READ THE OTHER SIDE: Act will impose new burdens on consumers, businesses by Grace-Marie Turner
The Affordable Care Act will create a healthier population less burdened by excessive medical bills and the fear of economic ruin from getting sick.
That increased physical and financial security for consumers will translate into a healthier business environment for health providers, insurers, suppliers and the rest of our national economy.
The rapid escalation in health-care costs in the past and the burden that places on individuals has traditionally been a drag on economic growth. The ACA aims to lift that burden in several ways.
Consumers drive the economy, and they will see the most positive benefits from the health-care act. It is projected that 30 million uninsured or underinsured Americans will now be able to access affordable care because of the legislation.
That’s 30 million new customers for the health-care industry, whether it is insurance companies providing coverage, care providers delivering services or the vast network of suppliers for the industry producing health-care related products.
In 2012, health-care hiring accounted for nearly 300,000 jobs or one-sixth of the total new jobs for the year. This trend will continue under the ACA.
This alone will create jobs boosting local economies everywhere. Moreover, a more stable and less economically burdened consumer will have the confidence and ability to pay bills, take trips, and buy goods and services outside the health-care sphere as well. This, in turn, will create growth in many other sectors.
One of the largest impacts of the ACA is the expansion of Medicaid, a state-based health-care program for low-income families. Governors across the country are now deciding whether to participate in the expanded program and could see billions of dollars in new money for this care.
Improved health, both physical and financial for the poor residents of these states and others should, again, boost local economies as more invigorated citizens shop, work and start small businesses.
The current workforce should be strengthened by having more individuals now receiving the necessary care they need to stay healthy and productive as employees. Productivity produces profitability, a trend that should make any business owner happier. Healthier and more productive workers generate more income and can avoid the economic trauma of a medical crisis.
Another positive effect of the Affordable Care Act is the slowing of health insurance costs hikes. Many would argue that cost containment fell short in the ACA and there certainly is more to be done in that area.
However, it is hard to overlook the impact of adding millions of younger, healthier, and therefore lower-risk people, to insurance rolls. Young people are among the largest groups of the uninsured and directly benefit from the ACA’s provision allowing coverage through parents’ plans up to age 26. The health insurance industry stands to gain significantly from having young people enrolled, offsetting the costs of insuring older individuals and those with pre-existing conditions, thus moderating rises in premiums paid by consumers.
Some of the other positive impacts include portability of health coverage, which frees workers to move to better jobs without the fear of losing insurance, thus adding to the fluidity of the labor market; a cap on “out of pocket” expenses for lower income Americans; tax credits making it easier for individuals and small businesses to get coverage; and provisions banning the exclusion of people with pre-existing conditions. All of these provisions provide for a healthier workforce with more money to spend, boosting our economy.
Some of these impacts are already being seen and others will be soon. Any short-term hardship that may come from the implementation of the Affordable Care Act will certainly be offset by the many positives economic outcomes of providing more and better healthcare to more of the American people.
Don Kusler is executive director of Americans for Democratic Action, a liberal advocacy organization.