Side Effects: Obamacare Hurts Low-Income Workers

Kathryn Nix / October 21, 2010

With a struggling economy and stagnant unemployment rate, the last thing the United States needs is any public policy that will hurt job growth. Unfortunately, Obamacare’s new federally mandated, essential benefits package will diminish new job opportunities, especially for low-income workers.

This is expected to occur because the new law requires employers to offer health care coverage or pay a penalty. And they can’t offer basic health plans. Instead, all job-based health plans must include what the government determines to be “essential benefits.” Since benefits that employers provide to their work force mark a dollar-for-dollar reduction in cash wages, more benefits in these government-mandated plans will mean less available income for salaries or new jobs. Inevitably, this provision will further drive up the health care costs for businesses, forcing them to hold back on new hiring and investments. (more…)