As key provisions of the Patient Protection and Affordable Care Act take effect next year, economists will be looking at more than just how it influences costs.
The law forces uninsured people to either buy insurance or pay additional taxes, and for some, individual rates will no doubt rise. Critics have wondered aloud whether PPACA will reduce employee work hours, drain earnings, or if it will cause fast-growing small businesses to slam the brakes on hiring as they near the threshold 50th full-time employee.
The ultimate question in 2014 will be whether billions of dollars will be diverted from the general economy to the feds and carriers — dollars that otherwise might be spent on homes, vehicles, appliances and other big-ticket items.
More pointedly: Will Obamacare cause another Great Recession?
Economists and health care experts agree it's too early to tell what the rollout of the exchanges and the individual mandate will mean for the economy. But one early indication that a recession is unlikely, they say, is that part-time work isn't expected to increase as a result of health care reform.
During the past two recessions, part-time employment rose, but such employment was either flat or falling after the end of the recessions. The employer mandate, which requires employers to provide insurance to those working more than 30 hours a week, does not take effect for another year – and there's no reason why anticipation of it should increase part-time employment in the meantime, according to a report by the Washington-based Economic Policy Institute. Such part-time employment has been falling since Obamacare's passage.
A small survey by the Federal Reserve Bank of Minneapolis in March found that only 4 percent of companies had shifted to more part-time workers in response to health reform.
Likewise, the Center on Budget and Policy Priorities released a similar study, saying the latest data provides scant evidence that PPACA is causing a significant shift toward part-time work.
"Many part-time workers have already gotten sponsored insurance, even without a mandate—maybe not necessarily at the bottom of wage distribution, but generally, large firms will offer this to all of their workforce and there is no sign that will change," said Elise Gould, director of EPI's health policy research.
The unsustainable rate of health care cost growth — that is, that spending's growing faster than GDP and eating up budgets — is an area that might be raising concern for the overall economy, said Ceci Connolly, managing director of PricewaterhouseCooper's Health Research Institute.
The first thing to consider, she said, is that there are aspects of PPACA that slow the inflation of health costs.
"First, when looking at the penalty for hospital readmissions, we're seeing health systems taking action to reduce hospital readmissions because they're costly and often either unnecessary or preventable," Connolly said. "We believe that in 2014, that will continue in a significant way. Meanwhile, incentives and penalties within the new law to pay for value instead of volume are also starting to bring us savings. That can be seen particularly in bundled payments and accountable care."
