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ACA Fail Fractal
Three Studies Confirm: ACA Is a Job-Killer

Three new surveys confirm that employers are cutting jobs due to the pressures of the ACA, according to a new WSJ report. First up is the a special business survey conducted by the Federal Reserve Bank of Philadelphia:

18.2% are cutting jobs and employees. Some 18% shifted the composition of their workforce to a higher proportion of part-time labor. And 88.2% of the roughly half of businesses that modified their health plans as a result of ObamaCare passed along the costs through increasing the employee contribution to premiums, an effective cut in wages.

Those results are consistent with a New York Fed survey, also out this week, that asked “How, if at all, are you changing (or have you changed) any of the following because of the effects that the ACA is having on your business?” For “number of workers you employ,” 21% of Empire State manufacturers and 16.9% of service firms answered “reducing.”

A third study from the Atlanta Fed rounds off the recent evidence—it found that 34 percent of responding businesses intended to start using part time workers more than they had in the past. Earlier this year, when evidence emerged that workers were leaving jobs because they had an alternative source of health insurance to their employers, many pundits spun it as a triumph for Obamacare. This will be harder to explain away.

We now know that the ACA is resulting in narrower networks, fewer jobs, and, in some states, higher premiums. Some of these failures are only marginal, some are more serious. But even the year-on-year decline of our health care system is more than enough reason to be concerned. The ACA has not fixed our problems, and, in many ways, has made things worse.

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  • Reticulator

    ACA was never intended to make healthcare better. But you have to overpromise if you want to get something like this passed. Otherwise it has no chance of competing against market alternatives.

    • Corlyss

      I think in this case “overpromise is a euphemism for “lie!” Here’s the part that puzzles moi: with all their experience with bureaucrats, how in God’s name could voters EVER have allowed themselves to be so gullible? There were PLENTY of warnings that the outcomes couldn’t possibly be what the Dems were assuring folks they would be.

      • Gene

        You grossly overrestimate the role of rationality in our national life.

        • Corlyss

          Yes. I’ve been told that before. I’m an optimist.

      • Andrew Allison

        The voters didn’t get to participate in the crafting of this monstrosity. Neither did the Republicans in Congress nor. as Pelosi made clear by “We have to pass the bill to find out what’s in it,” most Democrats. With luck, the latter will pay the price for voting for it in November.

      • Boritz

        Leading up to the 2012 election I heard a realtor interviewed about how he would vote. He said he was voting for Obama because his industry was in terrible straits and Obama had come through with a bail-out that saved his job. This is how typical voters process the data available to them including those plenty of warnings.

  • ljgude

    These articles detailing the progression of accommodations by employers, providers, patients and insurance companies are useful in that they show just how far reaching the disruptions to all the players actually are. But they have to be understood with the knowledge that the US had the world’s most expensive medical system – twice the OECD average – going into the ACA. It has been suggested previously on AI that healthcare costs have already risen from 16% of GDP to 17% while the ACA itself limits the increase to 17.5% by 2017. So under this increased cost pressure the players are ducking and diving. More part time workers, more companies with less than 50 employees. More consumers making employment decisions that will qualify them for significant subsidies. Insurance companies cutting deals with providers while increasing deductibles etc. Everyone passing the baby. It just isn’t clear exactly how it will work out, but like with the housing bubble all the shortfalls will work their way through the system until they become part of the national debt.

    • dan

      Liberals used to focus on “root causes”–what were the causes for those climbing costs? Was it because the cost of healthcare was hidden through the insurance system? If so, then reforming that system would be a solution, and forcing people to buy insurance (so that they would use more services) would not be.

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