Obamacare Mandate for Medium Sized Employers Delayed Until 2016

The Obama administration is giving certain employers extra time before they must offer health insurance to almost all of their full time workers.

Under new rules announced Monday by Treasury Department officials, employers with 50 to 99 workers will be given until 2016 (two years longer than originally envisioned under the Affordable Care Act) before they risk a federal penalty for not complying.

Companies with 100+ workers or more are getting a different kind of one-year grace period. Instead of being required in 2015 to offer coverage to 95% of full time workers, these bigger employers can now avoid a fine by offering insurance to at least 70% of workers next year.

Administration officials had already announced in July 2013 that the employer requirements would be postponed until 2015 and this recent announcement has caught officials by surprise.

Obama administration officials said the Treasury Department decided to allow medium-size businesses more latitude because “they need a little more time to adjust to providing coverage”.

The Affordable Care Act (ACA) states that anyone who works 30 hours or more is a full time employee, and it compels many employers to offer affordable insurance to those workers and their dependents. (Please note that Florida law currently defines a full time worker as anyone who works 25 or more hours). It also defines affordable as premiums of no more than 9.5% of an employee’s income, and employers must pay for the equivalent of 60% of the actuarial value of a worker’s coverage. Businesses that fail to do so will eventually face a fine of up to $2000 for each employee not offered coverage, though workers are not required to sign up for the benefits.

For questions on how these recent changes will affect your business or for help complying with the ever-changing ACA requirements, please contact our office.