Economy

Obamacare Repeal Is Causing Widespread Hospital Layoffs, 80 Hospitals Have Closed

 

In the face of a major overhaul of the U.S. health care system, hospitals are cutting back on new hires.

Obamacare supporters claim that millions of Americans will lose health insurance if lawmakers pass the Republican plan to “repeal and replace” former President Barack Obama’s landmark health care legislation. The Congressional Budget Office, a nonpartisan research entity, predicts that some 18 million would lose health coverage within the first year of the enactment of the American Health Care Act.

Expecting massive drop offs in the number of insured Americans, hospitals are faced with the difficult decision of what to do with increasingly expensive staff, Axios reports.

Obamacare vastly expanded Medicaid to extend coverage to low-income individuals and provided subsidies for individuals 400 percent below the poverty line. The Medicaid expansion program dropped the number of uninsured Americans by 13 million in 2015, just one year after Obamacare took full effect. To keep up with the flow of new consumers, hospital systems hired more workers.

If millions of people lose coverage and, as a result, stop purchasing health care services, hospitals will be left with a hefty bill. Average hourly earnings for all employees across the health care and social assistance sectors increased by over 20 percent from 2007 to 2017, the Bureau of Labor Statistics reports. Non-profit hospital systems saw employee compensation grow between 7 and 10 percent in 2016 alone.

Rural hospitals are reportedly the most concerned about the GOP repeal platform. Under Obamacare, hospitals in rural counties have already taken a serious hit. Since the legislation rolled out in 2010, 80 rural hospitals have closed up shop, and experts predict that 25 percent of all rural hospitals in America will close their doors by 2020.

Researchers expect that any changes to hospital revenue streams, especially in rural counties, could force more hospital systems to lay off workers or shut down completely.

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