Obamacare and Part-Time Work

When the jobs report came out yesterday, there was immediately a push back to the conservative argument that Obamacare is causing companies to cut their employees’ hours back to avoid the employer mandate penalty. The employer mandate requires employers with more than 50 workers to offer affordable health insurance to all full-time employees (defined as those working 30 or more hours a week). If they don’t do so, the firms must pay a fine of $2,000 per employee.

Many conservatives predicted that employers would cut back hours to get under that threshold. Liberals are concerned about that as well. But a meme popped up about a month ago that Obamacare was already cutting back worker hours. This never made any sense from the start. The Obama administration delayed the employer mandate until 2015. If employers were cutting back hours already, they’re doing so more than a year in advance. Why would they be doing that? It never added up.

Well, it’s abundantly clear now that employers aren’t cutting back on full-time workers. Here’s AEI’s Jim Pethokoukis:

Obamacare is not causing a surge in part-time employment at the expense of full-time jobs. Last month, according to the volatile household survey, full time employment was up 691,000, part-time employment down 594,000. So since last December, the economy has created about 1 million full-time jobs vs. a loss of 100,000 part-time jobs. From The Wall Street Journal: ”The uptick in part-time employment earlier this year now looks like a statistical blip: Part-time employment fell in late 2012, then rebounded in early 2013, and has now fallen for two consecutive months.”

That puts that rumor to bed. But don’t take this to mean that Obamacare won’t cause workers to cut back on employee hours. There’s a pretty good chance that it actually will have those harmful effects. But we won’t see those effects until a year from now when the threat of the employer mandate is closer.

It’s good that this job report disproved the idea that employers were cutting back worker hours because of Obamacare. But this shouldn’t overshadow the fact that the employer mandate isn’t good policy. We may not see the harmful effects of it now, but we likely will in the future.

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Chart of the Day: Obamacare More Popular

From Steve Benen, Obamacare’s popularity has risen in four different polls released this week:

polls.
I’m pretty confused why this is the case. Is it a backlash against Republicans for the government shutdown and debt ceiling brinksmanship? Maybe it simply reflects falling support for the Republican Party. Maybe from the Medicaid expansion? It’s surprising, given what a disaster the first couple weeks have been for HealthCare.gov. You wouldn’t expect the law’s popularity to be rising. Is this just a post-October 1st bump for Obamacare before the media began covering HealthCare.gov’s many major problems? Will support crater as the public hears more about it? I have no idea, but it’s an interesting and surprising dynamic.

 

Could Obamacare’s Failure Lead to Single Payer?

Ezra Klein and Ross Douthat have both written pieces recently arguing that the failure of the Affordable Care Act could lead towards a more liberal form of universal health care. The idea goes that if HealthCare.gov doesn’t become feasible, people will begin looking at which parts of the law were successful and which weren’t. The Medicaid expansion has thus far been a success in the states that have expanded. Government-run online marketplaces? Not so much. That’s a problem for conservatives, because many of their leading health care plans would require those online marketplaces. If those are deemed a failure, what’s their next proposal? Meanwhile, the liberal fantasy – Medicare for all – is much closer to the Medicaid expansion. The appetite for universal healthcare would still exist and now single payer would be the clear solution. Klein and Douthat both see this as a distinct possibility. Is it?

There are a couple of reasons to be skeptical.

First, if Obamacare fails, it’s going to hurt Democrats badly. Time and time again House and Senate Democrats have thwarted government opposition to Obamacare. They’ve refused to defund or delay the law or the individual mandate. Republicans, of course, have done the opposite. If the exchanges don’t work, Republicans will earn major points with voters. This has been the leading battle for years now. Democratic candidates will have a lot of trouble fighting off attacks that they stuck with a partisan, unpopular law only to watch it collapse under its own weight once enrollment began. Like Klein, I don’t believe many things affect elections. This would.

Second, Klein and Douthat’s argument assume that Americans will be able to distill HealthCare.gov’s failure from the other parts of the law. Will they understand that the Medicaid expansion succeeded while the complex public-private partnership that created the exchanges failed? It’s not clear. Klein is one of the leading proponents that Americans don’t follow politics closely. They don’t know what’s going on in D.C. Obamacare’s failure would be a big story. But would it be big enough for people understand the causes of it? The CBO projects that only seven million people will sign-up on the exchanges next year. They will all undoubtedly see the website’s issues, but the vast majority of people will never try to login to HeathCare.gov. They may hear that Obamacare failed without knowing the causes.

Third, many Americans may see Obamacare’s failure as symbolic of government’s inability to regulate the health care market. Whatever the causes, Americans may conclude that getting government involved in the health insurance industry is a bad idea. They won’t spend much time thinking about why Obamacare failed and simply decide that enough government disruptions in the health care market.

Klein and Douthat’s argument is not impossible. Maybe Americans will be clamoring for single payer if the exchanges fail. But there are also a number of reasons why that won’t be the case. Klein and Douthat give Americans a lot of credit for understanding the root causes of Obamacare’s failure, evaluating the competing conservative and liberal health care ideas and using the Obamacare analysis to guide their decision-making. I believe most Americans will think more simplistically and see Obama’s failed law as nothing more than a failed program epitomizing the government’s inability to regulate the health care market. Let’s hope that the administration can get the exchanges working and we never have to find out.