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Home / MCNTalk / Repealing Health Care Reform Is the Real Job Killer

January 10, 2011

Repealing Health Care Reform Is the Real Job Killer

We have been watching the pundits and partisans discuss, argue and scream about health care reform. What continues to baffle us is the ability of a number of big lies to dominate discussion, and for the topic to have become a proxy on Obama. Here is a very interesting column in the New York Times on the subject.  

The topic is too complex to dissect here but let’s address just one argument raised against change and cited by the new speaker Boehner: That health care reform is a job killer. From a recent interview on NBC:

You have to understand that in my opinion Obamacare is the biggest job killer we have in America today. It’s a weight over every employer that we have. Thereby requiring them to hold back their willingness to hire people. Secondly, I believe that Obamacare will ruin the best health care delivery system in the world. And then thirdly, I think it’ll bankrupt our country. On September 24th, when we rolled out our Pledge to America, we made clear that we wanted to repeal Obamacare. We are going to do what we said we were going to do.  Read more…

Let’s deal with some real on-the-ground experience – our own at MCN. When the founder of MCN first bought his own insurance as an individual physician in 1982, he does not remember it. This suggests that the purchase was a non-event, like insuring a car or a home.

Fast forward to 2010 and the company is annually faced with double digit increases for the same level of coverage, not unlike other companies. And the company benefits from group rates, unlike individuals who routinely face much higher increases, largely because the pools they are part of are skewed towards the sicker and higher care consumers.

Employees who leave the company are faced with COBRA expenses that are considerable and burdensome, if they choose to be covered and do not have other options. We also find ourselves increasingly cautious about adding staff. Obviously hiring decisions are complex, but the tangible cost of insurance is one further barrier to adding staff.

From a common sense and policy standpoint, we have always wondered why it is the business of an employer to provide health care for employees. It is not the employer’s job to feed, house or educated the children of employees. That is what a pay check is for. All of the above are necessities, but only one seems to be an employer cost. If everyone was employed and covered, I suppose it would be a non-issue, but that is not the case. Those employers who provide health coverage need to compete against those who do not, and this is not a fair competition in many cases, especially when in the same sector such as hospitality.

We would prefer to see in increase in taxes applicable to ALL businesses and employees — including small businesses — contributing to a system that covers all. The ability to have and pay for health care is not an option. Those who by virtue of true poverty or stupidity do not have access to coverage do not get denied care. The cost is shifted to the rest of us. A system depending upon involuntary cost shifting is not charity, it is inefficient and unfair to all.

 
Those who truly maintain their views that the Government has no place in health care I assume will be willing to burn their VA Health and Medicare cards or disavow those systems when and if they become eligible. A significant portion of the US Health spend is already government based, so it is a bit late to keep government out of it. Government involvement is not radical or unproven, but rather is the mode or some variant thereof, in many of the most robust world economies, including Canada, Australia and Germany, among others.

A claim made by those who support job creation – who doesn’t? — is that entrepreneurship is good. How does this relate to health care reform, however? What is the likelihood that an individual will leave the comfort of a secure job with health coverage for the immediate financial uncertainty of their own business — and how is this impacted by the burden of providing individual health care for the entrepreneur’s family?

This very real uncertainty as much as any other reason is why the status quo (which is not really a status quo, but rather a relentlessly increasing and unsustainable burden) is why innovation and job creation are being killed.

And a core issue that no current proposals appear to meaningfully address is the continued increase of health as a portion of GDP (17.6% in 2009) and the absence of normal market forces that come into play with most purchases. By this I refer to the buyer and the consumer being de-linked.

Witness drug companies waiving copayments on expensive drugs that get charged to the carriers (from another article in the New York Times), and witness our own behaviors that rarely involves asking — when it comes to health — “how much is it?” and shopping for alternatives.

Imagine going shopping and filling your cart in a store with no prices, and you have US health-care today. The “free marketers” who make up the health care industry decry and condemn allowing the true buyers of care – insurance companies, employers and government — when these entities suggest that they may use their purchasing power to impact price and consumption.

Our current view of patients and doctors knowing what is ‘right” while staying blind, indifferent to, or directly benefiting from the cost paid by others is not working.

Rather than reflexively engage in partisan bickering on the topic, let’s look at the reality of what we are now seeing in our businesses and lives and those of our families and neighbors – as we review our options going forward. David M. Cutler, Otto Eckstein Professor of Applied Economics, Harvard University, and a Senior Fellow at the Center for American Progress, notes that: “The imminent effort in the House of Representatives to repeal health care reform is a major step in the wrong direction if promoting economic recovery is job one.”

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Tagged: Cost Containment, Health Policy, Legal Issues, Workplace Situations 2 Comments

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  1. J. Kevin Hillyer says

    January 10, 2011 at 2:13 pm

    Employer based health care, as I understand, arose as a marketing tool for for employers attempting to land serivceman and women returning from the battlefields of Europe and the Pacific after WWII. I speculate that it grew from those origins to where it is now purely because of tradition and continued usefullness as a lure for desired employees.

    Reply
  2. Zvi Herschman, MD says

    January 31, 2011 at 12:08 pm

    May I suggest you reach for more varied, unbiased and reliable sources other then The New York Times and its agenda driven reportage. I have a small business and the cost of maintaining employees and the uncertainty of ther cost involved in hiring new ones resulted in firing 3 people in the past months. The wisdom of this decision was verified when the new premiums were revealed and increased 65% due in large part to Obamacare legislation. The math does not lie. I am not alone in yhinking so and acting so. No colleague has shown a willingness to hire a new employee (other than an unemployed relative) for fear of the costs new health care mandates and unknown taxes. This administration is a disaster for any business.

    Reply

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