Health Care Law Blog

Large Employers Rejoice! PPACA’s Employer Mandate Delayed until 2015

On July 2, 2013, the Obama administration declared that it was delaying the effective date of the Patient Protection and Affordable Care Act’s Employer Mandate until January 1, 2015. The Employer Mandate, which was scheduled to become effective on January 1, 2014, required all large employers to offer health care coverage to their full-time employees or pay a penalty. Most importantly, this delay means that the penalties to large employers for failure to provide health insurance coverage will not be enforced for another year. You may read the full statement issued by the U.S. Department of Treasury here.

In the past several months, employers have been scrambling to understand the technical requirements of the law and prepare a strategy for implementing its mandate. They have voiced serious concerns about the Employer Mandate’s effect on their businesses, in particular, the financial burden they would face by offering coverage to their full time employees. Compliance with the new law has required tracking employee hours, evaluating strategies to cut costs and adopting systems to document data, all of which must be addressed as the deadline has drawn closer. Therefore, the delay of the Employer Mandate is a welcome relief. The scope of such relief remains to be seen, but formal guidance related to the delay is expected within the next week.

The latest announcement does not impact the Individual Mandate, which generally requires all individuals to maintain health insurance as of January 1, 2014 or be charged a penalty. The uninsured will still be able to acquire health insurance through private means or through the health insurance marketplaces (exchanges), whose open enrollment period is scheduled to begin on October 1, 2013.

Foster Swift is committed to follow the ever-changing developments of this law. If you have any questions, please direct them to a member of our Health Care Reform Team:

• Mindi Johnson (616) 726-2252 - Grand Rapids
• Joshua Wease (616) 726-2215 - Grand Rapids
• Lauren Dunn (517) 371-8324 - Lansing

Categories: Employment, Health Care Reform, Insurance