Seeking to give employers and government departments more time to comply with the Affordable Care Act (ACA), the Obama administration recently delayed until January 1, 2015, the employer mandate to report on their coverage and pay a tax penalty for failing to provide full-time employees with affordable health coverage meeting certain minimum standards established by the federal government. This provision had been scheduled to take effect January 1, 2014. The delay applies to companies with 50 or more full-time equivalent employees, and companies smaller than that threshold were already exempt from the requirements.
Some provisions remain in place or are scheduled to take effect later this year or early next year. For example, the individual mandate to obtain health care coverage or pay a tax penalty remains in place to take effect January 1, 2014. Also, the health insurance exchanges are set to begin in October 2013.
Republican leaders have encouraged the Obama administration to grant everybody a delay from the Obamacare insurance mandate. “We agree with you that the burden was overwhelming for employers, but we also believe American families need the same relief,” commented House Speaker John Boehner.
Critics of the selective delay contend the move will force even more people who otherwise might have obtained coverage through their employer to go in search of insurance on the individual market or face a fine. Companies are not likely to make a decision before they are forced to do so if they do not already offer coverage. Thus, many individuals seeking to avoid the penalty will likely go on the exchanges and will seek additional taxpayer subsidies in the process.
The Obama administration has defended the decision to delay only the employer mandate suggesting it shows a willingness to be flexible and to accommodate business concerns.
“We have heard concerns about the complexity of the requirements and the need for more time to implement them effectively. We recognize that the vast majority of businesses that will need to do this reporting already provide health insurance to their workers, and we want to make sure it is easy for others to do so,” wrote Mark J. Mazur, the assistant secretary for tax policy at the Department of the Treasury.
The Obama administration is also giving states some additional time as well. For example, state-run marketplaces will not have to verify consumers’ claim that they do not receive adequate coverage from their employer until 2015. Also, electronic notices for Medicaid will not be required until 2015.
It can be a bit confusing what the exact policies are and how it will affect businesses and individuals. For more information, read the entire document recently released by the Department of Health and Human Services at https://s3.amazonaws.com/public-inspection.federalregister.gov/2013-16271.pdf
