The Herald Bulletin

Morning Update

Nation & World

July 2, 2013

Obama administration delays major requirement of health law

WASHINGTON — In a major concession to business groups, the Obama administration Tuesday unexpectedly announced a one-year delay, until after the 2014 elections, in a central requirement of the new health care law that many companies provide coverage for their workers or face fines.

The move sacrificed timely implementation of President Barack Obama's signature legislation but may help the administration politically by blunting an election-year line of attack Republicans were planning to use. The employer requirements are among the most complex parts of the health care law, which is designed to expand coverage for uninsured Americans.

"We have heard concerns about the complexity of the requirements and the need for more time to implement them effectively," Treasury Assistant Secretary Mark Mazur said in a blog post. "We have listened to your feedback and we are taking action."

Business groups were jubilant. "A pleasant surprise," said Randy Johnson, senior vice president of the U.S. Chamber of Commerce. There was no inkling in advance of the administration's action, he said.

"We commend the administration's wise move," said Neil Trautwein, a vice president of the National Retail Federation. It "will provide employers and businesses more time to update their health care coverage without threat of arbitrary punishment."

But the delay could also undermine the law's main goal of covering the nearly 50 million Americans without health insurance. Already, Republican resistance in the states will deny access to a planned Medicaid expansion — at least for next year — to millions of low-income people.

Under the health law, companies with 50 or more workers must provide affordable coverage to their full-time employees or risk a series of escalating tax penalties if just one worker ends up getting government-subsidized insurance. Originally, that requirement was supposed to take effect Jan. 1. It will now be delayed to 2015.

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