The Affordable Care Act (ACA) is now law but the Republicans in Washington and the states are not ready to accept it. In Pennsylvania, Republican Attorney General and Gubernatorial candidate Tom Corbett has joined his colleagues from other states in filing a suit to have the whole law overturned by the courts. And he’s done so, in part, on the grounds that the the ACA will kill jobs in Pennsylvania and elsewhere.
The Republican Party has fought every effort by President Obama and Governor Rendell to create jobs. So it’s ironic to see them attacking the ACA on these grounds. And more importantly, their argument is totally backwards. For two reasons, the ACA will create jobs all over the country and especially in Pennsylvania.
First, health care reform will slow the growth in health care costs and that will lead to new jobs. Employer-paid health insurance premiums are, like wages and salaries, a cost of doing business. When insurance premiums rise, workforce growth slows and businesses sometimes cut jobs or reduce benefits. And that is especially true for small businesses, the most important creator of jobs in America. Because they can’t spread the risks of insurance over a larger number of employees, small businesses pay far more for health insurance than large big businesses. Hiring by small businesses is thus undermined.
The ACA will help control rising health care premiums in a number of ways. The health care exchanges will allow small businesses to purchase insurance at the rates available to big businesses today. It will limit the administrative and overhead costs of health insurance companies. And the reforms in delivery and payment systems that encourage higher quality and lower cost care will lead to further savings in health care costs
Providing health care more efficiently will save businesses money and allow them to expand hiring. Of course, this might also lead to a small loss of jobs in the health care industry. But this will be swamped by a second source of new jobs: those created by providing care for people who are now underserved. Right now twelve percent of Pennsylvanians have no health insurance. And many who are insured have inadequate coverage that keeps them from getting the health care they need. Providing good quality health care for all these people will lead to an expansion of health care jobs all across America. And that will especially be true in our Commonwealth where the health care industry is already large, not just in Philadelphia and Pittsburgh but in Northeast Pennsylvania where the Geisinger system is based, in the center of the state at Hershey Medical Center, in Erie and elsewhere.
Health care spending doesn’t just creates jobs, it create good jobs for people with all levels of education and training, from doctors to nurses to administrators to therapists to technicians to orderlies. All of those jobs provided above average salaries and benefits for the level of education they require, not least because many of them are unionized in our state. And many of them have career ladders that give people with different levels of education a chance to develop new skills and advance to better paid work.
Health care reform will not just create jobs in the health care industry. The wages paid to health care workers will be spent on other goods and services. Everyone, from those who grow and sell us our food to those who make and sell our clothing to those who make and sell cars to those who build our homes, will benefit.
We can predict how many jobs the ACA will create in Pennsylvania with some degree of precision. A detailed, quantitative analysis of the impact of the new law on Pennsylvania jobs, which I prepared on behalf of Health Care For American Now, shows that we can expect the ACA to create between 154,939 and 223,939 jobs in Pennsylvania between 2010 and 2019. Even at the lower figure, the unemployment rate in the Commonwealth will be 2.5 percent lower than it otherwise would be.
Tom Corbett and his Republican friends oppose the ACA not because it will reduce jobs but, rather, because it helps working people and the poor. Creating jobs and guaranteeing health care for all raises the floor for all working people and gives them leverage to improve their wages and benefits. That’s the real fear of Corbett, his friends in the Pennsylvania General Assembly who have consistently opposed health care reform in the state, and the millionaires who have been funding their campaigns.