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The Effect of Healthcare Reform on Hiring Practices

The Reform Act has affected more than just hospitals and medical professionals. In fact, it has affected more than just the general American populace. The Reform Act has actually affected the hiring practices of many businesses that would normally be able to take on more workers, but due to the new health care reform guidelines are under constraint of the cost of healthcare for each employee. The following is a list of the effects of the Health Care Reform Act on hiring practices and how these hiring practices are affecting the unemployment rate and the employment factors of many business operations.

Part-Time Versus Full-Time

One of the main hiring practices that is being affected by the Health Care Reform Act is the choice between full-time or part-time employees. For example, the pizza company Papa John's has cited the Health Care Reform Act and the requirement for them to supply healthcare to all employees will increase the business costs overall and could force the business to go bankrupt as a whole across the country. When prior to the Health Care Reform Act, this company could afford to hire several part-time employees and at least begin to help the unemployment rate within the United States.

However, Papa John's has stated that if the Health Care Reform Act does require them to supply healthcare to all employees they will have to move to full-time employee status which means less employees, no part-time employees and a reduction of business cost to offset the high increase of healthcare costs.

Movement to Home-Based Employees

Many businesses have decided to carry on hiring practice of moving their full-time employees to at home employees. In order to achieve this they will offer the freelance employees the chance to become independent contractors. In many cases this reduces the individuals amount of taxes but may also increase the amount a business can pay to employees.

For example, if a full-time employee making $10 an hour in the office and the company has to pay for healthcare, the company may be actually paying up to $25 an hour for the same employee in order to cover all the costs of maintaining that employee. However, if they asked the full-time employees move for a freelancing option they can increase the now independent contractors pay to $15 an hour which will reduce the businesses overall cost and will allow the individual to make more per hour. This is a win-win situation for both the business that is struggling and for the employee.


One of the most discussed hiring practices that many businesses are looking towards outsourcing. For various reasons outsourcing may cost less for a business to accomplish than having a full-time staff, part-time staff or home-based staff. In these situations where business will do is keep several full-time staff members that are now working from home as either employees or as independent contractors to manage outsourcing options. They will have a business manager who will handle the hiring and firing of individuals and other administrative managers that will handle any kind of day-to-day issues that may arise. This is a last resort for many businesses that do not want to lose their business due to Health Care Reform Act and the new guidelines it sets that will cost the business to increase in production costs.

There are several other reasons that health care reform has led to different hiring practices for different businesses. This can be seen across the board in construction businesses, standard administrative businesses and especially in the medical profession. There doesn't seem to be a change for hiring practices that is not directly connected to the healthcare reform act.


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