Administration Postpones Obamacare Mandate on Businesses--'Past 2014 Elections'

July 3, 2013 - 4:37 AM

obamacare application

Draft of the Affordable Care Act application for health insurance. (AP Photo)

(CNSNews.com) - The Obama administration announced on July 2 that it is giving businesses an extra year to provide the required health insurance coverage to their full-time employees without risk of incurring tax penalties.

"During this 2014 transition period, we strongly encourage employers to maintain or expand health coverage," the Treasury Department blogged.

Sen. Orrin Hatch (R-Utah), ranking member of the Senate Finance Committee, noted that the Obama administration is delaying the "job-killing requirement" for businesses, but not for individuals and families, who are required by law to purchase health insurance in 2014, either through their employers or on the new health care exchanges. Individuals who go without health insurance will face tax penalties, dubbed "shared responsibility payments" by the Obama administration.

"While a delay of this mandate is welcome news since it shows the challenges the employers are facing complying with it, a delay -- conveniently past the 2014 election -- only adds to the uncertainty these job creators face because of ObamaCare," Hatch said.

"And I certainly hope this action isn't a back door attempt at getting more Americans into the exchanges, which have been plagued by problems."

Hatch said the only "reasonable recourse" is to fully repeal the law.

"This delay, on top of the skyrocketing cost of insurance premiums, significant challenges with the exchanges and taxes administered by a scandal-plagued IRS demonstrate why this law is more unpopular with the American people than the day the president signed it into law."

Under the Patient Protection and Affordable Care Act, employers with 50 or more full-time employees are required to provide health insurance for them, beginning in 2014, or face a massive tax penalty. The requirement, which caused many employers to keep their full-time staffs below 50, will now take effect in 2015.

House Speaker John Boehner (R-Ohio) said Obamacare already is raising costs and costing jobs:

"This announcement means even the Obama administration knows the 'train wreck' will only get worse. I hope the administration recognizes the need to release American families from the mandates of this law as well. This is a clear acknowledgment that the law is unworkable, and it underscores the need to repeal the law and replace it with effective, patient-centered reforms."

Rep. John Kline (R-Minn.), chairman of the House Education and the Workforce Committee, said the employer mandate will destroy jobs, regardless of when it's implemented.

"If anything, this decision exacerbates the confusion and uncertainty employers face, and serves as further confirmation this flawed law is a 'train wreck.' In fact, jobs are already being lost and workers' hours slashed because of the president's health care law. No amount of bureaucratic tinkering can ease the pain ObamaCare is inflicting on our nation's workplaces. America's workers, families, and job creators deserve permanent relief from ObamaCare, not a one year reprieve.

Mark J. Mazur, the assistant treasury secretary for tax policy, said the administration -- in announcing the year-long delay for businesses -- is responding to "concerns about the complexity" of Obamacare's requirements and "the need for more time to implement them effectively."

"We have listened to your feedback. And we are taking action," Mazur blogged. He said the delay "will allow us to consider ways to simplify the new reporting requirements consistent with the law, and it will "provide time to adapt health coverage and reporting systems while employers are moving toward making health coverage affordable and accessible for their employees."

The administration plan to publish "formal guidance" describing the change Within the next week. "Just like the Administration’s effort to turn the initial 21-page application for health insurance into a three-page application, we are working hard to adapt and to be flexible about reporting requirements as we implement the law."

In a June 2013 report, the U.S. Chamber of Commerce urged that major elements of Obamacare "be rolled out in a more incremental way."

"Without a more modest transition, the goals of the law will be undercut. By phasing in certain insurance reform requirements, the impending significant rate increases that will otherwise begin in 2014 can be mitigated. However, without such a phase-in, new insurance rating requirements will substantially increase health insurance premiums in 2014 and significantly disrupt access to coverage and care for millions of employees and individuals."

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