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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Yeah, better push this back until after the elections...
Well this is one way to handle this. If we eliminate all of the unnecessary, burdensome, wasteful, and downright illegal aspects of this law, we will all just have to deal with the 4% of it that remains.
How convenient to wait until after the 2014 mid-term elections Obama...people aren't stupid
How nice for him to hold off on this until after the 2014 elections.
We all know where this is going – but with all the president has on his plate this might not be such a bad thing. Republicans will never stop trying to get this law overturned, even though the SC has already ruled it constitutional. One more year to try and work on its implementation for the betterment of the people, might help calm some employers down and help get some more people back to work. Of course I could be wrong, because afterall, this is the TP we're talking about.
This is what happens when you have a legislature that does not read the legislation it is voting on. It is a clear case of someone having put their ideology well ahead of common sense. "We have to pass it before we can tell you what's in it." Obamacare has proved just how senile and incompitent Nancy Pelosi is. It has also revealed several weaknesses in how our legislature works. We should inquire of our candidates how many pages should be in a bill before we vote for them. If they answer more than 100, then I say don't vote for them.
Business doesn't want to pay for insurance but they spent so much on defeating the public option that we don't have an option. We should go back and create the public option we all wanted. The USA spends three times as much for crappy care because we will not accept that this is a case for natural socialism just like a fire department or police force. We never learn until we make every mistake first.
Obamacare had a Public Option. This is the love child of Lieberman and the GOP that we have now.
Can this be described as anything be complete incompetence? Adding another year of uncertainty is exactly what the economy does not need.
If you think I'm going to pay a fine for not buying insurance then you are completely insane. That goes to any human on the face of the earth. This is criminal behavior by this lying tyrannical administration.
And no delay on the individual mandate. We wouldn't want to cheat the insurance companies out of their promised windfall, now would we. If any of you still honestly believe Obama or any D or R actually care about the average American, now would be 13 years too late to re-examine your lack of critical thinking and reasoning. What a joke.
Sounds like big business scores again! Everyone will be required to have insurance in 2014 but large employers don't have to be the ones to provide it. This is not about confusing rules, this is about greed and nothing else.
Wow, I bet soon there will be a lot of 51st employees looking for work.
Strange, I thought the timetable was part of the legislation passed through Congress. How are they able to delay it?
So, another law that Obama chooses not to enforce.
"I just see a huge train wreck coming down,"
so now everyone but the actual citizens have an out......why can't they man up and say we are gonna charge you money because we can
Maybe they'll just keep putting it off, and putting it off, and putting it off.
And the wheels come slowly off the bus.
Is anyone truly surprised. They (our government) was no where near ready to implement all the required elements. Or,,, is this just part of the plan for failure, and quick change to mandated single payer plan?
This delay is en light of the 2014 elections. No big deal.
Let the whining start!!!
the repubs are succeeding destroying obamacare. the poor and uninsure will bear the brunt of this disassembly that the repubs and their sable wrangling is doing. lesson folks when are we going to get off the sidelines and start helping the unfortunates in this country, its a darn shame that lesser countries has healthcare for their citizen and just because of hatred for this president, the repubs are willing to destroy the only universal healthcare we have, which countless presidents before have tried to accomplished and failed. now its back to the status quo of big insurance companies leaving the average americans on the street to fend for themselves when they get ill. their is no way the repubs will replace this law with something else, because they have to please their corporate buddies. you know what i am not even sorry for some of these folks, especially those that are blinded by hatred of the first black man taking over the white house, that they will follow lthe repubs and their wacky ambition to destroy this country just to say obama did it.
A fair and rational decision.
Its easy to afford insurance for all employees, just lower everyones pay to cover the cost and any extra time spent doing paperwork for it.