White House Delays Obamacare Mandate Again

New rules soften the law’s employer mandate, which has already been delayed by a year.

National Journal
Sam Baker
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Sam Baker
Feb. 10, 2014, 11:16 a.m.

The Obama ad­min­is­tra­tion an­nounced fur­ther delays Monday in Obama­care’s em­ploy­er man­date — which has already been pushed back a full year.

Ad­min­is­tra­tion of­fi­cials said the latest delays are de­signed to give busi­nesses more flex­ib­il­ity and a longer trans­ition peri­od to be­gin of­fer­ing health in­sur­ance to their work­ers.

The Af­ford­able Care Act re­quires large em­ploy­ers — those with more than 50 full-time em­ploy­ees — to either provide health in­sur­ance to their work­ers or pay a pen­alty. The man­date was sched­uled to take ef­fect this year, but the Treas­ury De­part­ment pre­vi­ously delayed the dead­line un­til 2015.

Now it’s delay­ing the cov­er­age re­quire­ment even fur­ther.

Busi­nesses with 50 to 99 full-time work­ers — people work­ing at least 30 hours per week — don’t have to com­ply with the man­date un­til 2016, un­der fi­nal reg­u­la­tions the Treas­ury De­part­ment re­leased Monday.

Lar­ger em­ploy­ers aren’t get­ting an out­right delay but will have more time to fully com­ply with the man­date. Em­ploy­ers with more than 100 full-time work­ers must of­fer cov­er­age to 70 per­cent of their full-time em­ploy­ees this year, and 95 per­cent after that, to avoid pay­ing a pen­alty.

The ad­min­is­tra­tion noted that only about 4 per­cent of em­ploy­ers are eli­gible for one of the breaks an­nounced Monday, al­though those busi­nesses em­ploy about 72 per­cent of all private-sec­tor work­ers.

The vast ma­jor­ity of large em­ploy­ers already provide health be­ne­fits to their full-time work­ers. Monday’s changes are un­likely to make a sig­ni­fic­ant dif­fer­ence in how many people the Af­ford­able Care Act ul­ti­mately cov­ers.

Monday’s reg­u­la­tions also cla­ri­fy that vo­lun­teers — for ex­ample, vo­lun­teer fire­fight­ers — aren’t coun­ted as full-time em­ploy­ees, and they give em­ploy­ers more flex­ib­il­ity when count­ing work­ers’ hours. Those steps were de­signed to “kind of mit­ig­ate the way the 30-hour defin­i­tion works,” a Treas­ury of­fi­cial said.

Of­fi­cials said busi­nesses will have to at­test that they’re not cut­ting em­ploy­ees just to qual­i­fy for the ad­di­tion­al delay but noted that busi­nesses are still free to cut their work­forces for eco­nom­ic reas­ons.

Asked where Treas­ury found the leg­al au­thor­ity to phase in the em­ploy­er man­date, of­fi­cials said the de­part­ment has “broad au­thor­ity” to im­ple­ment tax laws in a way that will ease the ad­min­is­tra­tion of those laws.

“We think a phase-in ap­proach really is a way to ad­min­is­ter the law bet­ter,” a seni­or Treas­ury of­fi­cial said.

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