Obamacare Boosts Jobs and the Economy: Report

We've been hearing it for years: The Affordable Care Act (AKA ObamaCare) was bad for jobs. From presidential campaign stumping to the pages of the Heritage Foundation, there’s been a litany of dire conclusions about the impact of the country’s first official stab at universal health care.

Most memorable (if faulty claims can be such), was Ted Cruz’ assertion in early 2016 that the health care law had “forced workers into part-time jobs.”

“It is the biggest job-killer in this country,” Cruz told the crowd after he was asked his take on the ACA. “Millions of Americans have lost their jobs.”

Even at that time, researchers knew this claim was suspect. The U.S. Bureau of Statistics indicated that part-time workers were taking on full-time work and the availability of those jobs were actually increasing. It’s true that the Congressional Budget Office (CBO) had predicted there would be job losses (and opponents of the ACA wasted no time in picking that up) because it could not foresee how small and medium-sized businesses could shoulder the cost of compliance. But study after study gradually indicated that was a false worry: U.S. businesses were innovating and workers were benefiting from having better access to health care.

Now another study suggests that the ACA has been good for the economy too. A working paper published by the National Bureau of Economic Research suggests the CBO’s fears were unfounded.

“Our findings indicate that the majority of the increase in health insurance coverage since 2013 is due to the ACA and that areas in which the potential Medicaid and exchange enrollments were higher saw substantially larger increases in coverage, write authors Mark Duggan, Gopi Shah Goda, and Emilie Jackson.

Furthermore, note the researchers, “labor market outcomes in the aggregate were not significantly affected,” or put another way, “the average labor supply effects of the ACA were close to zero.”

The earlier CBO predictions, said Seattle Times Columnist Jon Talton, “were a wash. Labor force participation did fall in places with high numbers of uninsured people who were eligible for private insurance subsidies under the act.” But at the same time, the study found, in neighborhoods where uninsured workers didn’t have enough income to qualify, they actually picked up work in order to purchase private insurance.

The Altarum Institute backed up this finding in April when it reported that the ACA was responsible for creating 240,000 jobs between 2014 and 2016. Why? Expanded coverage, the writers said.

“It really was the total change in coverage that made the difference,” Ani Turner, one of the report’s authors, told the LA Times. It created demand for doctors, nurses and other health care specialists, said Turner.

It provided an incentive for clinics to hire counselors who could help with registering new enrollees. In my own largely conservative town, where the ACA was bitterly opposed, it funneled work to insurance brokers as well.

But that doesn’t mean that the momentum will continue, say Altarum researchers. The number of new health care jobs per month have already dropped by almost half since last year (19,000 per month in 2017 compared to 32,000 in 2016).

And another report by the Milken Institute School of Public Health at George Washington University and the Commonwealth Fund predicts even worse news if Congress repeals the ACA.

Research shows that the loss of [ACA tax credits and Medicaid expansion] would lead to a doubling of the number of uninsured, higher uncompensated care costs for providers, and higher taxes for low-income Americans.” And those changes could herald the loss of 2.6 million jobs, say the researchers.

It could also bring about “serious economic distress for states.”

And the Republicans’ alternative to the ACA may not bring much relief. In fact, says Salon writer Sophia Tesafaye, the mechanics behind the American Health Care Act (also referred to as Trumpcare) could threaten the economic advances that the health care industry has seen under ACA.

“Trumpcare’s massive transfer of wealth from funding for so-called safety-net hospitals that cater to low-income Americans who have recently gained coverage under Obamacare to wealthy Americans in the form of a tax cut may result in giant cutbacks in hiring at hospitals,” said Tesafaye.

And as Tesafaye also points out, Republicans that push through a repeal may find their own jobs on the line if it results in harder economic times for voters, as is expected. According to a survey by Hart Research Associates in March, 68 percent of voters say they wanted Obamacare fixed, not repealed, more than double the number (32 percent) that wanted the health care law repealed. Other research firms have found similar results, forcing some pundits to warn that a repeal of Obamacare may not work to the Republicans political benefit. Flickr images: Angela n.