Brokers who have scrambled for the past year to ensure their employer clients are compliant with the Affordable Care Act’s employer mandate, also known in the industry as the “pay or play” mandate, are scrambling once again, to take a deep breath.
For Mark Gaunya, principal at Borislow Insurance and EBA advisory board member, some of his new business clients were behind in preparations. “We have quite a few prospects that need our assistance and time was running short to help all of them,” Gaunya says. “Perhaps now with the delay, we will be able to help more of them and maybe, just maybe, make some tweaks to the law to make it less painful and irrationally tilted toward government over reach.”
Business groups are also feeling relief today after the White House on Tuesday, in a blog posting from Valerie Jarrett, senior advisor to the president, announced it will suspend for one year reporting requirements in 2014 for larger employers to demonstrate compliance with a mandate to offer employees health insurance coverage. Financial penalties for larger employers that fail to comply are part of this delay, one year later than authorized in the ACA.
"We applaud the Obama Administration's decision … This provides vital breathing room to implement the law in a more thoughtful and administrable way," James A. Klein, president of the American Benefits Council, said in a statement regarding the U.S. Treasury Department’s confirmation of the news Tuesday evening.
Jarrett’s post continued with a nod to the White House’s communication with such business groups. “As we implement this law, we have and will continue to make changes as needed,” Jarrett said. “In our ongoing discussions with businesses we have heard that you need the time to get this right. We are listening. So in response to your concerns, we are making two changes.
Most large employers are already offering health coverage, says John Garven, president of Benico Limited, a benefit adviser in the Chicago area. He adds that they planned to continue before the delay, and will after and that this delay will mostly help smaller business owners or those employers in high turnover, low-wage industries that weren’t offering coverage already.
“A lot of our clients are in the hospitality industry and don’t offer coverage and they were preparing to do something and now there’s one year relief … my sense is that they’ll divert a year,” Garven says. “I imagine there will be additional guidance on this and I think this next time around these clients will be even more prepared and hopefully less confused.”
Joseph Goedert, reporter with Health Data Management, a SourceMedia publication, contributed to this report.
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