Affordable Care Act hits home

GV professors' study shows 1,000 jobs lost in West Michigan

By Carly Simpson | 1/22/14 12:58pm

A recent report of West Michigan businesses found that 1,000 jobs have been lost due to the Affordable Care Act.

The report, released Jan. 15, was done by Grand Valley State University economics professors Leslie Muller and Paul Isely, GVSU student Adelin Levin, and Priority Health. It surveyed 174 area employers in Kent, Ottawa, Muskegon and Allegan counties.

“We had heard anecdotal evidence of firms cutting hours of part-time employees to keep them under the 30-hour full-time threshold put into place by the Affordable Care Act,” Muller said. “We had also heard about firms increasing health insurance costs for their workers. But anecdotal evidence is not enough; we wanted to do a random-sample study of West Michigan employers and see what is actually happening.”

According to the report, 93 percent of firms in West Michigan with more than 50 employees currently have health insurance for their workers. However, this percentage is likely to decrease.

While 89 percent of the firms plan to offer insurance in 2014, the rate goes down to 66 percent by 2015, which is when the ACA Employer Mandate kicks in.

In addition, firms are facing a lot of uncertainty in what the ACA will bring and because of this are decreasing hiring and cutting part-time hours, said Muller.

Report’s findings on changes to hiring:

  • 15% of firms have increased the use of temporary workers
  • 22% plan on reducing or limiting hiring
  • 29% have limited employee hours
The health care debate is complex and often ignored by students. However, Muller said students need to educate themselves on the topics of health care and health insurance.

“There are many future business owners in our student body who will soon have to navigate the world of health insurance,” she said. “It is an expense that cannot be ignored when running a business.”

Cynthia McCurren, the dean of Kirkhof College of Nursing, agreed that students need to educate themselves about health insurance for another reason.

“Poor health may be the last thing on the minds of young, healthy college students,” McCurren said. “They often believe their youth equates with being invincible. No one plans to get sick or hurt, but no one knows when they may need medical care. Health insurance covers costs associated with this care and protects one from very high expenses.”

McCurren said it is important to realize the catastrophic impact hospital visits and prescriptions can have on a limited budget if students don’t have insurance stating that the average cost of a three day hospital stay is $30,000.

McCurren listed monthly expenses of common drugs without insurance coverage:

  • Birth control pills: $112
  • Adderall: $210
  • Asthma inhaler: $60
“This knowledge provides a perspective on how important health insurance is — for everyone,” McCurren said.

The average premium for individual coverage in 2011 was $183 per month, she said.

“But as a college student, why should you worry today?” McCurren asked. “You may be covered by your parent’s health insurance. How you will afford health insurance when you reach the age of 26 should concern you. Policies being made now will be policies that will affect you in the future.”

She added that “each of us needs to realize the unexpected can happen.”

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