What does the Obamacare delay mean?

In recent weeks and months, many businesses and school districts both inside and outside Utah began cutting employee hours in order to avoid paying fines that Obamacare would require for businesses with more than 50 employees that do not offer health coverage, beginning in 2014. But in an unexpected announcement from the Obama administration, those employees and their employers may be catching a break … at least for a year. All other aspects of the law that have not already been modified by executive action will continue to be implemented on schedule (unless the administration decides otherwise, of course).

So what does this announcement mean for the Obamacare law? At this stage, nothing is for certain, but here are a few opinions on the matter:

The cost of Obamacare to taxpayers will likely increase. Because the “employer mandate” was the primary incentive employers had for providing health care coverage under Obamacare, many businesses will likely hold off on providing coverage for at least a year. But the health care exchanges – and the taxpayer-funded subsidies for health care coverage that come with them – will still be launched this fall. The likely result will be that many who would have gotten health insurance from an employer under the employer mandate will instead be subsidized in the exchanges, increasing the cost to taxpayers. 

Lawsuits may occur. Obamacare explicitly states that the employer mandate must go into effect beginning in 2014, which raises the question of whether the Obama administration can legally delay its implementation. There is a fair chance that some activists, with a few citizens who are harmed by the higher cost of health insurance expected in the exchanges, file a lawsuit to force the federal government to implement the employer mandate.

The politics of Obamacare will go on, and on, and … The political right is talking about how the delay illustrates the fundamental flaws with Obamacare. The political left is talking about how it means the administration is committed to doing implementation right. The political right says it means that the uncertainty and public concern surrounding the law will only go on longer. The political left says it means that Democrat politicians will not have to deal with the political harm the employer mandate would have done going into the 2014 elections. Whatever the outcome of this most recent development in the never-ending Obamacare drama, the politics of it will be with us for the foreseeable future.

Higher costs to taxpayers, lawsuits, and more politics. In other words, the most recent development suggests more of the same from the Obamacare law.

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One Response to What does the Obamacare delay mean?

  1. RD Hunt says:

    “Utah began cutting employee hours in order to avoid paying fines that
    Obamacare would require for businesses with more than 50 employees that
    do not offer health coverage”

    This is a horrible misunderstanding of the law, the employer mandate is measured by FTE(full time equivalent) not FT(full time) employees.

    Basically each full time employee is 1 FTE regardless of how many hours they work, and the hours of all part time employees are added up and divided by 30 to find the number of FTE’s per week.

    The fine is only paid for over 50 and not upto, so at 51 FTE’s you don’t suddenly have a huge extra expense.

    And the fine is only applied to employers that don’t offer a qualifying health plan(and actually most employers over 50 employees already do so it doesn’t effect that many people).

    How the employer mandate works has been communicated very poorly. Hopefully Obama will use this extra year to communicate how it actually works, and maybe work with congress to change the FTE rule for part timers to 40 hours, this would amount of a reduction of the employer mandate tax applied to employers without a qualifying plan(about $2050~ per year)

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