How Can a Health Care Bill be a Job Killer?
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.