Will Health Care Reform Result in Job Loss?

According to the Urban Institute’s recent evaluation of Massachusetts’ universal health care reform initiative, the answer is no. Economic theory suggests, among other things, that when employers are required to provide health insurance coverage, they will reduce wages and other worker compensation over time in order to pay for these new costs. If collective bargaining agreements prohibit this, employers may instead demand less labor, causing an employment reduction. But, researchers found employment trends in Massachusetts immediately after health care reform was implemented in 2006 and during the subsequent economic recession closely resembled those of states with similar employment patterns to Massachusetts before health care reform.