Employer Requirements for Obamacare Extended Another Year
Updated: Mar 18
People refer to the health reforms that have been passed by the United States Congress as Obamacare, but the real name for the act is Affordable Health Care. There has been plenty of things said about how the health care industry is going to be destroyed and how small businesses are going to be severely impacted by the changes that are going to be required. Not everyone agrees on how everyone will be affected, but the one thing they can agree on is it is very confusing. The size of the new laws and the implementation of these laws have left plenty of people wondering what will happen next.
Businesses have been among the loudest complainers about the impact of this act. They claim that the increased costs they will incur because of the necessity to provide health insurance options for their employees will cause them to cut back on staff or make other reductions to remain profitable. There is a reprieve for business owners. It was announced that the penalties for employers who do not provide health insurance for their employees will not have to pay a $3,000 fine until 2015. That is a one year delay in the enactment of these penalties.
What Businesses have to Provide Insurance
According to the Affordable Health Care Act, any business that has at least 50 full-time employees must provide must provide qualifying health benefits to their workers. If they do not, they will face stiff penalties that are referred to as shared responsibility payments.
Why Delay It
The extra year is designed to provide employers with more time to make a smooth transition so that it will not impact their business in a negative way. While many people may see this as a significant blow to the ability of the Affordable Health Care Act to work, the impact of the delay is actually very minor. According to estimates, 94% of businesses that have over 50 full-time employees already meet the requirement to provide health insurance. That means the delay will affect only 6% of the businesses and it will give them the time they need to make the necessary changes. Most employees will still get the access to health insurance that they need.
What Else Does it Mean
The bigger impact is how this affects the Affordable Health Care Act politically. By delaying the implementation of part of it less than 6 months before it is supposed to take place, it shows how strong the fight will be to repeal or delay other parts of the act. The fight about Obamacare is far from over.