Health Insurance Enforcement Delayed Again for Some Employers

The Obama administration announced Monday that it would again delay enforcement of a federal requirement for certain employers to provide health insurance to employees, giving medium-size companies extra time to comply.

The “employer mandate,” which had already been delayed to Jan. 1, 2015, will now be phased-in beyond that date for some businesses with more than 50 employees. Businesses with fewer than 50 employees were already exempt.

Under the Affordable Care Act, larger employers are generally subject to tax penalties if they fail to offer “minimum essential coverage” to full-time employees and their dependents.

The administration laid out a three-tier approach.

1. For larger employers with 100 or more employees (about 2 percent of employers): Seventy percent of employees must be offered coverage in 2015, and in later years at least 95 percent of employees must be offered coverage. Employers that do not meet these standards will be subject to tax penalties.

2. For employers with 50 to 99 employees (about 2 percent of employers): Companies with 50 to 99 employees will have an extra year, until 2016, to provide coverage or pay tax penalties.

3. For small businesses with fewer than 50 employees (about 96 percent of all employers): These companies will not be required to provide coverage or fill out any forms in any year.

Members of Congress asked how the president could unilaterally waive provisions of the law. J. Mark Iwry, deputy assistant Treasury secretary for health policy, said the administration had broad “authority to grant transition relief” under a law that directs the Treasury secretary to “prescribe all needful rules and regulations for the enforcement” of tax obligations.

This authority has often been used to “postpone the application of new legislation when immediate application would have subjected taxpayers to unreasonable administrative burdens or costs,” Mr. Iwry said.

The announcement Monday followed numerous other steps by the administration to postpone and cushion the impact of the health care law.

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