The so-called “employer mandate” under the Affordable Care Act (ACA), requiring businesses to provide healthcare coverage to their employees or pay penalties, will be delayed for one year, until 2015. In a blog posting on July 2, Mark J. Mazur, assistant secretary for tax policy at the U.S. Department of the Treasury, said that the Administration had “heard concerns about the complexity of the requirements and the need for more time to implement them effectively” and would publish formal guidance on the transition within one week.
Mazur’s blog posting cited two purposes for the delay: “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.” Mazur said that proposed rules implementing the information reporting requirements will be published this summer “after a dialogue with stakeholders - including those responsible employers that already provide their full-time work force with coverage far exceeding the minimum employer shared responsibility requirements.”
As more fully discussed here, the ACA will impose a “shared responsibility payment” of $2,000 per employee per year (not counting the first 30 employees) on corporations with at least 50 full-time employees that fail to provide health benefits to at least 95% of their employees.
Mazur added that the Administration will “strongly encourage” employers, insurers, and other reporting entities to voluntarily begin reporting in 2014 the health coverage offered to full-time employees, in preparation for the full application of the employer mandate in 2015. “Real-world testing of reporting systems in 2014 will contribute to a smoother transition to full implementation in 2015,” he said.
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