White House Delays Key Element in Affordable Care Act

BREAKING NEWS: Today, the Administration announced a delay in a key piece of the Affordable Care Act concerning the employer’s requirement to provide coverage to employees, the so-called “pay or play” mandate. Effective today, the employer reporting requirement – where employers and insurers are required to report coverage that was offered to employees and which employees enrolled in it – is delayed by one year. This means that the reporting will not take place until some time in 2015. Further, since the reporting is required to enforce the penalty – the “pay” part of pay or play – the IRS also announced that they are delaying the penalty by one year. This effectively pulls the teeth from the employer mandate to provide coverage to employees in 2014.

The Administration is making these changes in order to streamline the reporting process and give employers time to prepare for the reporting. It is important to note that no other portion of the ACA is being delayed by this announcement. For instance, the individual mandate is still in effect for January 1, 2014, and Exchanges are still expected to be open January 1 as well. Finally, the Administration is strongly encouraging employers to continue to maintain or expand health coverage in 2014.

Obviously, there are major implications on the timetable for ACA compliance, and as those become clear, we will keep you up to date.

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