Who Will Bear the Cost of ObamaCare? The Employees

[T]he great bulk of the cost of newly offered coverage will come, not out of profits or hiring, but out of worker cash wages. That is what happened in Massachusetts when “RomneyCare” was implemented. While there was little impact on the overall labor market, there was a striking change for those workers who gained new insurance: they saw wage reductions (relative to the trend) of almost precisely the cost of health insurance to their employers. Adding further evidence for the power of the employer side of the labor market to adjust in the face of an individual as well as an employer mandate, the number of employers offering health insurance actually increased following reform.

By Mark Pauly, et al.

Comments (9)

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  1. Devon Herrick says:

    …they saw wage reductions (relative to the trend) of almost precisely the cost of health insurance to their employers.

    Economists have argued this point for years. But so-called consumer advocates, public health advocates and left-of-center politicians prefer to believe they can mandate higher wages and have business just eat the cost.

  2. Ken says:

    This is just as economic theory would predict.

  3. Jimmy Dean says:

    Jobs always seem to be the victim to Obama’s policies.

  4. Ron says:

    I’ve come to get tired of reading so many negative outcomes our health care system will have, not to mention how bad it already was before this new law.

  5. Ryan Ritz says:

    As if health care isn’t expensive enough on the employees already? Great..

  6. Erik says:

    What employee will experience is a pass-through tax from the insurance companies that will add about 2.5-3% increase to premium. Also, with community rating and no underwriting there will be no composite rates for families. Each member will receive their own rate which will increase premiums another 1-2%. Same goes for Spousal and child coverage. At least that is here in California. But this trend should play out nationwide.

  7. Gabriel Odom says:

    +1 Devon.

    I really wanted to get paid less. Thanks Obama!

  8. Floccina says:

    Politicians are experts at getting elected and that requires knowledge of how to hide a tax and display a benefit. So the currently uninsured are forced to buy insurance but it is made to look like the employer is paying for the insurance. This is exactly what the politicians want. They get credit for forcing the employers to buy the worker insurance and that is all they want.

  9. H. James Prince says:

    “When the dust clears, employers will be making the same profits as they did before and workers will still have the same kinds of jobs as they did before—but jobs that pay less in cash and more in benefits.”

    I certainly hope their rosy prediction is right. I’ve had enough doom and gloom for this decade.