Administration Delays Obamacare Employer Mandate


The delay of a major health reform provision means that employers won't be required to offer their workers health insurance next year. The complex and unpopular Obamacare requirement will not be implemented in 2015, after next year's election, the Treasury Department announced on Tuesday.

The decision is a relief to employers, which have been struggling to prepare for a series of new requirements next year. Under the health reform law, any business with 50 or more full-time workers would need to provide affordable health insurance to its workers or pay a fine. But the rules were complicated, and even businesses that currently insure their workers were complaining it would be tough to comply.

"We have listened to your feedback," Mark Mazur, the assistant secretary for tax policy wrote on the Treasury website. "And we are taking action."

Politically, the decision cuts both ways. The employer mandate was never very popular among business owners, especially in the retail and restaurant sector. This decision placates them for now and undercuts criticism that the law hobbles business.

But the delay, originally reported by Bloomberg, also allows Obama's critics to allege that the administration is falling down on the job of administering its health reform law. Christopher Jacobs, a senior policy analyst at the conservative Heritage Foundation, quickly posted on the organization's blog that the administration now "admits Obamacare's a job-killer."

It also does little to appease the Affordable Care Act's most determined political critics. House Majority Leader Eric Cantor, R-Va., didn't hesitate to use the news to renew calls for repeal. "This further confirms that even the proponents of ObamaCare know it will hurt jobs, decrease economic growth and make it harder for families to have access to quality and affordable health care. Rather than continuing to delay the predictable pain until another election day has passed, we should scrap this entire law and instead implement patient-centered reforms before any more damage is done to our economy or the health care families depend on," he said in a statement. House Speaker John Boehner's statement said the move was "a clear acknowledgement that the law is unworkable."

But despite the rhetoric, the practical effects of the delay may not be large. A 2010 RAND analysis of the employer mandate found that the provision would influence the behavior of very few employers. Most large employers already offer their workers insurance. And many who expanded coverage would do so in response to employee demand, not the fear of penalties, the study found.

"The employer mandate didn't end up having much "bite," says Christine Eibner, a RAND economist who worked on the analysis.

The law's biggest features will still roll out on time. Administration offiicals continue to say that new insurance marketplaces will be ready for people to sign up as scheduled on Oct. 1. And just last week, the administration issued its final rule on the requirement that individuals obtain health insurance, which means the law's most unpopular provision will kick in next year.

(Image via lenetstan/

Stay up-to-date with federal news alerts and analysis — Sign up for GovExec's email newsletters.
Close [ x ] More from GovExec

Thank you for subscribing to newsletters from
We think these reports might interest you:

  • Forecasting Cloud's Future

    Conversations with Federal, State, and Local Technology Leaders on Cloud-Driven Digital Transformation

  • The Big Data Campaign Trail

    With everyone so focused on security following recent breaches at federal, state and local government and education institutions, there has been little emphasis on the need for better operations. This report breaks down some of the biggest operational challenges in IT management and provides insight into how agencies and leaders can successfully solve some of the biggest lingering government IT issues.

  • Communicating Innovation in Federal Government

    Federal Government spending on ‘obsolete technology’ continues to increase. Supporting the twin pillars of improved digital service delivery for citizens on the one hand, and the increasingly optimized and flexible working practices for federal employees on the other, are neither easy nor inexpensive tasks. This whitepaper explores how federal agencies can leverage the value of existing agency technology assets while offering IT leaders the ability to implement the kind of employee productivity, citizen service improvements and security demanded by federal oversight.

  • IT Transformation Trends: Flash Storage as a Strategic IT Asset

    MIT Technology Review: Flash Storage As a Strategic IT Asset For the first time in decades, IT leaders now consider all-flash storage as a strategic IT asset. IT has become a new operating model that enables self-service with high performance, density and resiliency. It also offers the self-service agility of the public cloud combined with the security, performance, and cost-effectiveness of a private cloud. Download this MIT Technology Review paper to learn more about how all-flash storage is transforming the data center.

  • Ongoing Efforts in Veterans Health Care Modernization

    This report discusses the current state of veterans health care


When you download a report, your information may be shared with the underwriters of that document.