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Another delay in health law's employer requirement
Feb 10, 8:28 PM (ET)
By RICARDO ALONSO-ZALDIVAR
(AP) This Nov. 27, 2013, file photo shows part of the HealthCare.gov website page featuring...
WASHINGTON (AP) - Angling to avoid political peril, the Obama
administration Monday granted employers another delay in a heavily
criticized requirement that medium-to-larger firms cover their workers
or face fines.
In one of several concessions in a complex Treasury Department
regulation of more than 200 pages, the administration said companies
with 50 to 99 employees will have an additional year to comply with the
coverage requirement, until January 1, 2016.
For businesses with 100 or more employees the requirement will still
take effect in 2015. But other newly announced provisions, affecting
technical issues such as the calculation of working hours, may help some
of those firms.
More than 90 percent of companies with 50 or more employees already
cover their workers without the government telling them to do so, but
the debate has revolved around the potential impact on new and growing
firms. Most small businesses have fewer than 50 workers and are exempt
from the mandate. However, employer groups were also uneasy with a
requirement that defines a full-time worker as someone averaging 30
hours a week.
Republicans trying to take control of the Senate in the November
elections have once again made President Barack Obama's health care law
their top issue, casting it as job killer. They want to use the employer
mandate to build that case, with anecdotes of bosses reluctant to hire a
50th worker, or slashing the hours of low-wage workers who need to pay
household bills. Monday's moves by the administration seemed calibrated
to reduce that risk.
The reaction of business groups was mixed.
"These final regulations secured the gold medal for greatest assistance
to retailers, and other businesses, and our employees," said Neil
Trautwein, a vice president of the National Retail Federation.
The U.S. Chamber of Commerce was unimpressed, calling it more of a respite than a fundamental change.
"This short-term fix also creates new problems for companies by moving
the goalposts of the mandate modestly when what we really need is a
time-out," president Thomas Donohue said in a statement.
The administration still hasn't issued rules for reporting requirements
on business and insurers, the nitty-gritty of how the coverage
requirement will be enforced.
Administration officials and the law's supporters said the concessions
were the sorts of reasonable accommodations that regulators make all the
time when implementing major new legislation. The Treasury department
said Secretary Jack Lew was well within his legal authority in making
"This common sense approach will protect employers already providing
quality insurance, while helping to ensure that larger employers are
prepared to meet their responsibility to their hard-working employees,"
said House Minority Leader Nancy Pelosi, D-Calif.
But Republicans said they smelled fear.
"It is clear Democrats don't think they can survive politically if
Obamacare is allowed to fully go into effect," said Rep. Dave Camp,
R-Mich., who as chairman of the Ways and Means Committee oversees the
tax penalties enforcing the mandate.
The law passed in 2010 required employers with more than 50 employees
working 30 or more hours a week to offer them suitable health coverage
or pay a fine. The coverage requirement was originally supposed to have
taken effect this year.
But last summer the the administration announced a one-year delay, the
first sign of potential problems with the rollout of the health care
Since then it's been a gigantic crisis management drill. The new online
signup system at HealthCare.gov was crippled by technical problems for
the better part of two months last fall. Separately, millions of people
who were already buying health insurance individually had those policies
cancelled because the plans did not meet the law's requirements.
With the online system mostly fixed, supporters of the law are hoping to turn around public opinion.
When it comes to the impact on jobs, "the big concerns that have been
raised by opponents of the Affordable Care Act amount to very little
because large employers already think it is in their best interest to
provide coverage to their workers," said Ron Pollack, executive director
of Families USA, a liberal advocacy group.
In other provisions announced Monday, the administration said:
- Companies will not face fines if they offer coverage to 70 percent of
their full-time employees in 2015, although they will have to ramp that
up to 95 percent by 2016. The law defines "full time" as people working
an average of 30 hours a week per month. That concession is expected to
help firms who have a lot of workers averaging right around 30 hours.
- Volunteer firefighters and others who give of their time will not be
considered employees for under the law. Some volunteer fire departments
worried they might have to shut down if forced to provide health
- Adjunct faculty members at colleges will be deemed to have worked 2
hours and 15 minutes for each hour of classroom time they are assigned
to teach. Officials said that means someone teaching 15 hours a week in
the classroom would be considered "full time" and eligible for coverage,
but someone teaching 12 hours may be considered part-time.
- A one-year delay in a requirement that employers offer coverage to
dependents of full-time workers. Companies that are working to meet the
goal will have until 2016 to comply.
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