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Obama Administration Postpones Employer Mandate in Heath Care Law

July 3, 2013

(Washington, D.C.) — In a welcome development for AMSA's larger members, the Obama administration announced yesterday evening it will delay a central provision of its health-care law, which will give businesses an extra year to comply with a requirement that they provide their workers with insurance..

The government will postpone enforcement of the so-called employer mandate until 2015, after the congressional elections. Under the provision, companies with 50 or more workers will face a fine of as much as $3,000 per employee if they don't offer affordable insurance.

The delay in the employer mandate addresses complaints from business groups to the administration about the burden of the law's reporting requirements.

The individual mandate, a linchpin of the law that requires most Americans to carry health insurance, remains in effect.

Congressional elections will take place in November of next year, and the delay potentially shields Democratic candidates from a backlash generated by the additional regulations on employers. The White House had been in discussions with business groups over complaints about the reporting requirements and believes it can simplify the process.

The employer mandate imposes extensive reporting requirements on businesses including the months during which each employee and any of their dependents was covered by health insurance.

According to a White House fact sheet, more than 96 percent of companies with at least 50 employees already offer health insurance to their employees.

The officials said the decision stemmed from a commitment in the administration to reduce regulatory red tape and drew parallels to a move earlier this year to cut the length of application forms for insurance provided through government-sponsored exchanges to three pages from 21.

It is not the first time President Obama has been forced to scale back the law's features. In March, the administration said small businesses wouldn't be able to give their workers a choice of health plans in exchanges set up just for them. In January, a plan to create new nonprofit insurers in states was curtailed after Congress capped funding for the companies.

AMSA's Government Affairs Department will continue to monitor developments in efforts to implement this complex law.