In its latest U.S. fiscal outlook, the nonpartisan CBO said the health law would lead some workers, particularly those with lower incomes, to limit their hours to avoid losing federal subsidies that Obamacare provides to help pay for health insurance and other healthcare costs.
White House officials characterized reduced hours as a reflection of new choices for workers. CBO officials pointed to older workers as one example, saying some nearing retirement could decide to keep their work hours shorter to maintain healthcare subsidies until they qualified for Medicare.
But the report also referred to healthcare subsidies in less upbeat terms, saying assistance would "reduce incentives to work" and pose an "implicit tax on working" for those returning to a job with health insurance.
The biggest impact would begin in 2017, CBO said, because major provisions of the law, including an expansion of the Medicaid program for the poor in half of the 50 U.S. states, will be well under way by then. The CBO said there would be smaller declines in work hours that would occur before then.
Work hours would be reduced by the equivalent of 2.5 million jobs in 2024, said the agency, which earlier predicted 800,000 fewer full-time jobs by 2021. The bottom line would be a slower rate of growth for employment and compensation in the coming decade, according to the report.
