President Obama’s administration has decided to delay enforcement of one of the key provisions in the Patient Protection and Affordable Care Act (PPACA): the Employer Mandate.
Mark Mazur, Assistant Secretary for Tax Policy at the U.S. Department of the Treasury, posted on the White House’s Treasury blog on July 2. In this post, he announced that the administration has decided to postpone enforcement of the Employer Mandate portion of the Affordable Care Act by a full year.
This was done because the administration has “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.”
According to the blog, this action accomplishes two goals: “First, it will allow us to consider ways to simplify the new reporting requirements consistent with the law. Second, 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.”
Employer Mandate Impact on Businesses
Setting politics aside, I want to address the impact of this news on the business climate.
People whose opinions I trust have shared that they think this law will be overturned. While many businesses would relish that, I was hesitant to believe that it would happen. Until I read this Wall Street journal editorial on July 3 that addresses the issue of the individual mandate. The article contents that the mandate cannot possibly survive this and be implemented on on 1/1/14.
The reason, they cite, is in the name, Affordable Care Act. Individuals without coverage at work and those who earn lower income levels are supposed to be subsidized. This subsidizing would occur when buying insurance through exchanges.
According to the WSJ editorial, “Individuals are only supposed to be eligible for ObamaCare’s subsidies if their employer doesn’t offer the right benefits. But how will the Treasury know who qualifies in 2014 if they lack the information that businesses are supposed to provide? Citizens must also pay the individual mandate-tax if they decline coverage from their employer. How will the Treasury verify these offers?
In other words, who qualifies for the subsidies?
When you look at these latest developments, plus the growing concerns that these Federal exchanges will not be ready to go by October of this year, the employer-sponsored healthcare landscape has become much more muddled.
Do you think that the individual mandate will survive? Share your thoughts in the comments below.