ObamaCare and Jobs

Joe Paduda

Posted 2/22/12 on Managed Care Matters

Will the health reform bill kill jobs? Devastate small businesses? Push us back into recession?

According to several organizations and and anti-reform politicians, it’s the worst thing to hit the economy since the Depression.

But it turns out those doomsayers are mostly wrong.

Here’s what FactCheck.com says about these claims:

“this is health-care hooey, aimed at exploiting public concern over continuing high unemployment, with little basis in fact.

As we’ve said before (a few times), experts project that the law will cause a small loss of low-wage jobs — and also some gains in better-paid jobs in the health care and insurance industries. [emphasis added]

It’s also expected that more workers will decide to retire earlier, or work fewer hours, when they no longer need employer-sponsored insurance and can obtain it on their own with help from federal subsidies. But that just means fewer people willing to work — and it will free up jobs for those who want them. If anything, that could reduce the jobless rate.”

Here are a few factoids about the PPACA (aka Accountable Care Act) that seem to have escaped the attention of those concerned about health reform and jobs.

– some employers with fewer than 25 FTEs are already receiving government aid to help defray the cost of insurance

– employers with fewer than 50 FTEs are exempt from the requirement to provide coverage

– the original CBO analysis of reform’s impact on employment [opens pdf] indicated job losses from the employer mandate “would probably be small.”

In fact, the jobs picture, according to the CBO, is mixed.

“According to CBO’s August 2010 analysis, the legislation, on net, will reduce the amount of labor used in the economy by a small amount–roughly half a percent–primarily by reducing the amount of labor that workers choose to supply.30 That net effect reflects changes in incentives in the labor market that operate in both directions: Some provisions of the legislation will discourage people from working more hours or entering the workforce, and other provisions will encourage them to work more.”

The well-regarded Lewin Group concurs:

“Lewin’s analysis showed 150,000 to 300,000 jobs lost, all minimum wage or near minimum wage positions that would be lost permanently. That doesn’t account for increases in jobs in other sectors, mainly health care, that Sheils also expects but hasn’t quantified.”

There are entities with different opinions, but they are not neutral parties. Again, here’s FactCheck:

“a study by the National Federation of Independent Business…projecting a 1.6 million job loss…was issued Jan. 26, 2009 — well over a year before the new law was actually enacted. NFIB has not issued any study of what actually became law, and one of this study’s authors, Michael Chow, told us by e-mail that it has no present plans to do so…
NFIB did not study the new law. Its report was based on a hypothetical employer mandate that bears little resemblance to what was actually passed — and it also projects a gain of hundreds of thousands of health care and insurance industry jobs.”

I’d note that this hasn’t stopped NFIB from using the 1.6 million lost job figure when referring to jobs lost due to PPACA…

What does this mean for you?

While there are problems with PPACA, while it is far from perfect, and while it could stand improvement in many areas, no matter what NFIB et al claim, it is not a “job-killer.”

One thought on “ObamaCare and Jobs

  1. Mr. Paduda is on the right track – PPACA will create new healthcare jobs in the one environment of care where those new jobs make the most sense – Primary Care. For any primary care practice that genuinely wants to be part of the ultimate solution to aggregate healthcare spending through the intelligent and effective delivery of the preventive services mandated under reform, that practice will need to seriously adopt the medical home model of primary care which calls for an expanded staffing model. This expanded staff, as many as 3 to 4 additional team members per full time equivalent primary care physician, will fall into the category of “certified medical assistants” (CMAs) trained and certified to the level of the American Association of Medical Assistants (AAMA). Practices that really understand how to deliver these benefits to their entire inventory of “active charts” will quickly understand the economic benefit of this capability to their practices, to their patients, and to the organizations that sponsor the benefits and/or employ these patients.

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