Report: Obama health care plan would be good for California's economy

President Obama Signs Health Care Reform Bill

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File: President Barack Obama arrives for a signing ceremony of the Affordable Health Care for America Act with fellow Democrats in the East Room of the White House March 23, 2010 in Washington, DC.

A newly released study by the Bay Area Council Economic Institute (BACEI) contradicts claims that health care reform will hurt California’s economy. The report, released Sunday, suggests the federal Affordable Care Act will create tens of thousands of jobs in the Golden State — and mostly in Southern California.

The 28-page report by BACEI, a public-private organization that advocates for businesses, considered each provision of the Affordable Care Act and measured its potential effect on California’s economy. The study concludes that for the year 2010, had the health care reform law been in place, it would have generated nearly 100,000 new jobs in California and it would have injected more than $4 billion into the state’s economy.

"That is perhaps surprising to a lot of folks in the public debate where the affordable care act is sometimes called 'job-killing.' But there’s no evidence for those claims," said Micah Weinberg, a senior fellow with BACEI and co-author of the report. Among the issues he examined: the expansion of Medicaid coverage to poor Californians, the effect of the law's tax credit on small businesses and the ways consumer spending might be affected by the individual — that controversial provision in the law that would require all U.S. citizens to purchase medical insurance.

"A lot of proponents of the bill will point to only the good parts; a lot of critics will only point to the bad parts. We looked at everything we could possibly throw in there, positive and negative, and on net it’s very positive," Weinberg said.

The report predicts the effects of health reform would vary widely throughout California. For instance, while it indicates that the Southland would win about 60 percent of the new jobs and experience a $3 billion economic expansion, the San Francisco Bay area wouldn't fare as well. It would gain only about 8,000 jobs and would suffer a $4 million economic loss.

Statewide, the biggest per-capita employment gains turn up in Sacramento, and that concerns John Graham. He's a health care economist with the San Francisco-based Pacific Research Institute, which advocates for less government.

"How many of these jobs they expect are not going to be delivering health care to patients but are going to be bureaucrats working in the state government or in the county government complying with federal regulations?" he asked.

Weinberg said the ultimate financial and policy impacts of federal health care reform will rely on how the public and private sector implement the new policies and on how much of the law the U.S. Supreme Court upholds when it rules on the matter sometime before the end of June.

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