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.
READ MORE: Myths about Obamacare
“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.”
READ MORE: How the next battle over Obamacare could be the ugliest yet
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.
READ MORE: Six companies cashing in on Obamacare
Its bad enough Obama can't create job, but its mindblowing he actively engages in bills like Obamacare that hurt job creation. Most people would rather work full time with no health insurance than be a part time worker.
Not ready for a 2,000+ page law. You don't say?!?
A bad idea is a bad idea no matter how long you postpone it. Obamacare is a very bad idea.
Of course he delayed it. Obamacare won't work, he knows it, and is waiting until after the 2014 elections!
The United States will do what it always does about every problem - NOTHING!
Seriously? So on a whim of one man those who have worked hard to comply have wasted their time and money while the slackers get rewarded for not doing what they were supposed to? Is this junior high school? I thought congress made law and the president was to follow it.
There has to be a catch here. Government actually listened to small business owners? Government actually listened to anybody but themselves?
So we and MediCare have been billed for the past 18 months to support a 2014 implementation. Where is all that money going now?
I am STILL WAITING for some one ANYONE come up, and announce a 5 or 10 step plan that will help the uninsured to become insured!! That will make it so the every day American will know what a procedure will cost BEFORE it is performed. That will make HOSPITALS and DOCTORS to list there services like every other business in America. People this is not a Democrat or Republican issue, healthcare costs effect us all!! And America pays the MOST for healthcare and we DO NOT live the longest. I just heard it costs almost twice as much to have a baby in America (close to $10,000) than any other industrialized nation and the mothers actually get to stay in the hospital longer!! This delay is proving the administration is attempting to implement a plan to help those who have no insurance while making minimal impact on employers. I challenge EVERYONE who is saying Obamacare is too costly to GIVE UP their health care insurance until a substitute plan is implemented. One of the EASIEST things to DENY other people is something YOU ALREADY HAVE. They sicken me.....and more Americans need to complain..
Meanwhile... I'm sure the Republican conservatives are just dying (wish they were dying) to get their hands on decreasing our entitlement plans–or will that be put off for another year?
Everyone but the koolaid drinkers has been saying from the beginning that this was impossible. The koolaid drinkers have been say it's not even remotely a problem. I'm guessing this is the first in a long string of delays and changes.
Gotta love how the domestic-terrorist, America-hating GOP lies about the context Baucus made his comment in. Contrary to the GOP saying the healthcare LAW is a "train-wreck", Baucus was referring to the PUBLIC INFORMATION campaign, which has been a "train-wreck", because the Democrats need to fight harder against the GOP lies and propaganda campaign.
What a joke this president has become..
Postpone the train wreck until after the 2014 elections...........
obama is doing this to get mid term votes?
We bought our own health insurance for years (Kaiser); then when I got employed, my company pays about half of health insurance premiums. But companies less than 50 people, or people too poor or two libertarian to buy any health insurance, will continue to leech off me because I have to pay more in insurance and taxes for them to use emergency hospitals.
Pelosi and other senators helping buddies to get ACA exemptions but telling us as it is very good “for all of us” bill..
Can you remind me why we have it in the first place and who is going to pay if small businesses excluded?
This should be written in crayon w/ pictures so the democratic voter will understand a small part of the horror that is coming. But at least they got their free phones and free contraception!
The business across U. S. would have additional time to shop around for their employees ' affordable health care insurance programs , by mandated delay until 2015 . Notably , this is the right thing and a measured response by Obama administration at this time , in the face of hostilities and in actions by 113th Congress . As a matter of huge cost concerns , there should have been some urgently needed bipartisan reforms in Affordable Health care Act . Sen. McConnell and GOP in Congress have this obsession to repeal the Affordable Healthcare Act . The Affordable Healthcare Act is Law of the Land . The GOP House majority last month had 37th attempt to repeal this law . This has become worry some for 23 million unemployed and under employed , , 49 million under poverty line and a seriously shrinking middle class in last six years , and their millions of family members and friends . What a shame ? The GOP has lost five of last six elections , and have not learned any lessons yet . Sen. . McConnell and many others in GOP would like to make the Obama care law , an issue in midterm elections. would get another shock of big loss in 2014 mid term elections , if they do not change their course
can you postpone the increase in premiums that have already taken place?
Delayed until after the 2014 elections. There is no end to these people's audacity...and this helps big business. I thought that was the sole responsibility of the republicans?
The headline should read, "Obama intentionally delays the implementation of Obamacare until after the 2014 election"
But, since CNN is Obama's lapdog, this is what you get.
My companies insurance provider has already informed us to expect a 40% to 50% increase in premiums. This is on top of the 70% increase in premiums over the past 4 years! Affordable... I don't think so.
Yes! Yep! I'm positive I just heard a pin drop.
I would like to hear Ms Jarrett explain how healthcare will be more affordable to employers. I would like to see a one to one comparison between existing policies and proposed policies. Not irrelevant comparisons