Is ‘Obamacare a job killer’? Not so far, three studies show

U.S. Sen. Mitch McConnell and other Republican foes of federal health reform have often said “Obamacare is a job killer,” but that hasn’t happened yet, according to three new studies.

“The new analyses are still early, since a key requirement of the law began to be phased in just last year, but they add to a growing body of evidence that, if the law has had any effect on the labor market, it’s been a small one,” Max Ehrenfreund and Carolyn Y. Johnson report for The Washington Post.

While there are numerous stories about employers cutting back employee hours so they wouldn’t have to provide health insurance, or the possibility that employees would work less to become eligible for Medicaid or subsidized insurance, “They’re just not generalizable. It’s not what is mostly happening,” Larry Levitt, a Kaiser Family Foundation economist who was not involved in the new research, told the Post.

A study published in the journal Health Affairs did find that workers with little education, or aged 60 to 64, had become “slightly more likely to work part time,” apparently of their own volition, the Post reports. “One reason that some workers might be voluntarily working fewer hours is
to reduce their earnings in order to qualify for subsidized insurance from the federal government — either through the insurance marketplaces or through Medicaid.”

However, “A second Health Affairs study and a working paper issued Monday by the National Bureau of Economic Research both examined whether employees have chosen to work less in order to qualify for Medicaid, which became available to a larger group of people under health reform,” the Post notes. “The new research on the effects of the Medicaid expansion does not suggest that people are looking to limit their earnings. On the contrary, some might even be looking to work more.”

The main study, led by an economist with the Agency for Healthcare Research and Quality, “found that people were about 0.6 percentage points more likely to leave a job in the states that expanded Medicaid than in the states that maintained the program as it was, the difference was slight enough that it could have been due to chance,” the Post reports. The second study suggested that “the labor market actually looked a little bit stronger in the states that expanded Medicaid,” such as Kentucky.

McConnell said through a spokesman, “Democrats promised Obamacare would create jobs, but we all know this is just one of the myriad broken promises used to pass this horrific law. Numerous projections and analyses have found that Obamacare has led to fewer hours worked, reduced benefits, and higher taxes for employers that result in fewer benefits.” He cited a Kentucky Hospital Association report saying the law would cost the state’s hospitals $1 billion through 2020.

McConnell noted that the Congressional Budget Office is still forecasting another sort of long-term effect, as the Post story put it, “that Obamacare would discourage the equivalent of 2 million Americans from working by 2025, since they can get health insurance
without relying on an employer.”

But for now, the studies have found that “the Affordable Care Act had little impact on employment patterns,” the reporters write. They note that White Castle “has changed its scheduling practices so more employees work fewer than 30 hours a week, the threshold at which large companies don’t have to provide health coverage,” but “the studies show that White Castle is unusual.”

The major study looked at the law that requires employers with at least 100 full-time workers to offer health insurance
in 2015. That threshold became 50 employees on Jan. 1. “Critics worried that the provision would deter small businesses from expanding and would encourage them to cut their workers’ hours,” the Post notes. “But this study is the latest in a series to conclude that Obamacare did not, in fact, widely result in more firms asking employees to work part time.”

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