Employer Mandate Delay Offers Opportunity to Make an Informed Decision Surrounding Health Reform

The Treasury Department recently announced that enforcement of the Affordable Care Act employer mandate (which requires employers with more than 50 full-time equivalent employees to provide affordable health insurance coverage or pay defined penalties) will be delayed from its original deadline of Jan. 1, 2014, to Jan. 1, 2015. The 12-month delay also applies to reporting requirements for employers to provide information on health insurance coverage, who obtains the coverage and what is offered to employees.

Mark Mazur, treasury assistant secretary, said the postponement in enforcement should allow time for the government to consider ways to simplify the new reporting requirements and adapt health coverage and reporting systems.

The Treasury announcement did NOT mention a delay for the individual mandate to purchase health insurance as of Jan. 1, 2014.

With the delay, employers have some time to understand how health care reform will affect key components of their business. Those implications can be summarized in three areas:

Compliance

• IRS Tax Filings (fees, information returns)
• Insurance Reforms (no limits, pre-existing conditions, grandfathering, nondiscrimination)
• Required Notifications (Exchange notification)

Financial

• Pay or Play Analysis (Employer Health Reform Analytics)
• Measurement Period Analysis (Employee Classification Safe Harbor)
• Employee Benefit Design Impacts

Strategic

• Employee Benefit Design
• New to market Employee Benefit Options
• Workforce Planning

Eide Bailly's National Tax Office serves as a resource for clients to help analyze complex tax issues related to business decisions. Our professionals are committed to helping clients stay informed about tax news, developments and trends through various specialty areas, including cost segregation studies, wealth transfer, state and local taxation, international tax, tax exempt organizations and tax legislation.