liability, Tax Credits, and Tax Payments" for Tax Year 2004 at https://www.irs.gov/uac/soi-tax-stats-individual-statistical-tables-by-size-of-adjusted-gross-income.

Tax Year 2004 Total Individual Federal Income Tax
By Size of Adjusted Gross Income
(thousands of dollars)
Size of adjusted gross income	Number of Returns	Amount ($1,000)
All returns, total	89,101,934	831,976,333
No adjusted gross income	4,556	86,064
$1 under $5,000	753,517	55,075
$5,000 under $10,000	3,883,897	713,105
$10,000 under $15,000	5,672,789	2,491,501
$15,000 under $20,000	6,143,870	5,218,299
$20,000 under $25,000	5,932,734	7,894,860
$25,000 under $30,000	5,850,586	10,675,322
$30,000 under $40,000	11,283,839	28,213,041
$40,000 under $50,000	9,467,339	33,915,521
$50,000 under $75,000	17,350,625	92,955,349
$75,000 under $100,000	10,021,150	85,557,202
$100,000 under $200,000	9,718,430	175,205,533
$200,000 under $500,000	2,345,868	139,227,163
$500,000 under $1,000,000	432,783	71,339,306
$1,000,000 under $1,500,000	103,887	31,072,424
$1,500,000 under $2,000,000	45,065	19,435,625
$2,000,000 under $5,000,000	65,501	47,962,105
$5,000,000 under $10,000,000	15,827	25,756,272
$10,000,000 or more	9,671	54,202,568
NOTE: Detail may not add to totals because of rounding.
Source: IRS, Statistics of Income Division, Publication 1304, August 2016

Step #9. Determine the average annual increases and decreases in the Number of Individual Federal Income Tax Returns by size of Adjusted Gross Income between the 13th prior Calendar Year (2004) and the 3rd prior Calendar Year (2014).

Source Documents: "All Returns: Tax Liability, Tax Credits, and Tax Payments" for Tax Year 2004 and Tax Year 2014 at https://www.irs.gov/uac/soi-tax-stats-individual-statistical-tables-by-size-of-adjusted-gross-income.

Individual Federal Income Tax Returns
By Size of Adjusted Gross Income
Tax Years 2004 and 2014
Source: IRS, Statistics of Income Division, Publication 1304, August 2016
NOTE: Detail may not add to totals because of rounding.
			Increase	Average Annual
Size of adjusted gross income	2004 No. of Returns	2014 No. of Returns	(Decrease)	Increase/(Decrease)
All returns, total	89,101,934	96,544,079	7,442,145	744,215
No adjusted gross income	4,556	6,460	1,904	190
$1 under $5,000	753,517	241,263	(512,254)	(51,225)
$5,000 under $10,000	3,883,897	1,845,010	(2,038,887)	(203,889)
$10,000 under $15,000	5,672,789	4,436,438	(1,236,351)	(123,635)
$15,000 under $20,000	6,143,870	5,148,628	(995,242)	(99,524)
$20,000 under $25,000	5,932,734	5,363,260	(569,474)	(56,947)
$25,000 under $30,000	5,850,586	5,337,737	(512,849)	(51,285)
$30,000 under $40,000	11,283,839	10,305,333	(978,506)	(97,851)
$40,000 under $50,000	9,467,339	9,568,328	100,989	10,099
$50,000 under $75,000	17,350,625	18,112,069	761,444	76,144
$75,000 under $100,000	10,021,150	12,586,658	2,565,508	256,551
$100,000 under $200,000	9,718,430	17,380,014	7,661,584	766,158
$200,000 under $500,000	2,345,868	4,969,144	2,623,276	262,328
$500,000 under $1,000,000	432,783	833,910	401,127	40,113
$1,000,000 under $1,500,000	103,887	180,246	76,359	7,636
$1,500,000 under $2,000,000	45,065	76,959	31,894	3,189
$2,000,000 under $5,000,000	65,501	109,370	43,869	4,387
$5,000,000 under $10,000,000	15,827	26,559	10,732	1,073
$10,000,000 or more	9,671	16,721	7,050	705

Step #10. Determine the average annual increases and decreases in the Individual Federal Income Tax Amount by size of Adjusted Gross Income between the 13th prior Calendar Year (2004) and the 3rd prior Calendar Year (2014).

Source Documents: "All Returns: Tax Liability, Tax Credits, and Tax Payments" for Tax Year 2004 and Tax Year 2014 at https://www.irs.gov/uac/soi-tax-stats-individual-statistical-tables-by-size-of-adjusted-gross-income.

Individual Federal Income Tax Amounts
By Size of Adjusted Gross Income
Tax Years 2004 and 2014
(thousands of dollars)
Source: IRS, Statistics of Income Division, Publication 1304, August 2016
NOTE: Detail may not add to totals because of rounding.
			Amount	Average Annual
			Increase	Increase
			(Decrease)	(Decrease)
Size of adjusted gross income	2004 Amount ($1,000)	2014 Amount ($1,000)	($1,000)	($1,000)
All returns, total	$831,976,333	$1,377,797,136	$545,820,803	$54,582,080
No adjusted gross income	$86,064	$175,272	$89,208	$8,921
$1 under $5,000	$55,075	$38,163	($16,912)	($1,691)
$5,000 under $10,000	$713,105	$355,490	($357,615)	($35,762)
$10,000 under $15,000	$2,491,501	$1,399,526	($1,091,975)	($109,198)
$15,000 under $20,000	$5,218,299	$3,619,158	($1,599,141)	($159,914)
$20,000 under $25,000	$7,894,860	$6,183,917	($1,710,943)	($171,094)
$25,000 under $30,000	$10,675,322	$8,853,958	($1,821,364)	($182,136)
$30,000 under $40,000	$28,213,041	$24,559,783	($3,653,258)	($365,326)
$40,000 under $50,000	$33,915,521	$31,863,661	($2,051,860)	($205,186)
$50,000 under $75,000	$92,955,349	$95,807,946	$2,852,597	$285,260
$75,000 under $100,000	$85,557,202	$105,597,836	$20,040,634	$2,004,063
$100,000 under $200,000	$175,205,533	$297,111,878	$121,906,345	$12,190,635
$200,000 under $500,000	$139,227,163	$276,486,684	$137,259,521	$13,725,952
$500,000 under $1,000,000	$71,339,306	$145,017,518	$73,678,212	$7,367,821
$1,000,000 under $1,500,000	$31,072,424	$61,373,634	$30,301,210	$3,030,121
$1,500,000 under $2,000,000	$19,435,625	$38,344,228	$18,908,603	$1,890,860
$2,000,000 under $5,000,000	$47,962,105	$96,135,699	$48,173,594	$4,817,359
$5,000,000 under $10,000,000	$25,756,272	$52,936,838	$27,180,566	$2,718,057
$10,000,000 or more	$54,202,568	$131,935,947	$77,733,379	$7,773,338

Step #11. Determine the estimated Total Individual Federal Income Tax Amount and estimated Number of Returns by Size of Adjusted Gross Income for the 2nd prior Calendar Year (2015).

NOTES: 
A. Estimated Total Individual Federal Income Tax Amount = (Step #7 table data) + (Step #10 average annual increases and decreases)
B. Estimated Number of Returns = (Step #7 table data) + (Step #9 average annual increases and decreases)

Estimated Tax Year 2015 Total Individual Federal Income Tax
By Size of Adjusted Gross Income
(thousands of dollars)
Size of adjusted gross income	Number of Returns	Amount ($1,000)
All returns, total	97,288,294	1,432,379,216
No adjusted gross income	6,650	184,193
$1 under $5,000	190,011	36,472
$5,000 under $10,000	1,641,121	319,728
$10,000 under $15,000	4,312,803	1,290,328
$15,000 under $20,000	5,049,104	3,459,244
$20,000 under $25,000	5,306,313	6,012,823
$25,000 under $30,000	5,286,452	8,671,822
$30,000 under $40,000	10,207,482	24,194,457
$40,000 under $50,000	9,578,427	31,658,475
$50,000 under $75,000	18,188,213	96,093,206
$75,000 under $100,000	12,843,209	107,601,899
$100,000 under $200,000	18,146,172	309,302,513
$200,000 under $500,000	5,231,472	290,212,636
$500,000 under $1,000,000	874,023	152,385,339
$1,000,000 under $1,500,000	187,882	64,403,755
$1,500,000 under $2,000,000	80,148	40,235,088
$2,000,000 under $5,000,000	113,757	100,953,058
$5,000,000 under $10,000,000	27,632	55,654,895
$10,000,000 or more	17,426	139,709,285
NOTE: Detail may not add to totals because of rounding.
Source: IRS, Statistics of Income Division, Publication 1304, August 2016

Step #12. Determine the estimated Total Individual Federal Income Tax Amount and estimated Number of Returns by Size of Adjusted Gross Income for the 1st prior Calendar Year (2016).

NOTES: 
A. Estimated Total Individual Federal Income Tax Amount = (Step #11 table data) + (Step #10 average annual increases and decreases)
B. Estimated Number of Returns = (Step #11 table data) + (Step #9 average annual increases and decreases)

Estimated Tax Year 2016 Total Individual Federal Income Tax
By Size of Adjusted Gross Income
(thousands of dollars)
Size of adjusted gross income	Number of Returns	Amount ($1,000)
All returns, total	98,032,509	1,486,961,296
No adjusted gross income	6,840	193,114
$1 under $5,000	138,786	34,781
$5,000 under $10,000	1,437,232	283,966
$10,000 under $15,000	4,189,168	1,181,130
$15,000 under $20,000	4,949,580	3,299,330
$20,000 under $25,000	5,249,366	5,841,729
$25,000 under $30,000	5,235,167	8,489,686
$30,000 under $40,000	10,109,631	23,829,131
$40,000 under $50,000	9,588,526	31,453,289
$50,000 under $75,000	18,264,357	96,378,466
$75,000 under $100,000	13,099,760	109,605,962
$100,000 under $200,000	18,912,330	321,493,148
$200,000 under $500,000	5,493,800	303,938,588
$500,000 under $1,000,000	914,136	159,753,160
$1,000,000 under $1,500,000	195,518	67,433,876
$1,500,000 under $2,000,000	83,337	42,125,948
$2,000,000 under $5,000,000	118,144	105,770,417
$5,000,000 under $10,000,000	28,705	58,372,952
$10,000,000 or more	18,131	147,482,623
NOTE: Detail may not add to totals because of rounding.
Source: IRS, Statistics of Income Division, Publication 1304, August 2016

Step #13. Determine the estimated Total Individual Federal Income Tax Amount and estimated Number of Returns by Size of Adjusted Gross Income for the target Calendar Year (2017).

NOTES: 
A. Estimated Total Individual Federal Income Tax Amount = (Step #12 table data) + (Step #10 average annual increases and decreases)
B. Estimated Number of Returns = (Step #12 table data) + (Step #9 average annual increases and decreases)

Estimated Tax Year 2017 Total Individual Federal Income Tax
By Size of Adjusted Gross Income
(thousands of dollars)
Size of adjusted gross income	Number of Returns	Amount ($1,000)
All returns, total	98,776,724	1,541,543,376
No adjusted gross income	7,030	202,035
$1 under $5,000	87,561	33,090
$5,000 under $10,000	1,233,343	248,204
$10,000 under $15,000	4,065,533	1,071,932
$15,000 under $20,000	4,850,056	3,139,416
$20,000 under $25,000	5,192,419	5,670,635
$25,000 under $30,000	5,183,882	8,307,550
$30,000 under $40,000	10,011,780	23,463,805
$40,000 under $50,000	9,598,625	31,248,103
$50,000 under $75,000	18,340,501	96,663,726
$75,000 under $100,000	13,356,311	111,610,025
$100,000 under $200,000	19,678,488	333,683,783
$200,000 under $500,000	5,756,128	317,664,540
$500,000 under $1,000,000	954,249	167,120,981
$1,000,000 under $1,500,000	203,154	70,463,997
$1,500,000 under $2,000,000	86,526	44,016,808
$2,000,000 under $5,000,000	122,531	110,587,776
$5,000,000 under $10,000,000	29,778	61,091,009
$10,000,000 or more	18,836	155,255,961
NOTE: Detail may not add to totals because of rounding.
Source: IRS, Statistics of Income Division, Publication 1304, August 2016

Step #14. Determine the ME Tax Multiplier.

ME Tax Multiplier = (Step #6 estimated total ME Tax for the 2017 Calendar Year) / (Step #13 estimated total Individual Federal Income Tax for the 2017 Calendar Year)
= $3.229099 trillion / $1.541543 trillion
= 2.094719

Step #15. Determine the estimated ME Tax for the target Calendar Year (2017).

NOTE: The ME Tax Amount is the Income Tax Returns Amount in Step #13 multiplied by the 2.094719 ME Tax Multiplier in Step #14.

Calendar Year 2017 Estimated Medicare Expansion Tax
By Size of Adjusted Gross Income
Source: IRS, Statistics of Income Division, Publication 1304, August 2016
NOTE: Detail may not add to totals because of rounding.
				Average Annual ME Tax Per Return
	Number of Income Tax Returns	Income Tax Returns Amount ($1,000)	ME Tax Amount ($1,000)
Size of adjusted gross income
No adjusted gross income	7,030	$202,035	$423,207	$60,200
$1 under $5,000	87,561	$33,090	$69,314	$792
$5,000 under $10,000	1,233,343	$248,204	$519,918	$422
$10,000 under $15,000	4,065,533	$1,071,932	$2,245,396	$552
$15,000 under $20,000	4,850,056	$3,139,416	$6,576,194	$1,356
$20,000 under $25,000	5,192,419	$5,670,635	$11,878,386	$2,288
$25,000 under $30,000	5,183,882	$8,307,550	$17,401,982	$3,357
$30,000 under $40,000	10,011,780	$23,463,805	$49,150,078	$4,909
$40,000 under $50,000	9,598,625	$31,248,103	$65,455,995	$6,819
$50,000 under $75,000	18,340,501	$96,663,726	$202,483,343	$11,040
$75,000 under $100,000	13,356,311	$111,610,025	$233,791,640	$17,504
$100,000 under $200,000	19,678,488	$333,683,783	$698,973,760	$35,520
$200,000 under $500,000	5,756,128	$317,664,540	$665,417,948	$115,602
$500,000 under $1,000,000	954,249	$167,120,981	$350,071,494	$366,855
$1,000,000 under $1,500,000	203,154	$70,463,997	$147,602,273	$726,554
$1,500,000 under $2,000,000	86,526	$44,016,808	$92,202,844	$1,065,609
$2,000,000 under $5,000,000	122,531	$110,587,776	$231,650,316	$1,890,544
$5,000,000 under $10,000,000	29,778	$61,091,009	$127,968,497	$4,297,417
$10,000,000 or more	18,836	$155,255,961	$325,217,611	$17,265,747
All returns, total	98,776,724	$1,541,543,376	$3,229,100,196	$32,691

3. Individual Federal Income Tax & Medicare Expansion Tax Comparisons by Size of Adjusted Gross Income

NOTES:
A. The Estimated Tax Year 2017 Total Individual Federal Income Tax by Size of Adjusted Gross Income is from Step #13 of the "2017 Calendar Year Estimated Medicare Expansion Tax Computation" above on this web page.
B. The Calendar Year 2017 Estimated Medicare Expansion Tax by Size of Adjusted Gross Income is from Step #15 of the "2017 Calendar Year Estimated Medicare Expansion Tax Computation" above on this web page.

Estimated Individual Federal Income Tax & Estimated Medicare Expansion Tax
Comparisons by Size of Adjusted Gross Income
Calendar Year 2017
NOTE: Detail may not add to totals because of rounding.
Source: IRS, Statistics of Income Division, Publication 1304, August 2016
Size of adjusted gross income	Individual Federal Income Tax Amount ($1,000)	Percent Total Federal Income Tax Amount	Medicare Expansion Tax Amount ($1,000)	Percent Total Medicare Expansion Tax Amount
No adjusted gross income	$202,035	0.013%	$423,207	0.013%
$1 under $5,000	$33,090	0.002%	$69,314	0.002%
$5,000 under $10,000	$248,204	0.016%	$519,918	0.016%
$10,000 under $15,000	$1,071,932	0.070%	$2,245,396	0.070%
$15,000 under $20,000	$3,139,416	0.204%	$6,576,194	0.204%
$20,000 under $25,000	$5,670,635	0.368%	$11,878,386	0.368%
$25,000 under $30,000	$8,307,550	0.539%	$17,401,982	0.539%
$30,000 under $40,000	$23,463,805	1.522%	$49,150,078	1.522%
$40,000 under $50,000	$31,248,103	2.027%	$65,455,995	2.027%
$50,000 under $75,000	$96,663,726	6.271%	$202,483,343	6.271%
$75,000 under $100,000	$111,610,025	7.240%	$233,791,640	7.240%
$100,000 under $200,000	$333,683,783	21.646%	$698,973,760	21.646%
$200,000 under $500,000	$317,664,540	20.607%	$665,417,948	20.607%
$500,000 under $1,000,000	$167,120,981	10.841%	$350,071,494	10.841%
$1,000,000 under $1,500,000	$70,463,997	4.571%	$147,602,273	4.571%
$1,500,000 under $2,000,000	$44,016,808	2.855%	$92,202,844	2.855%
$2,000,000 under $5,000,000	$110,587,776	7.174%	$231,650,316	7.174%
$5,000,000 under $10,000,000	$61,091,009	3.963%	$127,968,497	3.963%
$10,000,000 or more	$155,255,961	10.071%	$325,217,611	10.071%
TOTALS	$1,541,543,376	100.000%	$3,229,100,196	100.000%

4. Estimated 2017 Medicare Expansion Tax Per Capita

NOTES:
A. The estimated 2017 Medicare Expansion Tax is from Step #15 of the "2017 Calendar Year Estimated Medicare Expansion Tax Computation" above on this web page.
B. The estimated 2017 total U.S. resident population is from Table 1 of the United States Census Bureau web page at https://www.census.gov/population/projections/data/national/2014/summarytables.html.

Estimated 2017 Medicare Expansion Tax Per Capita = (Estimated 2017 Medicare Expansion Tax) / (Estimated 2017 Total U.S. Resident Population)
= ($3.229100196 trillion) / (326,626,000)
= $9,886

5. U.S. Residents Per Individual Federal Income Tax Return

NOTES:
A. B. The estimated 2014 United States population is from http://www.stats.indiana.edu/population/PopTotals/2016_stateest.asp 
B. The 2014 number of federal Individual Federal Income Tax Returns data is from the "All Returns: Tax Liability, Tax Credits, and Tax Payments" spreadsheet at https://www.irs.gov/uac/soi-tax-stats-individual-statistical-tables-by-size-of-adjusted-gross-income

Estimated 2014 U.S. Residents Per Individual Federal Income Tax Return = (Estimated 2014 Total U.S. Resident Population) / (2014 Total Number of Individual Federal Income Tax Returns)
= (318,563,456) / (148,606,578)
= 2.14

NOTE: The total number of 2014 federal individual income tax returns was 148,606,578. The number of nontaxable returns was 52,062,499. In other words, 35% of Americans did not pay federal income tax in 2014.

6. 2015 Health Insurance Coverage of the Total Population

Source Document: Health Insurance Coverage of the Total Population at http://kff.org/other/state-indicator/total-population/?currentTimeframe=0&sortModel=%7B%22colId%22:%22Location%22,%22sort%22:%22asc%22%7D.

The sources of health insurance coverage for the total Unites States population in 2015 is as follows:
Private Health Insurance = 65%
    49% Employer
      7% Non-Group
      9% Uninsured
Government Health Insurance = 36%
    20% Medicaid
    14% Medicare
      2% Other Public

Employer: Includes those covered by employer-sponsored coverage either through their own job or as a dependent in the same household.

Non-Group: Includes individuals and families that purchased or are covered as a dependent by non-group insurance.

Uninsured: Includes those without health insurance and those who have coverage under the Indian Health Service only.

Medicaid: Includes those covered by Medicaid, the Children’s Health Insurance Program (CHIP), and those who have both Medicaid and another type of coverage, such as dual eligibles who are also covered by Medicare.

Medicare: Includes those covered by Medicare, Medicare Advantage, and those who have Medicare and another type of non-Medicaid coverage where Medicare is the primary payer. Excludes those with Medicare Part A coverage only and those covered by Medicare and Medicaid (dual eligibles).

Other Public: Includes those covered under the military or Veterans Administration.

7. Glossary

Source Document: Definitions, Sources, and Methods [PDF, 1MB] at https://www.cms.gov/research-statistics-data-and-systems/statistics-trends-and-reports/nationalhealthexpenddata/nationalhealthaccountshistorical.html.

Administration and Total Net Cost of Health Insurance Expenditures include the administrative costs of health care programs such as Medicare and Medicaid as well as the net cost of Private Health Insurance. Net cost is the difference between private health insurance expenditures and benefits incurred and includes administrative costs, additions to reserves, rate credits and dividends, premium taxes and fees, and net underwriting gains or losses.

Children's Health Insurance Program (CHIP) is a joint federal/State program that provides health insurance for children in families that do not have health insurance coverage and are not eligible for Medicaid.

Department of Defense health care program - TRICARE - covers members of the uniformed services, their families and their survivors, as well as retired members and their families.

Durable Medical Equipment includes retail sales of items such as contact lenses, eyeglasses and other ophthalmic products, surgical and orthopedic products, medical equipment rental, oxygen and hearing aids. Durable medical equipment generally has a useful life of over three years.

Equipment is comprised of the value of new capital equipment (including software) purchased or put in place by the medical sector during the year. This measure of medical sector investment includes establishments engaged in providing health care, but does not include retail establishments that sell non-durable or durable medical goods. Non-structural equipment such as X-ray machines and beds are included in equipment.

General Assistance refers to direct payments or payments to vendors to or on behalf of needy persons who do not qualify for federally financed assistance programs. It is provided by state and local government jurisdictions, and is not financed in whole or part by federal funds. General assistance may be administered by the state welfare agency, a local agency, or a local agency under state supervision. Eligibility requirements and payment levels of general assistance programs vary greatly from state to state and often within a state.

Indian Health Services is an agency within the Department of Health and Human Services that is responsible for providing federal health services to American Indians and Alaska Natives. The provision of health services to members of federally-recognized tribes grew out of the special government-to-government relationship between the federal government and Indian tribes. Indian Health Services provides a comprehensive health service delivery system for approximately 1.9 million American Indians and Alaska Natives who belong to 566 federally recognized tribes in 35 states.

Investment includes spending for noncommercial biomedical research and expenditures by health care establishments on structures and equipment.

Maternal/Child Health is a Federal-State partnership program. States and jurisdictions design and implement a wide range of maternal and child health programs that meet national and state goals such as reducing infant mortality and the incidence of handicapping conditions among children, increasing the number of immunized children, increasing the number of children in low-income households who receive assessments and follow-up diagnostic and treatment services, providing access to comprehensive prenatal care for women; and facilitating the development of comprehensive, family-centered systems of care for children with special health care needs. The States are required by law to spend three dollars for every four federal dollars allocated.

Medicaid is a joint state and federal insurance program that is available only to certain low-income individuals and families who fit into an eligibility group that is recognized by federal and state law.

Medicare is a health insurance program for people age 65 or older, people under the age of 65 with certain disabilities, and people of all ages with end-stage renal disease.

Nursing care facilities & continuing care retirement communities are (a) freestanding private sector, local government, and state government establishments primarily engaged in providing inpatient nursing, rehabilitative, and continuous personal care services to persons requiring nursing care (including memory care); (b) continuing care retirement communities with on-site nursing care facilities; and (c) nursing facilities operated by the Department of Veterans Affairs (VA). Note: hospital-based nursing home care is categorized as hospital care.

Other Federal Programs include federal general hospital/medical expenditures, Office of Economic Opportunity , Non-XIX federal, and pre-existing conditions insurance plans. The Office of Economic Opportunity and Non-XIX Federal are both programs that no longer exist. Pre-existing conditions insurance plans were created under the Affordable Care Act to provide a health coverage option for U.S. citizens and legal residents that have been without health coverage for at least six months, have a pre-existing condition, or have been denied health coverage because of their health condition.

Other Non-durable Medical Products include non-prescription drugs (products purchased over the counter such as analgesics and cough and allergy medications) and medical sundries (items such as surgical and medical instruments and surgical dressings, and diagnostic products such as needles and thermometers). Non-durable products generally last less than three years.

Other Private Revenues are commonly provided through philanthropy. Philanthropic support may be direct from individuals or may be obtained through philanthropic fund-raising organizations such as the United Way, or other foundations or corporations. Philanthropic revenues may be spent directly for patient care or may be held in an endowment fund to produce income to cover current expenses. For institutions such as hospitals and nursing homes, other private funds also include income from the operation of gift shops, cafeterias, parking lots, educational programs, and investment income.

Other State and Local Programs include temporary disability insurance, state and local subsidies to providers, and Non-XIX state and local funding. In general, all spending by state and local governments that is not reimbursed by the federal government (through benefit payments or grants-in-aid) nor by patients or their agents is treated as state and local expenditures. Temporary disability insurance includes medical care benefits provided to workers as a result of temporary non-occupational disability or short-term sickness - this benefit is currently offered solely in the state of New York. State and local subsidies are payments by the state and local government to hospitals, home health agencies, and other facilities owned by the state. Non-XIX state and local funding is a program that no longer exists. As with federal expenditures, payment for employee health insurance by state and local governments is included under Private Health Insurance expenditures.

Out-of-Pocket spending for health care consists of direct spending by consumers for health care goods and services. Included is the amount paid out-of-pocket for services not covered by insurance and the amount of coinsurance or deductibles required by Private Health Insurance and public programs such as Medicare and Medicaid (not paid by some other third party), as well as payments covered by health savings accounts. Premium payments for insurance plans such as Private Health Insurance and Medicare are not included in out-of-pocket spending.

Private Health Insurance plans include fully-insured and self-insured health plans. Fully-insured plans are health insurance plans where the insurance company takes on all of the risk of insuring the plan’s beneficiaries. Self-insured plans are offered by employers and other groups who directly assume the major cost and risk of health insurance for their employees or members, with some self-insured employers or groups bearing the entire risk. Self-insured groups can also insure against large claims by purchasing stop-loss insurance plans. Stop-loss coverage is a form of reinsurance that limits the amount an employer will have to pay for each person’s health care (individual limit) or for the total expense of the company (group limit). In addition, some self-insured groups’ contract with traditional carriers or third-party administrators for claims processing and other administrative services while other self-insured plans are self-administered.

Public Health Activity is where the government, in addition to funding the care of individual citizens, is involved in organizing and delivering publicly provided health services such as epidemiological surveillance, inoculations, immunization/vaccination services, disease prevention programs, the operation of public health laboratories, and other such functions. The Food and Drug Administration and the Centers for Disease Control and Prevention account for the great majority of federal spending in this category. Substantial federal public health funding also comes from the Public Health and Social Services Emergency Fund and the Department of Homeland Security. State and local government public health activity expenditures are primarily for the operation of state and local health departments. Federal payments to state and local governments are deducted to avoid double counting.

School Health includes expenditures for students in primary and secondary public and private schools. This may include school nursing services, hearing and vision tests, as well as more comprehensive clinical services.

Structures are defined as the value of new construction put in place by the medical sector. This measure of the medical sector investment includes establishments engaged in providing health care, but does not include retail establishments that sell non-durable or durable medical goods. The construction measure includes new buildings; additions, alterations, and major replacements; mechanical and electric installations; and site preparation. The value of new construction put in place includes the cost of materials and labor, contractor profit, the cost of architectural and engineering work, those overhead and administrative costs chargeable to the project on the owner’s books, and interest and taxes paid during construction. Maintenance and repairs are excluded.

Substance Abuse and Mental Health Services Administration (SAMHSA) provides grants or outlays for program areas such as: Substance Abuse Treatment Capacity, Mental Health System Transformation, Strategic Prevention Framework, Co-Occurring Disorders, Seclusion & Restraint (elimination of), Older Adults, and HIV/AIDS & Hepatitis.

Vocational Rehabilitation program provides funds from the federal and state and local government for the rehabilitation of individuals with physical and mental impairments.

Workers' Compensation includes expenditures for medical benefits that are paid for by federal and state and local workers compensation programs. The U.S. Department of Labor, Office of Workers' Compensation Programs administers compensation programs which provide benefits to federal workers or their dependents that are injured at work or acquire an occupational disease. Non-federal workers’ compensation programs are financed almost exclusively by employers. All non-federal workers’ compensation programs are designed and administered by the state. Generally state laws require that all non-federal employers purchase insurance, either from commercial (private) insurers or from publicly operated state funds, or prove that they have the financial ability to carry their own risk.

Worksite Health Care represents expenditures directly provided by employers for their employees. This includes services such as those provided at an on-site health unit, such as the administration of flu shots and blood tests, or more extensive medical care such as onsite physician or hospital services.

8. Single-Payer Health Care System National Debt Impact

See http://www.finplaneducation.net/national_debt_history.htm for how the American Health Care System needs to transition to a single-payer system that is pay-as-you-go (such as this Medicare Expansion proposal)  to help get the National Debt under control.

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This page was last updated on 01/24/18.