What the Employer Mandate Postponement Means for Employers
One of the biggest requirements under the Patient Protection and Affordable Care Act (PPACA), the employer mandate, has been postponed until 2015 amid widespread confusion and complaint over the provision. The mandate will require employers with at least 50 full-time employees to determine and report whether or not their workers are eligible for health care under the PPACA. Also known as the “play or play” requirement, employers of appropriate size will be required to offer health care to eligible employees or face financial penalties from the U.S. government.
The Obama administration has promised that the government will publish formal guidelines regarding the transition and what is expected from employers once the mandate is implemented. The administration has also stated that once it has issued its guidance on the issue, it will encourage and assist employers and insurers in voluntarily implementing the new reporting requirements ahead of the 2015 deadline. However, the individual mandate, which requires most Americans to carry health insurance or face penalties, is still on for a January 1, 2014 start date.
The delay is intended to accomplish a couple of stated goals, including: allowing for time to formulate a simplified set of reporting requirements and provide time to adapt health coverage; and reporting systems as employers work toward developing more affordable and accessible health coverage instead of after they are forced to comply with the mandate. Should an employer decide to offer coverage in lieu of paying a “shared responsibility” penalty, it now has an additional year to come into compliance with the reform law.