There has been much talk, full of sound and fury, signifying little this past week as many on both sides of the political discourse have tried to digest and then spin a recent report from the Congressional Budget Office attempting to project the possible effect of the Affordable Care Act on the country's workforce. According to the projection, by 2024 the Affordable Care Act will reduce full time-equivalent employment by about 2.5 million workers, compared to what it would be if the law hadn't gone into effect. Putting aside the fact that 10-year projections of this nature tend to be just about worthless (This latest projection is about triple what the CBO estimated when it first scored the law in 2010), the fact that detaching the availability of health insurance from a requirement of full-time employment with an employer that can provide a group plan will lead to a decrease in such employment relationships is hardly surprising. It is also not necessarily a bad thing.
Some of my fellow employment lawyers on the employer-side of the fence seem to think that anyone who is not trapped in a full-time position that they would likely not choose but for their need for group health coverage is a worthless drain on society. I think this is a little cynical and frankly a little silly. Americans already work more hours than workers in most wealthy nations. The truth of the matter is that easy availability of comprehensive, subsidized health plans will make it easier for people to retire before age 65, quit full-time jobs to start a business of their own, or shift to part-time work and spend more time raising children or attending school.
We all know someone who is stuck in a terrible low-wage job because it is the only way for them to obtain health coverage for a pre-existing condition. The ACA will serve to remedy this type of situation. The ACA will kill jobs in the same way that Social Security kills jobs. By making it easier for people in certain circumstances to get by without a full-time job or to take a job or start a business that does not provide a group health plan.
Employers and the labor market benefit from this de-linking as well. Already, statistics show health care inflation dropping for the first time in just about forever. De-linking health insurance from employment should lead to an increase in employers' ability to hire. At the same time, the decrease in unemployment that will result from some Americans choosing to work less might lead to modest pressure on low-income wages, which haven't even kept pace with inflation over the last decade.
All in all, the CBO report (if it turns out to be remotely accurate) should not be that surprising and should not be viewed as a terrible thing.