Friday, July 18, 2014

Media Coverage Catching Up - Employer Mandate Once Again on Thin Ice

We've been covering this topic here for nearly 13 months. PPACA's employer mandate is not going to be implemented as it was written. And even after two delays, I don't believe it will be implemented as it currently stands. There will be anther alteration somehow, someway.

The below is an excellent summary of the technical reasons for delay as well as a catalog of prominent Reform supporters who are now casting aspersions on the mandate. But it does not take into account the single most important reason for the delay: it's devastating impact on employment. It is a tax on employees working more than 30 hours a week. See more on that here and here.

This is from Elise Viebeck and Benjamin Goad writing for The Hill in a story just released today:

The White House needs to make a decision soon on whether ObamaCare's controversial employer mandate will take effect in 2015.

With the mandate set to take effect in January, businesses are awaiting final world from the administration on whether they will be required to track and report how many of their employees are receiving coverage.

Federal officials are late in delivering the final forms and technical guidance necessary for firms to comply, raising suspicions the mandate could once again be delayed. 

The mandate has been pushed back twice before, the first time in late summer. ...

Another delay to the mandate would be sure to create a political firestorm and draw charges that the administration is playing politics with ObamaCare ahead of the midterm elections.

But support for the mandate on the left has begun to soften in recent months, with influential figures and former Obama administration officials questioning whether it’s needed to make the law work.

Seven business lobbyists interviewed by The Hill said it is unlikely the administration would defer the employer mandate wholesale one more time, given the intense political pressure from Republicans.

But many groups are expecting partial relief to be announced prior to November, perhaps in the form of looser reporting requirements that would be easier to follow. ...

Almost one year ago, the Obama administration announced it would postpone enforcement of the mandate until 2015.

The move was denounced as politically driven, given that businesses were warning they were likely to layoff and cut hours for workers once they were required to either provide healthcare coverage or pay a fine.  

That same threat still exists today.  As we get closer to the November elections the pressure will mount for Reform supporters to delay or change the mandate again. While our economy has been adding jobs it has been via a reduction in full time work and a larger increase in part time employment.  Employers have a new financial incentive to move employees below 30 hours a week and to keep from growing past 50 employees to avoid these implicit taxes.

Viebeck and Goad continue:

... Interest groups say they're in a holding pattern until the Treasury Department releases two more forms and a set of specific enforcement guidelines.

Those materials, expected prior to July 4, are considered necessary to constructing databases that will help fulfill the mandate's complex requirements.

The Treasury Department says the documents will be ready soon and noted it released final regulations on the mandate in February.

"These forms will be made available in draft form in the near future," said a spokesman for the IRS.

Since that month, however, a growing number of Democrats have muddied the waters by questioning how much the mandate really matters to the healthcare law.

Skeptics include the party’s likely 2016 standard-bearer, Hillary Clinton, and former Obama spokesman Robert Gibbs.

Rep. Henry Waxman (D-Calif.), who helped craft the healthcare law, said he was "concerned" about the potential for lost revenue if the mandate is scrapped.

But he said another delay would not doom the healthcare law. "I don’t think it would be disastrous," he said. "It wasn't disastrous last year." ...

Away from the public debate, the lobbying battle over the administration's final decision is heating up.

Business groups are airing concerns about the missing forms on Capitol Hill and in "quiet conversations" with administration officials.

Some of the groups are proposing that the administration scale back the 2015 penalties for failing to comply. Others say that a form of self-verification should suffice for reporting which employees have healthcare coverage.

Lobbyist Yvette Fontenot, who helped draft the employer mandate as an aide to former Senate Finance Committee Chairman Max Baucus (D-Mont.), said the administration should explore its options.

"We didn’t have a very good handle on how difficult operationalizing the provision would be at that time,” said Fontenot, who is now a partner at government affairs firm Avenue Solutions.

"I don't have any doubt that there are other approaches … that make some sense in ensuring employers pay their fair share."