Newest Obamacare Delay for Mid-Size Businesses

In the latest big delay of the Obamacare rollout, the Treasury Department announced yesterday that many employers won’t face a fine next year if they fail to offer employees health insurance.

Under the original 2010 Affordable Care Act, employers with the equivalent of at least 50 full-time workers had to offer health coverage or pay a penalty -- $2,000 per worker beginning in 2014. Last year, the Obama administration delayed that requirement for the first time by moving it to 2015.  Monday’s announcement puts off completely that requirement and penalty until 2016 for businesses employing 50-99 workers.

Other important changes to Obamacare were announced Monday but to far less fanfare:

• Under the new Treasury Department rules, businesses with 100 employees or more must offer coverage to at least 70% of full-time workers in 2015 and 95% in 2016, or face a penalty.
• Large employers (100+ workers) that currently offer coverage voluntarily will likely see simpler rules for how to prove that.   Full regulations detailing the reporting requirements have not yet been released.
• Employers with volunteer or seasonal workers (those employed less than 6 months) won’t be penalized for failing to offer those employees coverage, regardless of the number of hours they are working.
• Employers with fewer than 100 workers will have to certify to the government that they haven’t fired workers to get under the threshold and qualify for the delay until 2016. They also must certify they won’t drop health plans they already offer.
• The individual mandate remains in effect.

The new regulations are a welcome reprieve for mid-size employers who currently don't provide health coverage, or who are still scrambling to devise a comprehensive health care strategy for their employees.  But are those businesses off the hook completely this year?  Not a chance.  Employers still remain subject to a $3,000 penalty each time one of its workers buys coverage on a state health-care exchange and qualifies for subsidized premiums.  So, in a sense, even though businesses don’t have to offer affordable coverage this year, they do.

These new regulations are being met with harsh criticism by Republicans who want to see the entire law overturned.  Obamacare is going to take center stage in the mid-term elections this year, to what outcome I don’t know.  My best advice during this uncertain time is to keep yourself educated on the ever-changing world of Obamacare and make the necessary adjustments to ensure you stay in compliance.