Obama Administration Delays ACA Provision for Employers to Provide Health Insurance

A major component of the Affordable Care Act, which requires employers with at least 50 workers to provide health insurance, was delayed by the Obama administration on Tuesday, July 2.  Originally, employers that failed to provide insurance were to be penalized starting January 1, 2014. With the delay, penalties will not take effect until 2015. Additionally, employer shared responsibility payments will not apply until 2015.

While the delay will certainly insure fewer individuals, the other two major provisions of the ACA—expanding Medicaid and requiring individuals to obtain coverage or pay a penalty—will be implemented as planned and are predicted to insure a larger number of people than the delayed employer mandate. This requirement has been postponed with the hope that the extra year will allow time to simplify the reporting systems and processes that many businesses have previously had complaints about.

Those in favor of the mandate argue that most large businesses already provide health insurance, and those that are smaller most often employ a number of workers well under 50. Those against dispute that the mandate will discourage small businesses from hiring more workers, as they will not want to assume the costs of employees health insurance.

Click here to read the US Treasury statement on the delayed provision.


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