How The Health Care Law Could Spur New Businesses http://t.co/F7TUvhE1qv
— ATC on NHPR (@NHPRATC) March 12, 2014
I have long argued that one advantage of a universal health care system is that it would help both entrepreneurs and those in creative fields (like bloggers!) because it would separate health coverage from corporate or bureaucratic employment. In doing so, it would allow entrepreneurs, inventors, and artists to more easily break from traditional employment and focus on their own ventures.
After all, as I think the late economist Joseph Schumpeter would argue, it is entrepreneurship, and not large corporations, which bring about the positive fruits of markets economies. Indeed, established corporations often have reasons to thwart entrepreneurial ventures which they view as a threat.
While Obamacare stops short of a single-payer-type system, NPR reports that it may already be helping entrepreneurs venture out.
“Entrepreneur lock has proven to be a significant barrier to potential entrepreneurs,” says Dane Stangler, vice president of research and policy at the Kauffman Foundation, which promotes entrepreneurship.
“To the extent the Affordable Care Act unlocks that job lock — that entrepreneur lock — one effect is to provide a boost to entrepreneurship overall,” Stangler says.
The U.S. system of employer-provided health care deterred people from quitting a job to start their own business, says Susan Gates, one of the authors of a study by the Rand Corporation in 2011.
“People considering leaving a job with good health insurance faced a daunting challenge in purchasing health insurance on the individual market,” Gates says.
The study concluded that this particular challenge was reducing the number of entrepreneurs. The study also calculated that making health insurance more accessible and affordable in the individual market could increase self-employment and entrepreneurship by a third.
“There’s no question that the health exchanges provide a set of opportunities that didn’t previously exist,” Gates says.
Stangler believes the ACA could help boost employment by creating somewhere around 25,000 additional new businesses each year. He’s not overly concerned that the employer mandate for companies with 50 or more workers might hurt entrepreneurship: Few companies ever get that big, he says.
As the Affordable Care Act continues to roll out, the focus must be on how to get closer to the goal of universal healthcare coverage. Partisan bickering and partisan cheerleading are not going to get us there.