Could Efforts to Repeal Obamacare be Stunting Healthcare Jobs Growth?

by webadmin on August 16, 2013

BAC-thumb1The healthcare employment boom, prevalent for the last two decades, has abruptly hit a plateau in 2013, Danielle Kurtzleben reports over at U.S. News & World Report.

“The recent July jobs data showed that healthcare only added 2,500 jobs, its lowest monthly total in 10 years. July 2003 was the previous low, and it was also the only negative month for the industry over the span of available data from the Labor Department, which stretches back to 1990.”

July was simply a continuation of a trend that has plagued healthcare in 2013: where healthcare was averaging 19,800 new jobs a month in 2011 and 26,700 in 2012, 2013 has seen only 15,700 new jobs per month, giving the industry its “lowest average monthly growth in healthcare employment since 1999, when average monthly growth was 12,000.”

Reading this, your first thought might be, “Aha! The crappy economy has finally caught up to healthcare.” (Or some variation on that thought.)

And you might be right, Patrick O’Keefe, director of economic research at accounting firm CohnReznick, speculates; after all, high unemployment has led to a decline in employer-provided healthcare, which has led to people skipping out on appointments.

He explained, “In the health industry, probably the most immediate reason for a slowing in the pace of growth is the cost squeeze that the industry is facing. Household incomes are and have been flat for a long time, which impinges on spending, including health spending.”

But.

There’s more, Kurtzleben writes, and this is where things get intriguing. Healthcare reform’s quest for efficiency could also be contributing to the slowdown in growth. According to O’Keefe, “If the healthcare industry is getting more efficient – treating the same number of patients with fewer people – that could also account for a flattening growth curve.”

This isn’t necessarily a bad factor, since healthcare employees are concurrently seeing pay increases above and beyond the private sector. On top of all this, it should be noted that most industries outside of healthcare are expected to grow in late 2013 and early 2014, according to Douglas Handler, chief U.S. economist at IHS Global Insight.

However, Handler throws the following idea into the ring, one that reflects the political temperament of our age: the ongoing quest to repeal Obamacare.

Handler wonders if many healthcare organizations are purposely slowing down the hiring process since the political situation in Washington is so volatile.

“I think there’s a lot of anxiety out there the act might be repealed. It’s certainly creating a lot of uncertainty, which impedes companies’ planning and therefore the healthcare sector’s planning as well… If we can get rid of all that uncertainty and really start focusing on the implementation of that, I think it could be positive for healthcare employment.”

As healthcare executives, how much does the political fallout from Obamacare’s passage affect your future planning and your current hiring? Do ongoing efforts to repeal Obamacare, originally thought to be squashed by the 2012 election, provide a sense of uncertainty in your efforts to implement reform? How does this impact your hiring practices?

-by Pete Fernbaugh

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