Albany, NY — The tax hike necessary to finance a statewide single-payer health plan would be the largest in state history and have unpredictable and potentially harmful effects for the state’s entire economy, according to a new report from the Empire Center for Public Policy.
The report analyzes the tax consequences of New York Health Act, which would switch all state residents into a single state-operated and taxpayer-financed health plan.
Although the legislation lacks specifics on how much the proposed plan would cost or where the money would come from, it’s clear that that it would push New York’s already heavy tax burden to unprecedented heights.
Drawing on available cost estimates, the report finds that New York’s combined state-and-local tax collections, which are already the highest of any state, would almost double to more than $17,000 per capita, which is three times higher than the national average.
The top marginal income tax rate would jump to an estimated 36 percent, increasing the incentives for tax flight among higher-income income individuals and higher-wage businesses.
The paper also warns that health care funding would become more vulnerable to economic booms and busts, and that rising medical costs would create pressure for further tax hikes.
“The New York Health Act requires a tax hike massive enough to disrupt the state’s entire economy, yet the bill’s authors have provided none of the details necessary to fully analyze the impact,” said report author Bill Hammond, senior fellow for health policy at the Empire Center. “It should be unthinkable that lawmakers would enact single-payer without clearly stating what it would cost and where the money would come from.”
Read the full report here.
The Empire Center, based in Albany, is an independent, not-for-profit, non-partisan think tank dedicated to promoting policies that can make New York a better place to live, work and raise a family.