Health care ruling might provide guidance for businesses

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LOS ANGELES -- To the surprise of many economists, Thursday's Supreme Court decision on the Affordable Care Act doesn't further confuse what's going to happen next.

That clarity might help businesses finally make some personnel and other moves, giving the economy a much-needed kick and President Barack Obama one more thing to brag about, economists say.

"There is a perspective on the economy which is argued that laws of regulation have imposed a lot of uncertainty on businesses," said Gerry Wedig, an economist with the University of Rochester's Simon School of Business. "Now, there is a lot more certainty about what the rules are going to be. That might allow firms to move forward with their plans."

That includes hiring health care personnel to meet the increase in demand sure to come with increased preventive care, said San Diego State University economist Dan Seiver.

And jobs are the one thing that Mr. Obama needs right now, given the economy's lackluster performance -- something that was underscored by Thursday's report that the nation's first-quarter GDP growth was slow, as expected.

The decision will also increase demand for schools providing health care worker training, he said.

"There's going to be a huge increase in demand for all kinds of medical services," Mr. Seiver said. "That's a good thing and a bad thing. A lot more people are going to get preventive care, but there will be costs."

Those costs are what motivated the National Federation of Independent Business to join states in the lawsuit against the Affordable Care Act.

Other business groups, including the U.S. Chamber of Commerce, continue to oppose the ruling, while the Small Business Majority lauded it as a first step to increasing choices for workers.

Under the law, "small-business owners are going to face an onslaught of taxes and mandates, resulting in job loss and closed businesses," Dan Danner, president and CEO of the National Federation of Independent Business, said in a statement.

Businesses with more than 50 employees will, starting in 2014, have to provide insurance for employees or pay a penalty, Rochester's Mr. Wedig said.

That will increase their costs, which they will likely pass along to employees. But that's not until 2014.

Until then, the reduction in uncertainty and demand for jobs could be one more boon for the president.

businessnews - health

First Published June 29, 2012 12:00 AM


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