How Can a Health Care Bill be a Job Killer?

healthcare You might have heard on the news or seen in the headlines, the Republicans are trying to repeal the recently passed Health care bill because it's a "job killer." You might be thinking, that sounds odd. What effect can a health care bill have on jobs, especially if you don't work in the health care industry?

Like everything else in politics, it's complicated. The Republicans who want to repeal the bill say the law could lead some employers to hire fewer workers, and the nonpartisan Congressional Budget Office seems to give that argument some weight. Rigid requirements for employers to offer more health insurance to employees could discourage them from doing more hiring.

Two ways to see it

The law that was recently passed says that starting in 2014, employers with 50 or more employees will have to pay penalties if they fail to offer insurance -- or if their coverage does not measure up to federal standards. That might encourage some companies to keep their payrolls under 50.

Some economists agree with that, but others say that the law will eventually help employees be healthier and better taken care of, therefore cutting health costs to employers. In which case, employers would have more money to spend on expanding their businesses and perhaps on hiring. Supporters of the bill also say that health care jobs have been growing steadily, and many believe that the trend will probably continue if, as the budget office has projected, more than 30 million people gain coverage. But it would take some time for that to happen, and America needs jobs now.

"Repealing the job-crushing health care law is critical to boosting small business job creation and growing the economy," House Speaker John Boehner, R-Ohio, wrote online Monday. He's planning to open debate on the matter this week.

An unwelcome measure

There's a lot more to the issue than increasing health care costs for employers, however. There's also a requirement in the bill that says businesses must issue 1099 tax forms to any individual or corporation from which they purchase over $600 in goods or services in a year. That's a paperwork nightmare for most business owners.

If you run a company, think about having to fill out and send a 1099 to every vendor from whom you buy more than $600 in goods. Or, if you're a vendor, think about receiving hundreds of 1099s from the people you sell to. Can you imagine how many 1099s stores like Staples will receive? Even restaurants will be receiving additional tax forms.

Some say this will create jobs, as more workers will be needed to handle all the paperwork. But that's not exactly the type of work America needs most right now. Leading members of both parties have expressed concern over this part of the bill.

"A lot of our small businesses came to me (after the health care overhaul passed) and said there's a lot of paperwork I now have to fill out," Sen. Kirsten Gillibrand, D-New York, noted Sunday on CBS's 'Face the Nation.' "We can change that. That's something we can absolutely agree on."

Outcome still unclear

Supporters of the bill say that the current law slows the growth of health costs and provides greater value to consumers, taxpayers and employers in return for the $2.5 trillion a year they spend on health care. They believe that one in six Americans will be positively affected by better health care coverage.

"The effect of the law on jobs is likely to be modest," Katherine Baicker, a professor of health economics at Harvard, told the New York Times. "The most important effects of the law will be on health costs and coverage and the efficiency of the health care system, not on jobs."

If, after reading this, you're still unclear on how the new health care bill will affect employment, join the crowd. The new Republicans in Congress don't really expect to have the entire bill repealed -- it also has to get past the Democrat-dominated Senate and the President. But they hope they can accomplish a tweak here or there, and many members of both parties are open to that.

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@info: Excellent remarks, but in many ways you didn't finish your equation on the first job-killing factor mentioned. When employees are "tied to jobs" in order to hold desperately on to essential health coverage, they are thus not able to switch to jobs that are better, higher-paying, more skilled, and more responsible. This impasse a) stifles the upgrading and efficient utilization of human resources throughout all levels of the economy, dragging businesses and the economy down; and b) it fails to create the new, replacement job openings that would have been created when upwardly mobile employees moved up or on.

But the crucial final step in the equation is this: these "captive" employees today are being shamelessly exploited by corporate managements, who are squeezing more "productivity" (i.e., uncompensated worker-hours) out of them-- rather than hiring more people. They can do this because the employee is totally dependent on the employer for health-coverage continuity and has no other choice. Once workers gain more health-insurance mobility and job leverage, employers will have to build adequate staffing levels to maintain production--i.e., job creation.

Presently, large companies are coming under increasing government scrutiny for skirting both payroll-tax and health-insurance obligations by relying heavily on freelance or "contract" workers. Many of these people are working the equivalent of full-time jobs, but without benefits or security. Let's hope a crackdown will make companies upgrade these workers to full-time employee status, with benefits under the new healthcare law.

BTW, the term "Obamacare" has always bothered me. The president only laid down general principles and policies for his reform vision; the actual legislation was hammered out over many long, contentious months by numerous committees of Congress. In fact, one reason for its voluminous length is the hundreds of amendments and concessions insisted on by Republicants. As a product of our messy, democratic lawmaking process, perhaps it should simply be called "Americare."

February 04 2011 at 5:24 AM Report abuse rate up rate down Reply

Thank you, aol, for this perfect illustration of how our "liberal" mass media actually operate -- as a full-on propaganda arm for the same corporate powers that own and operate our government, both major parties... and, of course, the very mass media that the radical right have convinced everyone are "liberal."
No background, no context, and absolutely no fact-checking to determine who's telling the truth, who's spinning... and who's lying thru their teeth, which they do with complete impunity, because they know nobody in the media will ever call them on it.
The idea that the Health-Care-Finance Reform bill that wound up passing last year is a "job-killer" is ludicrous on the face of it, and readily proven as such.
One of the bigger (but nowhere near the biggest; that's coming shortly) ways the health-insurance system that we've suffered under for most of the last century has damaged our economy (and yes, this includes job-creation) is by tying employed workers to their current employers. Anyone who wants to switch to a better job, or to leave a job to start a new venture, can't do so if they, or anyone covered under their family health policy, currently has a significant medical condition, or is at risk of developing one in the near future.
Such people just can't walk away from their existing job, bcs at the very least, their existing / prior condition would not be covered under a new policy for at least some span of time, and often forever -- IF they could get one at all. Many, and probably most, people in such situations would, of course, not be able to get new coverage at all.
Therefore, these people are almost literally tied to their existing jobs -- instead of founding new firms, or taking better jobs at other firms. And don't forget, as the pols on both sides keep reminding us, it's new entrepreneurial enterprises, and small- and medium-sized companies, that have provided by far the greatest fraction of new-job growth for decades now.
NOT reforming our totally messed-up current health-care finance system is the real "job-killer" here.
But wait, there's more:
The biggest problem with our current system is that we have, quite literally, the most inefficient and ineffective health-care-finance system in the whole developed world. And it's not "the most inefficient / ineffective" by a small margin, either.
Fact #1: The US pays between 60 and 150% MORE for our health-care than does any other industrialized, "1st-world" country. Got that? We pay MORE than half-again as much as ANY country in Europe, North America, or the developed
countries of Asia / the Pacific rim, and more than DOUBLE what at least a third of such countries do.
(And yes, this is on a per-person basis, not the total for the whole population.)
Fact #2: We have the very worst health-care outcomes of any such country. THE WORST by whatever major indicators you choose: total life-expectancy at birth; remaining-life-expectancy for people now 65; remaining-healthy-years among people 65 or older; infant-mortality rates; early-childhood mortality rates; you name it.
Every last one of those, we are number 1.
Got that? We pay more, and get less, than ANY of our direct competitors in the world economy.
Now, if any of this comes as news to you, remember who's responsible: that same "liberal media" that you've been repeatedly told are in the tank for the liberals, the progressives, the Dimocrats, the nanny-staters, Hollyweird, "coastal elites," etcetc.
If some anti-American terrorists had done to us what our health-insurance-company-based health-care finance system has done to us, we'd have half the country screaming we should nuke the whole middle-east.
But because it's American insurance companies doing it, a third of the country is screaming we should leave those nice insurance companies alone to keep jacking us.
Americans, we're being played.
Look up the facts for yourself.
Talk to your friends and family in other countries.
Learn the truth.
Then get mad -- but at the right people; the ones who've been lying to us, not the ones trying to get us a better deal.

January 30 2011 at 11:22 PM Report abuse rate up rate down Reply
Hugh (Bart) Vincelette

The arguments against health care coverage for all citizens are a reminder of the reasoning offered in opposition to constitutional equality for issues like same-sex marriage.In other words; despicable nonsense. Nothing more than bigotry disguised as morality or fear mongering to suit an insurance company agenda.Why would elected officials want to deny adequate health care to the people; that they enjoy themselves? Most; if not all; of Americas allies, like Canada; have had universal health care for many years & it is successful.
It isn't socialized medicine. If the term must be used; it's socialized medical insurance.You DO get to choose your doctor & accepted treatment options aren't rationed. Canadians with money have always jumped to the head of a line, flying down to their condos in Rancho Mirage, for example, & checking into Eisenhower Medical Center.If the nation that put people on the moon & was formerly at the head of liberty & justice for all; can't afford it; cut back on the endless cash flow to the unseemly leaders in the middle east that endlessly curse America in the UN while expecting the cash flow to continue ad infinitum.

January 24 2011 at 3:25 AM Report abuse rate up rate down Reply

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