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Controversial Obamacare "Pay or Play" Provisions
Delayed until 2015
In a surprise announcement, the U.S. Treasury Department announced on Tuesday that penalty assessments will not be imposed against employers covered by the Affordable Care Act (a/k/a Obamacare or ACA) who fail to provide sufficient health insurance to their employees in 2014, effectively giving covered employers another year to comply with the statute's requirements.
The move was announced via the "Treasury Notes" blog on the Treasury Department's website, authored by Assistant Secretary for Tax Policy Mark Mazur. Mazur explained that the decision to provide an additional year for compliance is based on widespread complaints from employers that more time is needed to effectively implement the complex requirements of the ACA, and the IRS, Department of Labor and Department of Health and Human Services regulations which implement it. He also indicated that the additional time can be used by these Agencies to simplify the regulations.
Notwithstanding Mazur's explanation, commentators have been quick to question whether the delay is motivated in part by politics. The delay assures that the imposition of penalty assessments against employers, and any economic repercussions that follow, will not occur until after the mid-term Congressional elections in 2014, and Republicans have made no secret of their intention to make opposition to the ACA a cornerstone of their campaign strategy.
Mazur also announced that the Department expects to publish regulations regarding employer and insurer reporting requirements later this summer, and that, once the new rules are issued, it will strongly urge employers to voluntarily implement this information reporting in 2014, in preparation for full application of the provisions in 2015.
If you have any questions about the matters discussed in this issue of Compliance Matters, you may contact any member of the Firm. We are reachable at 818-508-3700 or www.brgslaw.com.
Richard S. Rosenberg
Founding Partner
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