As Congress gets down to business for the new year, one of the issues they are already starting to tackle is their promised repeal of the Affordable Care Act, aka "Obamacare." There will be severe consequences to deleting President Obama's landmark legislation, but the GOP isn't interested in talking about them. You'll never hear it from Republicans, but one of those consequences involves jobs.
Since the beginning, Republicans have referred to the ACA as a "job killer." In fact, their first attempt to repeal it was a bill titled "Repealing the Job-Killing Health Care Law Act." But, much to their chagrin, Obamacare hasn't been a job-killer. It has actually been a job creator, in the healthcare industry as well as in a few other related industries.
A new study by The Commonwealth Fund finds repealing the ACA could have devastating economic effects in many states. Because the law has given so many more people access to health services which they never had before, the medical sector has witnessed a huge growth in jobs. The healthcare sector added almost half a million new jobs in 2015, and through the first half of 2016 it was responsible for nearly one out of every four new jobs created.
A full repeal of Obamacare, without a replacement that would continue to make healthcare accessible and affordable, would threaten the jobs of up to 3 million workers -- not just in industries directly involved with healthcare services, but also in industries such as construction (due to a reduction in healthcare facilities expansion). One-third of the job losses would come from healthcare, with the remainder occurring in other areas. Almost all of the jobs lost would be from the private sector.
A return to the pre-ACA days, when many who didn't have insurance showed up at hospitals for treatment and were left with bills they couldn't pay, will cause costs for uncompensated care to soar by $1.1 trillion between 2019 and 2023. In addition, a George Washington University analysis says the economic impact on state economies could be enormous.
Leighton Ku, a GWU professor who is the lead author of the Commonwealth report, told CNBC,
Repealing key parts of the ACA could trigger massive job losses and a slump in consumer and business spending that would affect all sectors of state economies.
The scenario looked at in the Commonwealth study assumes Congress will end the Medicaid expansion and premium subsidies provided by the ACA. That will produce an initial budgetary savings of some $140 billion in the first year. But as the money saved by the federal government grows, so will the negative economic impacts, as shown in the table below.
Through 2023 Obamacare repeal will have saved $807 billion in the federal budget. But at the same time businesses will have seen an almost $2.6 trillion dollar loss in output. The late Congresswoman Geraldine Ferraro once famously said of Ronald Reagan, "You know the cost of everything and the value of nothing." When it comes to the ACA, modern Republicans seem to know, or care little, about either.
Donald Trump bragged throughout the campaign that he intended to "Make America Great Again" and he would bring back good paying jobs for American workers. But his other big promise, to repeal Obamacare, threatens many of the good paying jobs that are already here. If Trump and the GOP plan to gut the ACA, the Commonwealth study shows they had better have a plan for job creation that goes far beyond pretending to save a few hundred jobs at Carrier or Ford.