There It Is: Obamacare Employer Mandate Delayed For Companies With Under 100 Employees

Tyler Durden's picture

Just as we predicted it would happen, here it comes:

  • OBAMACARE EMPLOYER MANDATE TO BE DELAYED FOR SOME COMPANIES

Specifically, according Bloomberg, businesses with 50-99 workers have until 2016 before being penalized for not providing health-care coverage to full-time workers, according to final regulations released by Treasury.

Additionally, businesses with 100 employees or more must offer coverage to at least 70% of full-time workers in 2015 and 95% in 2016; those that don’t will face penalty;  Exemption in place for seasonal workers, those defined as generally at jobs 6 mos. or less/yr "While about 96 percent of employers are not subject to the employer responsibility provision, for those employers that are, we will continue to make the compliance process simpler and easier to navigate,” Asst Secretary for Tax Policy Mark J. Mazur says in statement e-mailed by Treasury. Furthermore, businesses with less than 50 employees are not required to provide coverage or fill out any forms in 2015.

Sure enough, the republicans were ready at the trigger:

Why is this not surprising? Recall what we said a few short days ago:

... the only reason why Obama is suddenly willing to compromise over every aspect of his "crowning achievement" is that finally its tactical, and strategic failure has become clear for all to see. So it would be best to enact it piecemeal, and claim success for whatever legacy aspects of the system are working, while blasting everything that his unprecedentedly complicated, centrally-planned contraption has unleashed.

 

Finally, why three years? Because by then Obama will be gone (absent some very radical changes to presidential term rules), and Obamacare will be someone else's problem.

Then again Hillarycare sounds so much better than Christiecare.

And so Obama's crowning achievement is just a little less crowning. However, the true negative impact will be borne not by the current president but his successor... who will likely do the same and extend the full provisions indefinitely as well, as the last thing the struggling economy needs right now, as we have not tired of explaining for the past two years, is, well, Obamacare.

 

More color via Washington Post,

The Treasury Department rolled out Monday afternoon more tweaks to the health care law's requirement that all large employers--those with 50 or more workers--provide insurance coverage to their workers. This is the part of Obamacare was supposed to take effect at the start of 2014, but was delayed by the White House this past summer as the White House was facing significant push back from employers.

In today's final rule, the Obama administration is essentially relaxing the employer mandate for 2015--in a big way for medium-sized businesses, and a smaller way for the largest employers. Here's a rundown of the key changes.

1. Employers with between 50 to 99 employees get another year of transition.

The Obama administration will give medium-sized businesses another year's pass on providing insurance coverage to workers. Treasury estimates that about 2 percent of American businesses fall into this category, but does not have numbers on how many people work for businesses of this size. For these companies, the employer mandate does not take effect until 2016.

Employers who want to take advantage of this particular exemption will need to certify with the federal government that they are not cutting back on positions just to fall below the threshold. "It's simply so they don't game the system," one senior administration official told reporters on a phone call this afternoon. "They have to certify they're not doing that and not dropping their coverage."

2. Employers with 100 or more workers aren't required to cover everyone.

Previous regulations had required large employers to offer coverage to 95 percent of full-time employees to be considered in compliance with the employer mandate. Today, Treasury is ratcheting that requirement back: Large companies that offer coverage to 70 percent of their employees will be counted as fulfilling the employer mandate. This is a transitional measure and, by 2016, large employers will need to hit the original, 95 percent target. Treasury estimates another 2 percent of American businesses fall into this category, with more than 100 employees, but again, we don't have numbers on how many workers those companies employ.

3. Volunteers won't be counted as full-time employees.

There had been some tussling on Capitol Hill over whether certain volunteers - mostly volunteer firefighters - would count as full-time employees, for purposes of the health care law. Today's rule clarifies that they do not count as employees--which eliminates any incentives to get rid of volunteer positions.

There are other, smaller tweaks in the new Treasury rule that deal mostly with how, exactly, employers are supposed to count how many hours employees work (for seasonal workers, for example, or teachers, this can actually be a pretty difficult task.)

It's hard to to know how many people will be impacted by these changes since there isn't great data on how many people work for the different-sized employers.

 

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Does this mean, according to inevitable WaPo fluff piece follow up to its ode to unemployment, that millions of workers will no longer get the privilege of being untethered from their jobs?