Updated at 11:00 p.m. ET on Tuesday, July 2
Washington (CNN) - The requirement that businesses provide their workers with health insurance or face fines – a key provision contained in President Barack Obama's sweeping health care law – will be delayed by one year, the Treasury Department said Tuesday.
The postponement came after business owners expressed concerns about the complexity of the law’s reporting requirements, the agency said in its announcement. Under the Affordable Care Act, businesses employing 50 or more full-time workers that don't provide them health insurance will be penalized.
"We recognize that the vast majority of businesses that will need to do this reporting already provide health insurance to their workers, and we want to make sure it is easy for others to do so. We have listened to your feedback. And we are taking action," Mark J. Mazur, assistant secretary for tax policy, wrote in a post on the website of the Treasury Department, which is tasked with implementing the employer mandate.
Mazur said the extra year before the requirement goes into effect will allow the government time to assess ways to simplify the reporting process for businesses. Penalties for firms not providing health coverage to employees will now begin in 2015 – after next year’s congressional elections.
The new delay will not affect other aspects of the health law, including the establishment of exchanges in states for low-income Americans to obtain health insurance.
Supporters of the employer mandate note that most firms already provide health insurance to full time workers, and downplay the effect the requirement would have on small businesses, citing figures showing the vast majority of small businesses employ fewer than 50 workers.
But opponents claim the employer mandate is a potential job killer, saying businesses near the 50-worker cutoff will be unlikely to ramp up hiring if it means they're required to provide employees health insurance.
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“The administration has finally recognized the obvious – employers need more time and clarification of the rules of the road before implementing the employer mandate,” said Randy Johnson, a vice president at the U.S. Chamber of Commerce, a business group.
Obama's administration has previously expressed openness to making the health care law easier to implement, and acted to shorten applications for health insurance on government-run exchanges from 21 pages to three.
On Tuesday, Obama’s senior adviser Valerie Jarrett – who acts as the White House’s liaison to big business – wrote the new delay was indicative of the administration’s determination to implement the health care law effectively and fairly, and that it wouldn’t affect other aspects of Obamacare.
“While major portions of the law have yet to be implemented, it’s already a little more affordable for businesses to offer quality health coverage to their employees,” Jarrett wrote, adding later: “As we implement this law, we have and will continue to make changes as needed. In our ongoing discussions with businesses we have heard that you need the time to get this right.”
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Yet many Republicans – and even some Democrats - have continued to express serious concerns about the roll-out of Obamacare. On Tuesday, GOP lawmakers said the delay of the employer mandate didn’t go far enough.
“This announcement means even the Obama administration knows the 'train wreck' will only get worse,” House Speaker John Boehner wrote.
"Obamacare costs too much and it isn’t working the way the administration promised,” Sen. Mitch McConnell, the Senate Minority Leader, wrote in response to the decision, adding: “The fact remains that Obamacare needs to be repealed and replaced with common-sense reforms that actually lower costs for Americans."
Rep. Eric Cantor, the House Majority Leader, was more succinct. "The best delay for ObamaCare is a permanent one," he wrote on Twitter.
Many allies of Obama, including major labor unions, did not immediately weigh in on the delay. A spokesman for Senate Majority Leader Harry Reid said in response to the decision, "Flexibility is a good thing."
"Both the administration and Senate Democrats have shown – and continue to show – a willingness to be flexible and work with all interested parties to make sure that implementation of the Affordable Care Act is as beneficial as possible to all involved. It is better to do this right than fast," Adam Jentleson continued.
Yet even some Democrats have voiced concern about the roll-out of the health law – Sen. Max Baucus, a key Democrat who helped craft the legislation, expressed serious anxiety in April about its implementation.
"The administration's public information campaign on the benefits of the Affordable Care Act deserves a failing grade. You need to fix this," Baucus told Health and Human Services Secretary Kathleen Sebelius at a hearing.
"I just see a huge train wreck coming down," he added later.
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Can they finally just admit that the law is an unworkable mess and throw it out?
what and they are leaving the rest of us out here to see how it works! THANK YOU MR. PRESIDENT this going so well! Obama hit the middle class again. BIG company get to sit back and see how it goes
Repeal Obamacare now. Instead, allow the purchase of policies across state lines, thereby increasing competition among carriers.
Goes to show you who's running this country. If a bunch of citizens were to complain about the complexity of a law, do you think the government would postpone enacting a law?
All righty then!!! I can just hear what happened behind closed doors... "Hey, if this goes into effect next year, it is going to eliminate a lot of votes for our (i.e. democrat) candidates that voted to pass the 'Affordable Care Act'."
"You know, you are right... hmm... I got it!!!! we postpone pieces of it until the election cycle is passed! That will pull the wool over the voters eyes and insure that we stay in power!!!"
Delaying it shows no confidence in its validity nor benefit. The President should know better than waffle at this late date. It may undermine his entire effort. Leadership always sticks with their decisions.
Republicans will do whatever they can to prevent the poor and middle class from getting sensible, affordable healthcare. They never, ever, do anything to help anybody but the wealthy – but cleverly use the ignorant and fearful as their power-base. It is ironic to see the right-wing elderly fighting against a healthcare plan they need – but don't even understand.
Under the Republican "plan" the E.R. will continue to be the source of healthcare for the poor and the rest of the population will continue to pay for it. Their so-called free market solution will make corporate leaders choose between quality care and their profits. What do you think they'll choose?
Don't need more taxes out of my paycheck.
A delay in Obamacare just proves that this poilicy is a joke on American consumers..If this was great for America than bring it on in 2014 Mr President...LOL for a horrible policy!!!
Just more evidence that Obama is in the pocket of business just like W was. All that's happening is employers using Obamacare as an excuse to reduce employer contributions to healthcare plans. Meanwhile most insurance companies are experiencing near record profits.
Delayed? it should be stopped.. it's a pos program that pigeonholes everyone.. I would never participate in it nor would I ever pay a fine.
Large corporations are strangling small business. The Democrats, Republicans, and Tea Party all support and want to expand NAFTA, the one piece of legislation most responsible for outsourcing jobs to nations with near slave labor and zero regulations for worker pay, safety, and with near zero environmental restrictions. Why? By chance are the mega corporations and billionaires hiring lobbyists to pay and counsel politicians in all parties to turn a blind eye to international corporate interest at the expense of small business and the common consumer? No, that couldn't be it...... never.
And still Washington is rife with scandals and there are over 60 or 70 dead so far in our war in Afghanistan alone this year.....but we don't hear about that either. It is almost as if it has become taboo to talk about war deaths or the open relationship Democrats and Republicans have with NAFTA and how neither party are as interested in restoring jobs to the United States as they are helping Walmart and others maintain their unregulated and near slave labor manufacturing over seas. Lets face it, small business must follow U.S. law, mega corporations simply go to a communist or third world nation and break U.S. law openly then ship the items here to be sold to citizens who also must follow the law.
What is amazing to me is that if a citizen leaves the United States, they still are supposed to follow U.S. law. You can't go be a pervert in Cambodia legally. If you get caught you go to jail. But if you are an international corporation, you simply fund a few political parties and you can break any U.S. law you please. Small business can't compete with that and this system simply feeds the billionaires and starves the poor who can"t get jobs.
And still, news corps pick sides and the circle continues.
The people in business and in the general population told you it would not work and now we see it in postponements. Just another failure from a failure of a President won on hearts and not mind.
Yeah, let's postpone it until after the next midterm elections.... because we don't want what it's going to do to affect the outcome of the election.
If this was such a wonderful thing, why on earth aren't they just letting it happen already?
What a crock.
The business owners didn't want this mess when it was proposed, when it was debated and when it was passed.
Now Obama can't be saddled with the blame of this fiasco so the government delays the roll out.
I guess there weren't any more union waivers left to dole out.
The economy is stalled on this issue and these morons are continuing to stall business and donate 7 billion to Africa. I was a Democrat and I have switched because party trying to fix everything, but what they supposed.
SAVE THE UNITED STATES OF AMERICA AND IMPEACH OBAMA, NOW!!!
As the stench of scandal continues to engulf this administration and this president, we citizens must continue to demand that the miscreants are identified and punished. If the stench of scandal consumes this administration and this president, so be it! Our country thrived before this administration and this president. Our country will thrive after them.
American healthcare, though arguably superior in some instances, costs 2-3 TIMES what healthcare does in any other Western country. Obamacare will only produce jobs for the insurance industry and will serve to make American products even more expensive than they now are. So, you'll have insurance-paid healthcare (while you can still afford it) and see even more jobs on average disappear.
What is the problem? All health care is free under Obamacare. Or, that's what they led people to believe. Is it falling apart already?
This legislation was a mess from the start.
hilarious. Constitutional republic my tail
This is just more proof that healthcare in America should NOT be job related. It is socially destructive, pigeonholing workers and making businesses negotiate with the for-profit parasitic insurers that only add cost and complexity our healthcare system. An improved Medicare for All system would be far superior and allow some healthcare peace of mind for both workers and businesses alike.
repeal this law and impeach this president
Ha ha ha! 3 card monty game ending soon!
wait, what else is happening next year. . . oh, that's right, the last election during Obama's term. . . delay until after the sheep are in the shed. . . good call. . . wow. . .