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Published June 24 2010

Forum editorial: Health law could stall recovery

The health care reform seminar conducted Tuesday in Fargo answered a few questions but did not dispel the foremost concern that most worries businesses: uncertainty. Implementation of the sweeping health care reform has yet to begin, but the uncertainty of how regulations will affect health care insurance plans, medical practice and the ability of business to provide health insurance for employees is threatening to stall economic recovery.

Employers who don’t know what their costs will be because of reform will not invest in expansion, will not hire more workers, will not purchase more inventory than they need.

In other words, at this point the health care reform law is shaping up to be a jobs killer. Some convincing analyses suggest that it will be more of a drag on the economy as its provisions kick in over the next few years.

That’s not to say elements of the law are unwelcome. For example, health care providers in North Dakota like the “frontier amendment,” which increases Medicare payments to hospitals. Surveys confirm most people like extension of health insurance coverage to the uninsured. They also like preventing insurers from blocking or dropping insurance for children with pre-existing conditions. Ending the limits for lifetime essential insurance benefits also wins favor.

But other parts of the law are worrisome, not only for businesses that provide health insurance to workers, but also for anyone concerned with the economic sustainability of the health care system. The major health insurer in North Dakota might have to raise employer group coverage costs 15 to 30 percent. It’s “a certain amount of guesswork,” said Paul von Ebers, president and chief executive officer of Blue Cross Blue Shield. Again, it’s the uncertainty that makes employers and employees nervous.

The great failure of the new reform is it does not tackle health care inflation. Health care is 17 percent of the economy, yet the new law does little to fix the cost side, said Ross Manson, a health care consultant with Eide Bailly, a Fargo-based accounting firm. Again, uncertainty emerges as the only certainly in the maze of reform.

No one argues with the need for health care and health insurance reform. The new law includes changes most Americans can embrace. But uncertainty for business and the frightening prospect of even higher costs for medical care and insurance add up to a drag on an economy struggling to emerge from recession.

Forum editorials represent the opinion of Forum

management and the newspaper’s Editorial Board.