16 June 2019

The Obamacare Employer Mandate Loses Supporters

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When President Obama signed the Affordable Care Act, its requirement that large employers provide health coverage or pay a penalty seemed to many supporters a key pillar of the effort to guarantee health coverage to Americans. Four years later and after repeated delays, the employer mandate has become something of an orphan, reviled by the law's opponents and increasingly seen as unnecessary by many of its supporters.

Twice in the last two years, the Obama administration has put off the penalties, citing difficulties enforcing the mandate. House Republicans plan to sue the president, largely over his suspension of the mandate, saying he has broken the law by failing to enforce a requirement that they bitterly oppose. The House could vote to approve the lawsuit as early as this week.

The employer mandate is designed to prevent businesses from dropping health benefits now that the government provides subsidies to help low- and moderate-income Americans buy coverage.  Large employers that do not provide insurance are supposed to pay a fine — called an employer responsibility payment — of $2,000 per employee above the first 30 employees. Employers may be subject to even bigger fines if their employees cannot afford the coverage offered at work and then qualify for government subsidies to buy coverage on their own.

But over time, the mandate has drawn increasing criticism, even from the law's supporters. Support for the employer mandate has faded in part because employers have continued to offer benefits, even without a penalty. In fact, recent surveys have suggested that there has been a gain in employer-based insurance this year.

The institute recently concluded in a study that dropping the mandate would have a minimal effect on insurance coverage nationally. Health law supporters nonetheless caution against scrapping the mandate altogether, noting that it may become a more important tool if more employers drop coverage or if workers can't find affordable insurance on their own. There is little chance, however, that the employer mandate will be repealed any time soon.

The mandate directly affects only a small slice of Americans. The health law has always exempted businesses with fewer than 50 full-time employees, which accounts for about a quarter of the U.S. workforce. The vast majority of larger businesses already provide coverage: 99% of employers with more than 200 workers offer health benefits, according to an annual survey by the nonprofit Kaiser Family Foundation and the Health Research & Educational Trust. But the additional reporting requirements integral to the mandate have made it deeply unpopular with business groups.

Even supporters of the law acknowledge that because the requirement applies only to employers with 50 or more full-time workers, it creates an incentive for employers to move some people to part-time work.

Neither the president nor Senate Democratic leaders have signaled any interest in reopening debate about the provision. Unless the Obama administration delays them further, the penalties are scheduled to go into effect next year on employers with more than 100 workers. The administration plans to impose penalties on employers with more than 50 full-time workers beginning in 2016.

Click here to access the full article on LA Times. 

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