There is profound disagreement about healthcare reform's overall impact on jobs. One study conducted by the Center for American Progress indicates that four million new jobs will be created by health care reform in the next 10 years. However, a study conducted by the Heritage Foundation predicts the loss of 690,000 jobs. How could two estimates be so different?

In Pictures: 8 Great Companies With Top-Notch Healthcare Benefits

While the net effect on jobs remains uncertain, it is clear that certain professions will do better than others under healthcare reform. Three jobs likely to get a boost are presented below, along with a discussion of likely pitfalls to look out for in each profession. (Focusing on salary may be a mistake. Find out which benefits have the highest long-run payoff, read Job Hunting: Higher Pay Vs. Better Benefits.)

Insurance Agents
Insurance agents may get a boost since approximately 32 million uninsured Americans will be required to buy health insurance starting in 2014. Those who do not possess any form of health insurance will pay a $695 fine (or 2.5% on their income), providing a strong incentive to secure at least a minimum form of coverage.

On the other hand, insurance agents may lose out in some ways. First, new rules require health insurance companies to pay out at least 80% of their premiums (known as a loss ratio or combined ratio) for claims on individual and family insurance plans (and 85% in the employer/large group market). For example, if a company took in $100 million but only paid out $77 million as medical expenses, they would be required to reimburse $3 million to holders. This means that only 20% is left over to fund all other insurance company operating costs, including agent commissions. While agent commission can vary considerably, they generally run in the neighborhood of 10% to 15% of the first year's premiums, and then a reduced commission in the years to follow. With the new restriction, only 5-10% would be left for all other administrative costs including profit margins. Thus it appears likely that agent commissions may shrink as a result of the health reform law.

Second, new insurance exchanges will be set up to facilitate purchasing individual and family health insurance. While details are still murky, it appears that companies will be required to sell certain "minimum benefit" plans through these exchanges. The exchanges are meant to allow greater transparency of coverage, and facilitate consumer comparisons between plans. Thus, it might become easier for individuals to buy insurance without the help of an agent.

Certain doctors can look forward to increases in Medicare payments under the health reform law. According to the American Medical Association, family medicine, internal medicine, geriatric and pediatric physicians will be eligible for 10% incentive payments from 2011-2016 if they meet certain requirements. General surgeons operating in "health professional shortage" areas will also get the 10% incentive. In addition, Medicare payments for psychotherapy increased 5%. Under related legislation, certain payments under Medicaid were also increased.

While any increase in payments is likely to be well received, critics of these programs claim that payments remain far too low considering both the cost and the market value of many procedures. Often the amount paid to doctors by private insurance companies is far higher. In a growing trend, the Mayo Clinic branch in Glendale, Arizona stopped accepting Medicare patients as of January 1, 2010. The Mayo Clinic lost $840 million in 2009 on Medicare patients, spokeswoman Lynn Closway told Bloomberg News. Therefore, despite this payment increase, the fact that more Americans will become eligible for Medicare and Medicaid under the health reform law may be bad news for doctors' pocketbooks.

The somewhat unlikely winners in the health reform law may be entrepreneurs and other self-employed persons. Prior to the health reform law, larger group insurance plans provided by employers had a number of advantages over individuals attempting to buy health insurance on their own. Thus, the benefits of obtaining high quality health insurance through one's job could sometimes act as a considerable barrier for those who would consider entrepreneurship or other forms of self-employment.

Since many of the provisions in the health reform law aim towards leveling the playing field, allowing entrepreneurs to buy plans with greater transparency, and (in theory) at better rates through insurance exchanges. Entrepreneurs may be worse off, however, if they would have opted for low-cost "catastrophic" health insurance plans in order to minimize overhead in new ventures. Since the health reform law will require a minimum level of benefits from insurance plans sold through insurance exchanges, these types of plans may no longer be sold. (Don't let these simple errors leave you unprotected. Read 5 Mistakes That Can Ruin Your Life (Insurance).)

The Bottom Line
It is clear that due to a law that will spend $928 billion over the next decade some professions will fare better than others. Since there is so little agreement regarding this bill, you'll have to judge the debate for yourself. The net effect on many jobs will depend on how fine details of the new law are put into action. Things will change, but if you are in the right industry you could get more that just health benefits.

Still feeling uninformed? Catch up on your financial news by reading Water Cooler Finance: Everything Old Is News Again.

Related Articles
  1. Mutual Funds & ETFs

    Top 5 Health Mutual Funds

    Learn about the top five mutual funds that invest in stocks of companies that primarily operate in the health care sector of the United States.
  2. Investing

    How Aliko Dangote Became the Richest African

    An overview of how Aliko Dangote turned a local commodities trading business into a billion-dollar conglomerate.
  3. Investing

    Soul Cycle vs. Planet Fitness

    How has the fitness industry's shift from multipurpose health clubs to specialized studios and budget gyms played out for SoulCycle and Planet Fitness?
  4. Investing

    Which GOP Candidate Brings What to the Table?

    What are the major GOP presidential candidates' economic plans and how do they differ?
  5. Retirement

    How to Decide Where to Live in Retirement

    Here's a guide to help you decide where you want to live after retirement.
  6. Professionals

    How to Create a Retirement Co-Op in Your Community

    As the retirement boom continues, retirement co-ops are growing in popularity. Here's how to set one up in your community.
  7. Insurance

    The 4 Best Alternatives to Long-Term Care Insurance

    Understand what long-term care insurance is and the types of people who need this coverage. Learn about four alternatives to long-term care insurance.
  8. Investing News

    Austin Set to Rival Silicon Valley

    Over the years, Austin, Texas has lovingly embraced its quirky reputation with the slogan “Keep Austin Weird.” Today, the capital city is attracting several tech startups and investors, making ...
  9. Stock Analysis

    How Does Oscar Work and Make Money?

    Learn how startup Oscar is taking on the health insurance giants by offering customers free doctor's visits, generic drugs and 24-hour phone access to doctors.
  10. Entrepreneurship

    Top 3 Most Successful Korean Entrepreneurs

    Discover the backgrounds of some of the most successful Korean entrepreneurs and information about the companies and projects leading to their success.
  1. What's the average salary of an actuary?

    According to data reported by the U.S. Bureau of Labor Statistics (BLS), the average salary of an actuary—an individual who ... Read Full Answer >>
  2. Are Cafeteria plans exempt from Social Security?

    Typically, qualified benefits offered through cafeteria plans are exempt from Social Security taxes. However, certain types ... Read Full Answer >>
  3. Can your insurance company cancel your policy without notice?

    In most states, an insurance company must give a policyholder written notice of at least 30 days before canceling a policy. ... Read Full Answer >>
  4. How do I calculate insurance premium tax?

    In the United States, consumers do not pay any additional tax on health insurance premiums. However, your insurance premiums ... Read Full Answer >>
  5. Can your insurance company drug test you?

    Insurance companies have the right to require drug tests for health insurance and life insurance policies, but not all of ... Read Full Answer >>
  6. What is the difference between a peril and a hazard?

    The two related terms "peril" and "hazard" are often used in reference to the insurance industry. Essentially, a peril is ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Term Deposit

    A deposit held at a financial institution that has a fixed term, and guarantees return of principal.
  2. Zero-Sum Game

    A situation in which one person’s gain is equivalent to another’s loss, so that the net change in wealth or benefit is zero. ...
  3. Capitalization Rate

    The rate of return on a real estate investment property based on the income that the property is expected to generate.
  4. Gross Profit

    A company's total revenue (equivalent to total sales) minus the cost of goods sold. Gross profit is the profit a company ...
  5. Revenue

    The amount of money that a company actually receives during a specific period, including discounts and deductions for returned ...
  6. Normal Profit

    An economic condition occurring when the difference between a firm’s total revenue and total cost is equal to zero.
Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!