President Obama Postpones ACA “Shared Responsibility” Obligations

The goals of the Affordable Care Act are lofty, but the implementation of them has proven difficult.  Which is why President Obama announced that the so-called “shared responsibility” obligations under the ACA – which require certain employers to provide health care coverage to employees or pay a penalty — would be postponed by a year. 

Additionally, on July 5, the Administration changed the requirements regarding the process by which state online insurance marketplaces will verify income and eligible health coverage status for those applying for subsidized coverage.

What Is A “Shared Responsibility” Payment?

Under ACA’s “shared responsibility” section, employers with 50 or more full-time employees must offer health care coverage to all employees who work an average of 30 hours per week or more in a month, or pay penalties. This employer mandate was to go into effect on January 1, 2014.

The concept is simple enough, but the implementation proved far more difficult than the Obama Administration expected.  Ultimately, the government decided that it did not have the appropriate structures in place to handle the reporting requirements attendant to the mandate, so it postponed the requirement by a year until January 1, 2015.  The government also cited its interest in simplifying the obligations on employers, though it remains to be seen just how “simple” those obligations will be. 

- Dan Handman

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