The initial economic impacts of the health care decision
Dr. Gregory Coleman, Assistant Professor of Medicine, University of Miami, Miller School of Medicine, speaks with Vanessa Moreno, 25 years old, as she visits him for a check-up on the same day that the United States Supreme Court upheld the Affordable Care Act on June 28, 2012 in Miami, Fla.
Jeremy Hobson: Now let's get to the healthcare ruling from the Supreme Court and what it means for the economy.
Chris Low is chief economist with FTN Financial. He's with us live this morning. Good morning.
Chris Low: Good morning.
Hobson: Well Chris, just on balance as an economist looking at this -- what do you think? What does this mean?
Low: Look, on balance, what I think is maybe the most important thing is that we're looking at some fairly significant tax increases -- almost $700 billion -- which go into effect in January of next year. And then we're going to have some offsetting benefits, obviously, that kick in, in the form of health coverage. But those don't go into effect for two years, so now, it's a drag on the economy.
Hobson: Well I know that some businesses are worried because they are now going to have to cover workers if they have more than 50 full time employees. What about that?
Low: That's right, you know. And it's funny because France has regulations which are pretty expensive to comply with, which also apply to businesses with more than 50 employees, and as a result most companies in France -- well the largest number anyway -- are sitting at 49. So that's an element; and that's why it was the small business groups who were suing in the case that actually went to the Supreme Court and was decided yesterday.
However, one of the things that's going to affect their compliance and what they have to do is how the rules are actually put into place by Health and Human Services. They write the regulations, and most of those regulations are not written yet.
Hobson: Chris Low, chief economist with FTN Financial, thanks as always.
Low: You're welcome, thank you.