More on “Employer Mandate Delayed!”

Now that the dust has somewhat settled on last week’s exciting (and interestingly timed) announcement delaying the Affordable Care Act’s so called “employer mandate” (see also “pay or play”; and “employer shared responsibility), let’s examine some of the fallout.
  • Technically speaking, the mandate itself was not delayed, but rather, the employer reporting aspect of the law.  However, in effect, delayed reporting = delayed mandate.
  • Once the seemingly universal exuberance over the announcement began to dissipate, the questions from policy wonks and stakeholders began to fly.  The most significant question being – “how will the health insurance exchanges/marketplaces verify subsidy eligibility without knowing what an applicant’s employer plan’s status is, relative to affordability and coverage”?
  • The answer to the aforementioned question arrived from the Treasury department, in a 606-page document indicating – “all subsidy verification would rely on self-reporting until 2015.”  In effect, this means people can just apply and they may be at 400% of poverty level, they may be 50%, whatever they report is whatever goes through.  Hmmmm.
  • Benefits firm Mercer issued a statement Monday (July 8, 013) pertaining to the subsidy loophole which pointed to even more potential confusion. “Public exchanges, which are slated to be operational in 2014, may still reach out to employers to verify applicant eligibility for health insurance,” the statement said. “It will be state by state, and it’s just going to be part of your tax return”.
  • And lastly…the delay in the implementation of the employer mandate results in a significant loss of planned funding for the ACA.  In fact, the Congressional Budget Office had estimated that the penalties from employers would add up to approximately $10 billion in 2014.

Stay tuned folks.  There’s definitely going to be more to follow!