Another casualty of soaring health costs: jobs
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Rising health care prices have measurably increased unemployment in the United States, according to a new study in the National Bureau of Economic Research.
Why it matters: Surging health care costs don't just hit Americans in their pocketbooks — they could be costing them jobs, especially for middle-income workers.
The big picture: Most people with health insurance are covered through an employer. That system creates a "direct link" between health care prices and labor market dynamics outside of the health sector, the researchers said.
- As health care prices rise, so do the costs to employers providing health insurance.
- But the impacts are felt more broadly among workers. Previous research has found that growing health care costs have also stifled their wages.
The new research found that a 1% increase in health care prices lowers an employer's headcount by about 0.4%.
- These job losses are concentrated among people earning less than $100,000, contributing to inequality, the researchers said.
- For the average county, a 1% increase in health care prices reduces aggregate income by approximately $8 million annually.
What they're saying: "It's vital to understand that rising health care prices aren't just impacting patients. Rising prices are hurting the employment outcomes for workers who never went to the hospital," said co-author Zarek Brot-Goldberg, an assistant professor at the University of Chicago.
Zoom out: The researchers used hospital mergers to analyze the broader impacts of price increases.
- Their previous work found hospital mergers over the last two decades —that federal regulators could have challenged but didn't — increased prices 5% on average.
