Considering all the spin on the subject coming from the newly-elected Republican majority in the House of Representatives, and other conservatives, it might surprise many people to learn that the health care reform act of 2010 will actually increase the freedom of the typical American, and strengthen the U.S. economy.

But unless one of the conservatives' unlikely last-ditch efforts to de-fund the law or otherwise prevent its implementation succeeds, three key health reforms will take effect on Jan. 1, 2014, that will benefit individuals and the economy alike:

1. Subsidies, in the form of refundable tax credits, will cap maximum "out of pocket" expenses for lower income Americans.
2. Health plans will no longer be able to exclude people due to pre-existing conditions.
3. State health insurance exchanges for small businesses and individuals will open.

If the health care law is not undermined, it will remain the biggest social policy advance in the United States since the passage of Medicare in 1965, and it would rank third behind the latter and the establishment of Social Security of 1935 in terms of social safety net significance.

Will Benefits Portability Advance Careers?

Those three reforms alone will clearly help many individuals, but what may be less obvious is how they will boost the economy as a whole. That's because its easy to overlook the impact health care reform will have on job mobility via benefits portability.

Right now, millions of people are remaining in their jobs, not because they really want to, but because of their health care coverage. In some cases, their plans provide vital health care for a spouse or dependent. In others, employees know that changing jobs could jeopardize their own coverage and benefits. So they stay put.

True, mobility also declines cyclically during recessions -- and that's especially been the case during the Great Recession, which increased the nation's job shortage from 7 million jobs to about 14.8 million. But the health care insurance factor has been an impediment to job mobility in the United States for decades.

The new health care law eliminates a great deal of the "coverage risk." Exit health care impediment. Enter increased job mobility. Employees seeking promotions, career changes, or better work environments will be able to make those changes more easily, instead of remaining in their current companies simply to retain health benefits. And that will lead to a more efficient allocation of talent in the U.S. economy.

Benefits Portability: Good for Employees, Economy


Further, the new system will stimulate business formation, innovation, and U.S. GDP growth. Consider these hypothetical (but realistic) examples:

• An advertising account executive wants to start a new Internet marketing solutions company, but he doesn't, for fear that the shift will prevent his wife, who has a serious pre-existing condition, from continuing to receive health insurance. Under the reformed health care system, he'll be able to start that new company, because he'll be able to purchase insurance for his wife under whatever plan he chooses. The law will require it. Add another job-generating small business to the economy.

• A 20-something wants to head back to graduate school to earn an advanced engineering degree, but she doesn't, due to concerns about obtaining affordable health insurance while she's unemployed. As a result of the new health care law, she'll be able to enter grad school confident in the knowledge that, thanks to federal subsidies, she'll be able to obtain affordable health care coverage. Add another highly-skilled scientist to America's innovation machine.

• A married auto mechanic likes working for his current employer, a large auto repair shop near a big city, 45 miles from his home. But he thinks a better fit for him would be a smaller repair shop nearer to his small home town, and the shorter commute would give him more time with his family. However, he doesn't accept a job offer at the smaller shop because he's concerned about its ability to maintain health insurance. Thanks to the new health care law, he'll be able to take the job closer to home, because health care costs will be more affordable for small businesses under the new system. His quality of life goes up, and the money he spends on gas for his commute goes down.

Health Care Insurance: A Factor in U.S. Job Search

Obviously, health care insurance isn't the only factor people consider when making career decisions, but it can be a major one.
The U.S. is far behind Europe on benefits portability, and any time portability increases, it enhances the ability of talent to seek its best use.

Business formation. Innovation. Americans going back to school to increase their skills or enter a field they believe is their calling. Talent seeking its highest and best use. All of these are good things from an economic value-added standpoint and add to GDP growth, which makes the new health care law good news for investors.

The downside, of course, is that it will take until 2014 until benefits portability really starts to rev up. That's a considerable time away, and one reason many progressive public policy analysts view the 2010 health care law as too modest. That's my view as well: The 2010 act didn't go far enough. Congress did not create a single-payer system, nor something even more revolutionary, like a system in which the health care people receive is determined by how sick they are, not by whether or not they have insurance.

But this isn't France or Sweden -- you're living in the United States, and, to paraphrase Sen. Bernie Sanders (I-Vt.), when the votes aren't there, you take what you can get.

And what we got, imperfect though it may be, will provide real benefits to the U.S. economy.

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jerrym930

The 3 items listed as individual benefits in the article could all have been implemented without having this monstrousity of a bill, that forces free people to buy health insurance. I find it rather hypocritical of Democrats to say they support the right of a woman to have an abortion, and kill an unborn child, but yet not allow people the right to say they did not want to buy health insurance. Democrats are the most hypocritical people ever to walk the face of the earth.

March 20 2011 at 9:39 AM Report abuse -1 rate up rate down Reply
valdemint

I don't like Lazzaro's position on Obama Care, How about having some opposing views once in a while. His mind is made up and he doesn't want to be confused by any facts. Like how adding 30 million to Medicaid is going to save money and how that will be paid for by cutting Medicare or rationing. And no matter how wonderful it is by allowing pre-existing conditions to be paid for it will up the costs, no matter what! It may be desirable but lets say how it will be paid for. I don't like the left wing slant of AOL. What other ISP can I use? POSH

March 19 2011 at 1:21 PM Report abuse +1 rate up rate down Reply
inasctg56

Just reported by Daily Finance: "A key gauge of the health of the manufacturing sector, the index posted its fastest expansion since 1984." All thanks to an administration who is workng with our manufacturing sector and trading partners negotiating better trade deals as the $45 billion new agreement with China. Also South Korea and now South America. For every 10% gain in exports, we gain 7% job growth. We have had 19 months of manufacturing gains and exports have had double digit gains. The dems policies work for american workers. The gop's works for corporations to make record proftis overseas. End of story.

March 19 2011 at 1:07 PM Report abuse rate up rate down Reply
inasctg56

Fidelity just reported that health insurer costs declined for the first time in ten years yet our premiums do not go down - it just means bigger profits for corporations as usual. The healthcare bill when fully enacted addresses increases in premiums compared to costs. So if you still want to do away with it, you're only shooting yourselves in the foot.

March 19 2011 at 1:54 AM Report abuse rate up rate down Reply
scottee

I'd like congress to consider the Physicians for a National Health Program....pnhp.org....look it up online and read the details. it's a better alternative to obamacare or doing nothing.

March 18 2011 at 8:17 PM Report abuse +2 rate up rate down Reply
gpfs

Some states require employers to provide health care and some don't. This is a state issue not a Federal issue. The health care law is part of a step process to single payor. Socialized. If you want that, just move up to Canada, they love it until they need surgery or treatment for a serious condition and go on a waiting list. With $45 - $85 billion in waste and fraud in Medicare, that should tell you how effective government programs are! Wait until your state finds out what the Medicad costs are going to be and raises your taxes. America has to hope the Supreme Court rules it unconstitutional!

March 17 2011 at 10:09 PM Report abuse rate up rate down Reply
1 reply to gpfs's comment
scottee

what about the private sector??? how many still offer health care plans???

March 18 2011 at 8:17 PM Report abuse +1 rate up rate down Reply
Brian and Pam

Very Foolish assumptions in this article. Health Care reform will not strengthen nor improve the economy; only hurt it. This is a very poorly written article and a shame on AOl and the writer.

March 17 2011 at 8:05 PM Report abuse +1 rate up rate down Reply
hayleytn

I THOUGHT THE PORTABLE PART MEANT YOU TAKE YOUR POLICY WITH YOU. I WAS TOTALLY CONFUSED IN READING THE EXAMPLES. ESPECIALLY THE STUDENT. AREN'T YOU AUTOMATICALLY COVERED IF YOU ARE IN SCHOOL. GRAD SCHOOL UNDERGRAD WHATEVER!! I WAS UNDER THE IMPRESSION THAT AN INSURANCE POLICY WAS ESSENTIALLY A SAVINGS ACCOUNT ANYWAY.YOU TAKE YOUR MONEY AND THE POLICY IF IT IS A SOUND ONE WITH YOU. I GUESS YOU JUST NEED TO FIND AN ADMINISTRATOR OR LEARN ABOUT INSURANCE BILLING POLICIES

March 17 2011 at 6:07 PM Report abuse -1 rate up rate down Reply
1 reply to hayleytn's comment
Bridget

I suggest that you learn more about the policy that your covered by as your post insuates. It's always a good thing to know about your healthcare insurance coverage. I worked in a large NYC Hospital for 32 years ( verifying patient's benefits) and was amazed at how many people didn't know anything about their coverage until they needed to used it. They would receive their insurance card and booklets explaining benefits, which they rarely read, and assumed that everything was covered. It never occurred to them that they needed to be aware of the benefits (deductibles and/or co-pays) until they needed the coverage.

March 17 2011 at 6:36 PM Report abuse +3 rate up rate down Reply
MY LORD

More AOL liberal Obama worship. Obamacare doesnt do anything new in portablity that COBRA didnt already do. Obamacare will kill our economy not strengthen it

March 17 2011 at 6:07 PM Report abuse +1 rate up rate down Reply
rogersstudley

Well here we go again. The left wing leaning of this site always says what the demo's want. The american people spoke in nov 2010 they don't want the health care that the demo's have shoved down our --------. The tide is turning like in wisconson that is just the start. We hard working people are tired of this give me by the left .

March 17 2011 at 6:07 PM Report abuse rate up rate down Reply