Analysts say health care law means fewer on job

With health care less expensive for those who work fewer hours, some believe it will be a disincentive for people to work full-time
Associated Press
Feb 5, 2014

Several million American workers will cut back their hours on the job or leave the nation's workforce entirely because of President Barack Obama's health care overhaul, congressional analysts said Tuesday, adding fresh fuel to the political fight over "Obamacare."

The workforce changes would mean nationwide losses equal to 2.3 million full-time jobs by 2021, in large part because people would opt to keep their income low to stay eligible for federal health care subsidies or Medicaid, the Congressional Budget Office said. It had estimated previously that the law would lead to 800,000 fewer jobs by that year.

Republican lawmakers seized on the report as major new evidence of what they consider the failures of Obama's overhaul, the huge change in U.S. health coverage that they're trying to overturn and planning to use as a main argument against Democrats in November's midterm elections.

It's the latest indication that "the president's health care law is destroying full-time jobs," said Republican Rep. John Kline of Minnesota, chairman of the House Education and the Workforce Committee. "This fatally flawed health care scheme is wreaking havoc on working families nationwide," he said.

But the White House said the possible reduction would be due to voluntary steps by workers rather than businesses cutting jobs — people having the freedom to retire early or spend more time as stay-at-home parents because they no longer had to depend only on their employers for health insurance.

The law means people "will be empowered to make choices about their own lives and livelihoods," said White House Press Secretary Jay Carney.

CBO Director Douglas Elmendorf said the top reasons people would reduce work would be to qualify for subsidized coverage and an expanded Medicaid program but that lower wages — because of penalties on employers who don't provide coverage and looming taxes on generous health care plans — would also be a factor.

The agency also reduced its estimate of the number of uninsured people who will get coverage through the health care law. The budget experts now say 1 million more people will be uninsured this year than had been expected, partly because of the website problems that prevented people from signing up last fall.

However, it wasn't all bad news for the Obama administration. The CBO's wide-ranging report predicted that the federal budget deficit will fall to $514 billion this year, down from last year's $680 billion and the lowest by far since Obama took office five years ago.

The new estimates also say that the health care law will, in the short run, benefit the economy by boosting demand for goods and services because the lower-income people it helps will have more purchasing power. The report noted that the 2014 premiums that people pay for exchange coverage are coming in about 15 percent lower than projected, and the health care law, on balance, still is expected to reduce the federal deficit.

However, the budget experts see the long-term federal deficit picture worsening by about $100 billion a year through the end of the decade because of slower growth in the economy than they had previously predicted.

As for health care signups, the website woes have largely been cleared up, but the nonpartisan congressional analysts estimated that about 1 million fewer people will enroll through the new insurance exchanges than had been expected this year, for a total of 6 million.

Enrollment is predicted to pick up, topping 20 million in 2016. The exchanges, or online marketplaces, offer subsidized private coverage and cater mainly to middle-class people who don't have health care on the job.

The Congressional Budget Office also revised its Medicaid enrollment projection downward by about 1 million, for a new total of 8 million signups in 2014. About half the states have accepted the health law's Medicaid expansion.

What about those people whose decisions about work might be affected by the new law?

Lower-wage workers are more likely to reduce their hours or quit their jobs because of Obamacare incentives, the report said.

Although some employers will choose not to hire additional workers, or will reduce hours, the budget office said that does not appear to be the main factor.

"The estimated reduction stems almost entirely from a net decline in the amount of labor that workers choose to supply, rather than from a net drop in businesses' demand for labor," the report said.

The health care analysis is layered with complexity. The job losses are measured in "full-time-equivalent workers," which means more people are actually affected than, say, the 2 million full-time-equivalent jobs lost in 2017. It could take several part-time workers or people deciding to reduce their hours to produce the wage loss of one full-time equivalent.

The report also contains an important caveat, that the estimate of job losses is "subject to substantial uncertainty" and could be larger or smaller than predicted. There now are more than 130 million jobs in the economy.

Meanwhile, the broad federal deficit projection shows another yearly improvement. Obama inherited an economy in crisis and the first deficits ever to exceed $1 trillion. The 2009 total, swelled by the costs of the Wall Street bailout, hit a record $1.4 trillion, while the deficits of 2010 and 2011 each registered $1.3 trillion.

The agency sees the deficit sliding to $478 billion next year before beginning a steady rise years through 2024 that would bring the annual imbalance back above $1 trillion. Overall, it forecasts deficits totaling $7.3 trillion over the coming decade, about $1 trillion more than previously estimated.

"CBO expects that economic growth will diminish to a pace that is well below the average seen over the past several decades," the report said, citing an aging population and a decrease in the rate of growth in the labor force.

Tuesday's report comes as Obama and Republicans in Congress are taking a respite in the budget wars that have periodically consumed Washington since Republicans took control of the House in 2011. The declining deficit numbers mean they could feel even less urgency to act now.

A December budget agreement and last month's follow-up spending bill could buy peace through November's midterm elections. Republicans also appear to be taking a less confrontational approach to legislation needed this month to increase the government's borrowing limit to avoid defaulting on its obligations.

Comments

John Harville

So people who retire and take SS and Medicare benefits for which they've paid for years and perhaps receive other subsidies are freeloaders?

JOBSJOBSJOBS! Where are they? If the Republicans/Boehner had lived up to their 2010 promises - instead of voting 47 ties to repeal the AHCA - then all the unemployed young people wouldn't be finding a way to live off the teat.

Dr. Information

Jobs Jobs is exactly what Obama said he will bring to this country. To bad they are all part time low paying jobs. Obamacare just wiped out any recent positive news.

Nemesis

"So people who retire and take SS and Medicare benefits for which they've paid for years and perhaps receive other subsidies are freeloaders?"

Many of them, yes, insofar as those programs function as wealth redistribution for a significant percentage of their clients. If someone gets more than what they paid in would get them from a private, free will retirement plan, then yes, that's freeloading. A lot of us will get back far less than we'd get if we put the same money in a private plan. We're just the hosts.

John Harville

DIFFERENT LABOR REBELLION... Instead of employers cutting more and more full-time jobs or scheduling employers for just less than full-time benefit hours (which has been the trend for almost a decade) EMPLOYEES now will be opting for benefits without relying on an employer.
The study ALSO says it will take three part-time employees to fill the void of on fulltime employee retiring, quitting, or 'downsizing'.
Employers long have been working to 'part-time employ' to avoid paying benefits (how many part-time employees do you know? how many part-time employees with benefits do you know)
A DIFFERENT TYPE of employee 'strike'.
BRIGHT SIDE... there are thousands, maybe millions of unemployed ready to step into those jobs with just enough hours they still can qualify for government assistance.
If there is a crisis, the corporations and employers have created it. Karma is a witch!

Nemesis

" If people choose to work less hours, in order to keep their health care costs down, that is their choice."

Their choice, as you put it, is to psss along their costs to others, rather than be responsible for themselves. The problem is that those to whom they pass their costs don't get a choice.

Donegan
Darwin's choice

Great video! Isn't that one fool coasterfan?

mikesee

The less they work the less they make. The less they make the more they receive in subsidy. Get it?

So much for income equality!

John Harville

And you think this just happened?
Welcome to world of the minimum-wage, part-time workers who serve you EVERYWHERE you go.
This isn't a new phenomenom.
Employers have been reducing hours for YEARS to keep from paying insurance.
Finally the government is going to do the job not being done by FREE ENTERPRISE.

tbh

Who is they? I work for the largest healthcare system in the state of Ohio. The they you are referring to are older die hard white republicans who don't work or are laid off due to they never went to college, went straight to the local steel mill right after high school and thought that factory would never figured out a way to make more profits with less workers.

The "they" always come in and complain about the very system they are taking advantage of? Healthcare is not a right or left issue "get it"? When you are laying half dead in the emergency room or for that matter your child or parent, NOBODY says "hey doc don't treat me because I'm against the Obama healthcare system".

@mikesee, do you know what a subsidy is? Our government gave 10 banks over 2 trillion dollars so they could pay their bills and protect them from going under? two trillion dollars would cover healthcare for every american for the next 20 years! @donegan Stop posting videos and post some hard facts.

Donegan

That video struck to close to home huh?
Here's a hard fact. The CBO said that your presidents signature piece of legislation will kill another 2 million jobs. Why would you still trust a admin who signed in a bill they never even read that is destroying peoples lives and their future? Oh why do i even bother.
To those who are already struggling this is a kick in the guts.

John Harville

The CBO also identified many of those '2 million jobs' as jobs held by the Baby Boomers who are retiring in record numbers. The CBO also said they didn't consider the 'full-time-equivalent' workers waiting to fill the void.
How many jobs are being eliminated by large corporations closing stores, terminating people, upscaling to replace humans with computers?
But you just go right ahead and jump on the President and pay no attention to your Republican/Tea Party who campaigned on JOBSJOBSJOBS!!!!!
Where are they?

Donegan

H.R. 872—Reducing Regulatory Burdens Act
H.R. 910—Energy Tax Prevention Act of 2011
H.J.Res. 37—Disapproving the rule submitted by the Federal Communications Commission with respect to regulating the Internet and broadband industry practices
H.R. 1230—Restarting American Offshore Leasing Now Act
H.R. 1229—Putting the Gulf of Mexico Back to Work Act
H.R. 1231—Reversing President Obama's Offshore Moratorium Act
H.R. 2021—The Jobs and Energy Permitting Act of 2011
H.R. 2018—Clean Water Cooperative Federalism Act of 2011
H.R. 1315—Consumer Financial Protection & Soundness Improvement Act
H.R. 1938— North American-Made Energy Security Act
H.R. 2587—Protecting Jobs From Government Interference Act
H.R. 2401—Transparency In Regulatory Analysis Of Impacts On The Nation
H.R. 2681—Cement Sector Regulatory Relief Act
H.R. 2250—EPA Regulatory Relief Act
H.R. 2273—Coal Residuals Reuse and Management Act
H.R. 2433—Veterans Opportunity to Work Act
H.R. 674—To amend the Internal Revenue Code of 1986 to repeal the imposition of 3 percent withholding on certain payments made to vendors by government entities
H.Con.Res. 34—Budget for Fiscal Year 2012
All of these were either not even brought to the floor of the senate for a vote or dismissed out right by the democrats. Guess you havent noticed because your too busy on your knees begging for the al powerful Obama to help you. Oh look Wall street just got another 85 billion, Bet your proud.

mikesee

tb (get checked for it) He11 yes I know what a subsidy is. Don't forget that the feds also "subsized" GM and Chrysler with bailout money only to be rewarded with them moving more of their jobs overseas.

Personal responsibility, learn it tbh!

Contango

Re: "two trillion dollars would cover healthcare for every american for the next 20 years!"

And the U.S. would tax, print or borrow that funding from where?

Let's also remember the massive trillions of dollars of projected unfunded liablities of Soc. Sec. & Medicare and Medicaid.

anthras

tbh, If they went straight to the unionized steel mill they would most likely be Democrats. In my Bible study class there are 5 doctors, an attorney 2 business owners, a president of a large regional company and others. I would venture to say that 98% are Republican.

two trillion dollars would cover healthcare for every american for the next 20 years! Not sure how you figure just multiply 315 million by 20 years and what do you come up with? I hardly think 2T would do the job.

4-wheeler al

all the nations in the world with health care they are doing great. the nations with health care they make it work. the people that are trying too stop health care are the ones who owns health co. All the law makers state and fed. tax payers gives them best health care to them. they say we cant have it but keep paying for them

The Hero Zone's picture
The Hero Zone

"The law means people 'will be empowered to make choices about their own lives and livelihoods,' said White House Press Secretary Jay Carney."

The term being emailed out and parroted on TV (and we may see here in stories or by commentators) is "job lock". The references are that you are forced into a job you don't think is perfect and are only working full time with benefits not for the income or providing for your family but because you are beholden for the health insurance. Keep your eyes and ears open for "job lock" and the explanation that this loss of full time work is actually empowering people.

I think that Congress is "job locked" pretty severely, especially the one party that gave us this policy of freedom, financial responsibility, and ultimate liberty. We should perhaps sever them from their benefits for their own good. You know, give them all that freedom they are giving us?

Remember what the Ministry of Truth reminds us all:

WAR IS PEACE.
FREEDOM IS SLAVERY.
IGNORANCE IS STRENGTH.

Only...

UNEMPLOYMENT IS JOB FREEDOM.
IMPACTS OF LAWS ARE VOLUNTARY ACTION.
TRUST IS MANDATORY.

John Harville

HZ... don't try to pretend you're intelligent by misquoting literary works.

The Hero Zone's picture
The Hero Zone

Please correct me then. I am all eyes and ears. How/where did I misquote and in what way does it not support the sentiment attached?

Donegan

John is just Big dog under another name. He has done this before. If he is not you cannot tell the difference anyways as they never post facts just opinions that cannot be substantiated.

Nemesis

Hero Zone has consistently demonstrated a better grasp of logic than you have.

jibber jabber

WHAT really is HAPPENING is; all those people that work a SECOND job to pay for medical care, WELL guess what, they will QUIT there 2nd JOB and there will be MILLIONS of jobs avialable.
Why YOU show more REPUBLICAN scare tactics, so Stop.

There you go again

Million of PART TIME jobs will be available. So these PT folks will receive subsidies (paid by who?) to support t heir lifestyle. Hardly a winner!

John Harville

Check it out at the local JobStore or in the ads here. The only jobs available are part-time so EMPLOYERS don't have to pay benefits.
Pretend you don't have a job and begin applying for a job. Come back in a coupla days and tell us how many full-time jobs you find to apply for... or for that matter, ho many part-time jobs.

Dr. Information

You can thank Bozo and his signature Obozocare for your first 2 sentences. Bozocare = jobs killer.

Nemesis

I get unsolicited emails from Linked In with DOZENS of good full time positions every week. I also get at least one cold call a month from a recruiter about a full time position.

Steve P

deer in the headlights, always blame Fox, the liberal New York Times yesterday; "2.5 million less working will be liberating." Yet another benefit for the entitlement crew paid for by the working middle class.

Contango

But, but Rep. Pelosi said that Obama☭are would CREATE 4 million NEW jobs????

http://www.youtube.com/watch?v=n...

John Harville

Contango... but but butt... John Boehner and Eric Cantor and Mitch McConnell said in 2010 and again in 2012 that job one for Republicans would be JOBS! JOBS! JOBS! and that if we just elected them the economy would GROW! GROW! GROW! with millions of new jobs. They said the deficit would be cut.
Oh! It HAS BEEN! By about half of the $1.4 Trillion in 2010.
And your beloved CBO says that downward trend ALSO is the responsibility of this president.

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