Reuters: U.S.: U.S. to delay key health-reform provision to 2015

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U.S. to delay key health-reform provision to 2015 Jul 3rd 2013, 01:44 A patient waits in the hallway for a room to open up in the emergency room at Ben Taub General Hospital in Houston, Texas, July 27, 2009. Credit: Reuters/Jessica Rinaldi By David Morgan WASHINGTON | Tue Jul 2, 2013 8:26pm EDT WASHINGTON (Reuters) - The Obama administration on Tuesday said it will not require employers to provide health insurance for their workers until 2015, a move that delays a key provision of President Barack Obama's healthcare reform law by a year, and past the next election. The delay, which quickly raised questions about the future of other Obamacare provisions including its mandate for individuals, follows widespread complaints from businesses and their lobbyists about reporting requirements for employers with 50 or more full-time workers. Retailers and other businesses interests welcomed the change, which analysts said could stymie a main avenue of political attack on Obama's signature domestic policy achievement as campaigning for the 2014 midterm Congressional election gets under way. Republicans called it evidence that Obama's plan was a failure. Companies would have had to pay the Internal Revenue Service $2,000 for each full-time employee who did not get health coverage, beginning January 1, when the Patient Protection and Affordable Care Act is scheduled to come into full effect. "This is designed to meet two goals," Mark Mazur, the Treasury Department's assistant secretary for tax policy, said in a government blog. "It will allow us to consider ways to simplify the new reporting requirements consistent with the 2010 law. Second, it will provide time to adapt health coverage and reporting systems while employers are moving toward making health coverage affordable and accessible." He said the administration will publish formal guidance describing the changes within the next week. Some analysts saw the change as a responsible move to accommodate smaller businesses. But Republican criticism is expected to rise sharply ahead of the elections that will determine the partisan makeup of Congress in the final two years of the Obama presidency. "It takes away one of the potential sources of criticism and frankly negative stories that were likely to materialize in the fall," said Larry Levitt of the nonpartisan Kaiser Family Foundation, which tracks healthcare issues. Trade groups representing retailers and restaurants, among those expected to be hit hardest by the mandate, welcomed the one-year extension. "We commend the Administration's wise move," said National Retail Federation Vice President Neil Trautwein. "This one-year delay will provide employers and businesses more time to update their healthcare coverage without threat of arbitrary punishment." Republican lawmakers seized on the announcement as evidence the healthcare reform they have repeatedly sought to repeal represents a flawed administration policy. House of Representatives Speaker John Boehner said the administration should now provide relief individuals who face a penalty if they do not obtain health coverage by 2014. The so-called individual mandate will begin next year at $95, or 1 percent of taxable household income and rise in phases to $695 per person, with a cap of 2.5 percent of household income, by 2016. "This is a clear acknowledgment that the law is unworkable, and it underscores the need to repeal the law and replace it with effective, patient-centered reforms," Boehner said in a statement. The administration has already delayed insurance offerings for small businesses that were to be made available through new online exchanges. A recent report by the watchdog Government Accountability Office also called into question whether new insurance marketplaces for millions of individuals would meet an October 1 deadline for open enrollment. But Valerie Jarrett, a senior adviser to Obama, said in a blog post on Monday that the government was fully prepared to open the new insurance exchanges for individuals in October. While the nation's largest employers already offer extensive health benefits to their full-time employees, many small and mid-sized companies will now be required to provide insurance for the first time. But Tuesday's delay also raised questions about initial funding for Obamacare. The employer mandate is expected to raise $140 billion in revenues over the next 10 years, according to the nonpartisan Congressional Budget Office. CBO estimates the individual mandate will bring in another $45 billion. (Additional reporting by Alina Selyukh, Patrick Temple-West and Toni Clarke in Washington, and Jessica Wohl in Chicago,; editing by Michele Gershberg and Prudence Crowther) Link this Share this Digg this Email Reprints

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