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.



You know you should give credit to the left wingnut blogs when yiou copy and paste their content. Even an off beat left wingnut blog such as the one you ripped off.


Re: "estimates."

"Estimates" = all things being equal.

Just because they have extra money, it doesn't mean that they will necessarily "spend" it.

Many consumers use extra cash in order to pay down debt.


AND, they'll have that extra money because they get healthcare subsidies, which are funded by taking away someone else's "extra" money that they actually EARNED so they can't spend it.

John Harville

But what does he know?


Aetna, Cigna and Humana are all expecting to lose money on the healthcare exchanges " citing smaller-than-expected enrollment and a skew toward older enrollees."

2015 premiums could rise 10% or more.

If the trend continues, they may just pull out of the market.

Or, taxpayers will subsidize any losses to the ins. cos. in order the help hide the mess.

What do you expect when you've got a former accomplished community organizer acting as ringmaster of the circus?


This whole topic is a complete GOP whitewash. Here's why:

#1: These are mostly people who are choosing to not work anymore. They previously had to work (many well beyond retirement age) because it was the only way they could maintain health coverage. Now, thanks to the coverage they have via Obamacare, they are able to make the choice THEY want: to work part-time, full-time or retire completely, and STILL receive health care.

#2: those jobs didn't disappear. They are still there, and become job openings for those currently unemployed.

#3: Number of jobs lost during the Bush recession/financial collapse: 8.7 million. Number of jobs gained back under Obama: 7.8 million. And Boehner is going to lecture Democrats on jobs?

So, basically, most of the complaints we hear from conservatives can be summarized as: claims that Obama has been unable to "fix the stuff their guy screwed up" quickly enough, while they fight his every effort to turn things in a positive direction. That mindset loses any sense of credibility because they have been completely unwilling to acknowledge that things have gotten betTer.

It takes some serious mental gymnastics to get yourself to believe that America is worse off today than it was in 2008, when our economy was hemorrhaghing 800,000 jobs each month. Of course, these are people who actually thought Sarah Palin was an intelligent choice for VP.


Re: "Number of jobs gained back under Obama: 7.8 million."

You continue to overlook the Federal Resv.' s ZIRP & QE policies as the main drivers for any improvement in the economic picture.

(It's from the NYT, so it's 'safe' for you to read.)

Asked repeatedly and never answered by you:

What EXACTLY are the policies of the former community organizer that are directly responsible for those employment numbers that you stated?

Obviously, in your rose-colored world he just had to 'show up'.

Regardless, with a historic low 63% U.S. labor force participation rate they're lousy.

H*ll, Rep. Pelosi and other progressive airheads claimed that Obam☭are would be a job creator. lol

The Big Dog's back

The economy had already lost 4.5 million jobs before President Barack Obama took office in January 2009, with job losses that month alone surging to 818,000. Economic contraction had also accelerated, reaching a staggering 8.9 percent annualized decline in the fourth quarter of 2008—the worst in 60 years. From this downward spiral, Obama's economic policies proved instrumental in generating and sustaining a recovery.

[See pictures of Obama's re-election campaign.]

In February 2009, Obama enacted the American Recovery and Reinvestment Act, and the pace of economic contraction and job loss immediately decelerated. As the stimulus ramped up, sustained economic growth took hold in mid-2009, and job growth resumed early in 2010—with 3.5 million jobs added since February 2010. The nonpartisan Congressional Budget Office estimates that without the Recovery Act, unemployment would have averaged roughly 10.7 percent in 2010, instead of 9.6 percent.

The Recovery Act was intended to jump-start the economy and avert a depression, not to restore full employment. The $831 billion price tag, spread over more than four years, was dwarfed by the staggering loss in economic activity caused by the bursting of the $7 trillion housing bubble. After economic growth resumed, mass unemployment and underemployment compelled more fiscal support. However, passing additional economic support through Congress proved a Herculean task.

In December 2010, the administration negotiated a payroll tax cut, continuation of emergency unemployment benefits, and targeted tax credits to sustain the delicate recovery as the stimulus began winding down. Without this boost, the economy would actually have slipped back into contraction in the first quarter of 2011.

[Opinion: Barack Obama's Un-Fair Energy Taxes.]

It should be noted that the Federal Reserve also deserves credit for extraordinary measures taken to resuscitate the financial sector and facilitate recovery. But the Fed had already maxed out its key policy lever, the federal funds rate, when Obama entered office; monetary policy could not have single-handedly revived the economy.

While the economy has improved greatly under Obama's stewardship, creating jobs for the millions of unemployed Americans who want to work remains imperative. In September 2011, Obama proposed the American Jobs Act, which would boost employment by roughly another 2 million jobs, according to numerous outside economists, including Mark Zandi.

Unfortunately, Obama's substantive jobs agenda continues to be undermined by congressional partisanship. While more must be done to restore full employment, it is unquestionable that President Obama's economic policies have been instrumental in ending the worst downturn since the Great Depression


Nice copy and paste from an opinion piece published almost two yrs. ago by lefty Andrew Fieldhouse, derpy.

"It should be noted that the Federal Reserve also deserves credit for extraordinary measures taken to resuscitate the financial sector and facilitate recovery."

He doesn't mention QE.

Progressive airheads blissfully continue to think that we can tax, borrow, print and spend our way to prosperity.

Warren Buffett called the Fed. Resv. history's greatest hedge fund.

Hedge funds NEVER implode do they?

Ask Dem contributor Bernie Madoff.


Piddle Puppy are your only so-called facts derived from left wingnut opinion pieces from left wingnt blogs? It makes it even more absurd when you complain about any linked opinion piece. You use wingnut opinion pieces for making factual points... or attempt to do so. You don't seem to good at doing it even though you won't give credit the the original writer or link to the opinion.


Andrew Fieldhouse, the writer of the piece is a member of the Economic Policy Institute.

One of the founders? Former Clinton Labor Sec'y Robt. Reich.

Robert Reich is on record of being pro infrastructure projects, but he also wants racial quotas.

Typical progressive; just throw taxpayer money down a 'vote buying' rat hole.

So much for the former community organizer's "jobs program."


coasterfan says :"#1: These are mostly people who are choosing to not work anymore. They previously had to work (many well beyond retirement age) because it was the only way they could maintain health coverage. Now, thanks to the coverage they have via Obamacare, they are able to make the choice THEY want: to work part-time, full-time or retire completely, and STILL receive health care.

Usually 65 is considered retirement age and that is when people receive medicare. Why would persons want to keep insurance if they have medicare?

Chuck U. Schumer said on meet the press Sunday that now if a single mother wishes to quit her job that she kept to have the insurance coverage now she could and stay home with the children with Obamacare. Is he saying that she will not have to pay for Obamacare as if she no longer has a job it would be difficult. Also I realize she will get a free Obama phone but who pays her rent, utilities, food, auto, clothes and other items?


Different prices for different income earners? What the heck is going on here? I wish the King would realize that once those of us who work lose our incentive to work, the result will be less jobs and tax money to give to those less motivated workers.

Dr. Information

No worries. Obama just delayed the penalty for most business's today until 2016. How F'in convenient.

Also remember hospitals will be taking a huge hit due to Obamacare. Ask any nurse how many compliant patients they see. The numbers are low. People want a magic pill or want to do what they think is best, rarely listen to the advice a Dr. gives and the result is, waalaa, they are right back in the ER again for the same condition. Thanks to that lovely thing known as ACA, these repeat visits for the same condition will not be reimbursed. Small and large hospitals across this nation are about to go broke.