Washington Bureau

02.10.14

Obama Administration Announces Further ACA Delays

On Monday, the White House announced that it would delay the implementation of the employer mandate in the ACA for another year for businesses between 50-100 employees.

The Obama administration Monday announced that it would further delay the implementation of part of the Affordable Care Act.

The delay will postpone the mandate for employers with between 50-100 workers (the mandate does not cover businesses with fewer than 50 employees) to provide health insurance as well as limit its applicability to larger businesses. Instead of having to provide coverage to 95% of workers, they will only have to deal with health care for 70% of workers. Under Obamacare, if employers don’t comply with the mandate they will have to pay fines of up to $3000 per uncovered employee.  Initially, under the ACA, the employer mandate was supposed to take effect at the beginning of 2014 but has since been delayed once in July 2013. Now, for many businesses, there will be yet another year’s respite from the ACA’s mandate.

The rule may not have huge real-life implications for workers without health care---91% of businesses with over 50 employees already offer health care according to the Kaiser Family Foundation. But it will have major political implications for the 2014 elections.  Republicans are still ardently opposed to Obamacare and aim on using the 2014 midterms as yet another referendum on the President’s signature health care program, which has been riddled with problems, most notoriously the failure of healthcare.gov, as it has come into effect over the past few months.

The irony, of course is that after a government shutdown provoked by Republican demands for a one-year delay of the Affordable Care Act, the Obama administration is now, at least in part, doing what Ted Cruz and House Republicans urged in the fall of 2013.  There are obviously huge differences in terms of the policy implementations of delaying the entire law, including the individual mandate, as opposed to the relatively limited impact of the changes announced today. But, it still comes as an embarrassment for the administration and gives opponents of the program yet another opportunity to say “I told you so.”