On July 2, 2013, the United States Department of Treasury announced in a blog post that the Obama administration will delay key provisions of the Affordable Care Act. The postponement will delay the employer shared responsibility payment requirements under Code Section 4980H until 2015. The result of this delay is that employers of 50 or more full-time equivalent employees (those working 30 or more hours per week) have another year before they will incur penalties for failure to provide health insurance.
According to a Treasury official, the rules are being delayed because of the difficulty businesses have been facing trying to implement the law. During the one year delay, the administration hopes to simplify the reporting requirements, and give employers more time to prepare for compliance.
While the reprieve is a welcome one, employers are by no means off the hook. This move simply delays the penalty for failure to comply with the “employer mandate” for 12 months. It is expected that more formal guidance from the Treasury Department will be issued shortly.