There’s an interesting angle to the state health insurance exchanges that hasn’t been talked about much, at least around here. An article today in Business Insider points to its importance.
In the process of opening up access to health insurance through state-based exchanges and federal subsidies, new healthcare reform provisions shift power from employers to employees by freeing some people from “job lock.”
Whereas employees might turn down job opportunities or put off starting a business for fear of going without health insurance, Obamacare health insurance could change that by offering workers a new safety net. This is especially true for people with chronic conditions, as healthcare reform provisions prohibit insurers from turning away people with pre-existing conditions and establish minimum coverage standards.
The Urban Institute has predicted that 1.5 million more people will become self-employed by 2014.
While advocates say state exchanges will make it easier for workers to change jobs at will, there are of course two sides to every story. Mainstream media is littered with reports of companies cutting full-time positions down to part time to avoid health insurance requirements, or declining hiring all together so they can remain under the rules of “small businesses.”
BI puts it this way:
One of the key problems with Obamacare’s design is that it tries to simultaneously get health insurance to lots of people who don’t have it while discouraging employers from dropping the (very expensive) plans they currently offer. Once we have separated the availability of health insurance from employment, it is likely to prove untenable to expect employers to keep offering it. That shift will be a mixed bag for employers: They’ll be relieved of rising health insurance costs, but they’ll have to pay added taxes and they’ll lose power over their employees. But for workers, the added freedom should be mostly positive.
That freedom could play out in different ways, even for those who keep their jobs. A recent analysis by researchers at Stanford School of Medicine estimated that 37 million people would be financially better off switching from employer-based insurance to the exchange, so we may see a shift away from employer-based insurance to state-based exchanges.
BI also writes that early retirement could become more prevalent, as the ACA would make it easier for retirees under 65 to get their own health coverage.
Remember that fiction writer, John Green, I wrote about this morning? He’s got another great informational video on this topic in which he explains how the changes could be a boon for entrepreneurship. In a nutshell, he says: “Career decisions should be about finding the place where your talents meet the world’s needs, not about finding the place where you can get health insurance.”