Katherine Kersten: Obamacare now begins to reveal itself

We're just beginning to feel the tremors of the public-policy earthquake that is Obamacare. In coming months, this 2,300-page law promises to trigger unintended consequences that will cascade across the economy, affecting every household's health care options and pocketbook. The scale of change will become clearer as employers wade through the law's bewildering maze of new mandates, penalties and taxes, and as they determine how to react.

Low-skilled workers are likely to be among the earliest casualties. Adults without a high school degree already face a fearful 14.5 percent unemployment rate, with teens limping along at 26 percent. Yet Obamacare will make it even harder for them to find and keep a job.

How could this be? Wasn't the overhaul supposed to benefit less-well-off Americans?

The answer is straight out of Economic Incentives 101. The new law requires employers either to offer health insurance or to pay an annual penalty of $2,000 per worker. But the mandate and penalty don't kick in unless a firm employs more than 50 workers. So many small-to-medium-sized businesses -- including the retail stores, restaurants, fast-food outlets and hotels that disproportionately employ low-skilled workers -- will struggle to stay under that magic number.

Such firms "will have an incentive to become more automated, or machinery-intensive -- and hire fewer workers," writes Diana Furchtgott-Roth, former chief economist of the U.S. Department of Labor. "Fast food restaurants could ship in more food and have it reheated, rather than cooking it on the premises. Department stores could have fewer sales clerks and more price-scanning stations."

Part-time workers -- who include 50 percent of restaurant employees and 36 percent of retail workers -- may suffer most, says Furchtgott-Roth. Obamacare will make it more expensive to hire part-timers, she explains, because the extra cost of their mandatory health insurance -- or a $2,000 penalty -- is a larger percentage of their wage. "Employers will generally prefer to hire full-time workers and even pay them extra to work overtime."

Low-skilled workers aren't the only Americans in for a rude surprise. Despite the president's promise that "if you like your plan, you can keep your plan," there are signs that the new law may lead some corporations to drop health care coverage entirely -- sending shock waves through the middle class. "Many large companies are examining a course that was heretofore unthinkable, dumping the health care coverage they provide to their workers in exchange for paying penalty fees to the government," according to Fortune magazine.

Companies that opt to drop health insurance may avoid not only higher costs but an expensive administrative headache. "The potential costs ... of the fines, penalties, mandates, and exposure to risk under Obamacare are great," writes Grace-Marie Turner of the Washington-based based Galen Institute. For example, she explains, "Even employers who offer health insurance are at risk of paying penalties if the premiums they charge exceed 9.5 percent of an employee's household income -- a figure that will be extraordinarily difficult for employers to ascertain."

If businesses drop private health insurance plans, government costs will explode -- destroying yet another false promise of Obamacare: that it will control public health care spending. Workers will be shunted into state-run insurance exchanges, where many will become eligible for generous subsidies. By 2020, families of four earning between $22,000 and $88,000 would pay between 2 percent and 9.5 percent of their incomes on premiums, with taxpayers on the hook for the rest. According to Fortune, a family making $66,000 would pay just $5,300 a year, with the government picking up the difference -- more than $10,000.

When it was enacted, Obamacare purported to control deficits only by assuming that America's employers would remain the foundation of the nation's health care system. Now we know this may be a vain hope. And last week, the Congressional Budget Office doubled its estimates of certain cost increases linked to the law from $55 billion to more than $115 billion in the first 10 years.

House Speaker Nancy Pelosi famously quipped that we'd have to pass Obamacare to see what's in it. Americans are now beginning to see what's in it, and are ruing the day we took this national leap of faith.