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‘Obamacare’ is transforming the job market
Last year the Congressional Budget Office (CBO) released a detailed analysis of the Affordable Care Act (ACA) that projected it would reduce the number of hours worked by 1.5 to 2.0 percent. This prompted yet another round of Republican denunciations that “Obamacare” was a job killer. The Democrats largely responded by running and hiding.
Almost no one bothered to read the analysis and note what it actually said. The projection was not that employers would cut back on the number of jobs they offered. The ACA gives people the option to buy insurance through the exchanges or in some cases to get it through Medicaid. This means that they don’t have to work at full-time jobs just to get health care insurance from an employer. The CBO was projecting that many workers would take advantage of the opportunity get insurance outside of employment and therefore work less or possibly not work at all. The real story here concerned the end of health-insurance-related job lock.
Job lock is when workers feel trapped in jobs that they don’t like, or for which they are ill suited, because they need to get health insurance from their employer. This dynamic prevents them from leaving since they don’t want to take the risk that they or their family members would be unable to get insurance in the individual market. This problem was especially serious for people with existing health conditions, because insurers charged high rates to cover people with chronic health issues, if they would provide insurance at all.
The ACA largely eliminated this problem by allowing workers to get insurance either from Medicaid or the exchanges, regardless of their health. In one of the ACA’s key reforms, insurers are no longer able to discriminate against workers based on existing conditions. Under the ACA, premiums are age-based, but a 40-year-old cancer survivor pays the same rate as a 40-year-old marathon runner in perfect health.
http://america.aljazeera.com/opinions/2015/2/obamacare-is-transforming-the-job-market.html
