Fox News pushes GOP claim that health care reform “will kill 800,000 jobs”

Kelly: Republican senators “say the law will kill 800,000 jobs - perhaps more.” During the October 26 edition of Fox News' America Live, host Megyn Kelly reported on a “dire diagnosis by two Republican senators who are also doctors on the impact of the new health care law.” Kelly noted that “they say the law will kill 800,000 jobs - perhaps more.”

Bolling: “They estimate 800,000 jobs we are going to lose.” Fox Business host Eric Bolling appeared on America Live to discuss the Republican senators' report. He said, “I agree with them and these are doctors. They are Republican senators but they are doctors.” Bolling also noted, “They estimate 800,000 jobs we are going to lose because of what they found in the 3,200 pages.”

In fact, workers will choose to reduce their hours

GOP report cites CBO, which said health care reform will “reduc[e] the amount of labor that workers choose to supply” by “a small amount.” In their report, Coburn and Barasso claimed that health care reform will lead to “hundreds of thousands of jobs being lost.” They cited the following statement from a recent Congressional Budget Office report:

The Congressional Budget Office (CBO) estimates that the legislation, on net, will reduce the amount of labor used in the economy by a small amount--roughly half a percent--primarily by reducing the amount of labor that workers choose to supply.

According to Barasso and Coburn, “roughly half a percent” of the labor used in the economy “is more than 788,470 employees.”

CBO: People will work less because health care reform provisions increase their “financial resources.” In the report Coburn and Barasso cited, CBO further stated that the “reduction in the supply of labor is largely attributable to the substantial expansion of Medicaid and the provision of subsidies that will reduce the cost of insurance obtained through the newly created exchanges.” CBO explained that these measures “will effectively increase beneficiaries' financial resources. Those additional resources will encourage some people to work fewer hours or to withdraw from the labor market.”

Health expert Paul Van de Water: “If people voluntarily choose to reduce their hours of work ... that's not killing jobs.” Paul N. Van de Water, health care expert at the Center on Budget and Policy Priorities, told Media Matters via email:

The CBO report cited by Coburn and Barasso finds that health reform's major effect on employment will be a small reduction in the amount of labor that workers choose to supply. For example, some people with pre-existing health conditions may choose to retire earlier if they can obtain health insurance coverage through the new health insurance exchanges and no longer have to wait until age 65 for Medicare. If people voluntarily choose to reduce their hours of work, however, that's not killing jobs.

Harvard economist David Cutler: “People who are working solely to get health care” will “no longer need to do that.” Health economist and Harvard professor David Cutler, who also advised Obama's presidential campaign, told Media Matters via email:

There are several things wrong with this. First, the CBO noted that there were many effects in different directions. In fact, they are particularly conservative in their estimate of the cost savings to firms, which are a huge driver in employment. Second, most of the possible employment losses come from people who are working solely to get health care, who no longer need to do that. Why we need disabled people and people who would prefer to be home raising a family to instead be crammed into the work force is beyond me.

Fox forwards false claim that 80% of small businesses “could lose their health care plans”

Kelly reports claim that “80% of small businesses could lose their current health care plans.” During the segment, Kelly stated: “Senators Tom Coburn and John Barrasso saying 80% of small businesses could lose their current health care plans.” Also from the segment:

KELLY: Where are they getting this - the statistic that this bill will kill 800,000 jobs - perhaps even more and that 8 in 10 small businesses could lose their health care plans?

BOLLING: Here is how. Small businesses and we talked to a lot of small businesses, on the Business Network. Small businesses don't know how much this is going to cost them. They know that they are supposed to provide health care insurance for any new hires - they don't know how much that is going to cost. Right now they are seeing that their cost go up but there business may not be going up with the additional costs. So they say that we are not going to hire right now. We are going to see what this ends up costing down the road and what they are finding is that their costs are skyrocketing.

In fact, the figure refers to businesses that will change, not necessarily lose, their plans

GOP report cites federal regulation on how many plans will “relinquish their grandfathered status.” The introduction to the report from Coburn and Barrasso states that “in their estimate, the Administration predicts that eight in 10 small businesses could lose their current health plans.” Their claim is based on a June 17 rule published in the Federal Register that says 80 percent is the “high-end estimate” of how many small employer plans will “relinquish their grandfathered status.” A grandfathered plan is one that existed prior to the enactment of the health care reform law does not have to meet certain requirements that other plans must meet under the legislation.

Health Affairs: Relinquishing grandfathered status may be “a more attractive alternative” for some employers. Health Affairs' Timothy Jost explained on June 15 that “the primary way in which a plan will lose grandfathered status ... is if certain major changes are made in the plan to the disadvantage of enrollees.” If that happens, the government will require the plan to meet all of the requirements in the health care reform law in the interest of “protect[ing] Americans from being stuck in low value health plans as the coverage offered by those plans deteriorates.” Jost further wrote:

Smaller employers, which currently insure 43 million enrollees, may have to significantly increase coverage to comply with the essential benefit requirements in 2014, and may find grandfathered coverage more valuable. On the other hand, the absolute limits that the regulations impose on increasing cost sharing above medical inflation may be exhausted by 2014, making full compliance with PPACA, including the essential benefits, a more attractive alternative than continuing to live within the regulatory constraints. The agencies estimate that between 49% and 80% of small employer plans and between 34% and 64% of large employer plans will relinquish grandfathered status by 2013.

Van de Water: Workers “do not lose their health plan. In fact, they will receive additional protections guaranteed by health reform.” When asked if relinquishing grandfathered status is equivalent to “losing their health care plan,” Van de Water responded:

Health insurance plans that were already in existence when health reform was passed don't have to meet all the requirements of the new law (for example, the requirement to cover preventive services). These plans are called “grandfathered” plans. If an employer chooses to make significant changes to an existing health plan, however, the health plan loses its grandfathered status and must then comply with the new requirements. Since employers frequently make significant changes in health insurance benefits, cost sharing, or employer contributions, many existing health insurance plans are likely to give up their grandfathered status. Workers who are covered by plans that give up their grandfathered status, however, do not lose their health plan. In fact, they will receive additional protections guaranteed by health reform.

Cutler: Fox News' interpretation is “just plain wrong.” Cutler told Media Matters that Fox's characterization is “Just plain wrong.” He added, “Losing grandfather status is not the same thing as losing their health plan. Often, it means getting a better health plan - e.g., one that covers kids up to age 26.”

Fox News previously campaigned against health care reform

During the debate over health care reform, Fox News openly advocated against the Democrats' efforts. In addition to routinely misinforming viewers, Fox News hosts, reporters, and contributors announced their opposition to reform; urged viewers to tell congress members to “vote no”; pushed anti-reform protests; and solicited donations for ads opposing reform and for Republicans opposing pro-reform Democrats.