The Obama administration’s decision to delay implementation of the employer mandate of the Patient Protection Affordable Care Act until 2015 unleashed a new round of criticism from conservative lawmakers but was welcomed by some of the biggest names in benefits and insurance.
House Energy and Commerce Committee Chairman Fred Upton, R-Mich., said “the administration's sudden turnabout is a clear admission that its signature law is bad for business and bad for jobs. This law will never be ready for prime time and sadly, the administration's acknowledgement that it still needs yet another year clearly disrupts everyone's ability to determine what is best for them and their business."
Brokers said this delay will have consequences for the private marketplace.
“No doubt this is a huge capitulation by the administration, consistent with getting ahead of the potential politics of a messy implementation,” said Joel Wood of the Council of Insurance Agents & Brokers.
“Our members have mixed emotions about this. They’ve invested an astonishing amount of resources in running the pay-or-play scenarios for their clients and preparing for January. Those who haven’t prepared their clients will revel in the news, and conservatives will sense blood in the water. On the other hand, the mandate drives up the cost of labor; perhaps this is a modest mitigation,” Wood said.
The American Benefits Council, meanwhile, welcomed the delay.
"This provides vital breathing room to implement the law in a more thoughtful and administrable way," said James A. Klein, president of the trade organization.
"Major employers have led the way in providing coverage to their workers and are expending great resources to ensure compliance with the new law. This relief will minimize disruption for employers and their workers," Klein said.
The National Association of Life Underwriters issued a statement from NAIFA President Robert Smith, who also applauded the move:
"NAIFA was pleased the administration is responding to the concerns of employers and is delaying for one year the employer mandate requiring companies to offer their employees health insurance," he said.
The National Business Group on Health, a non-profit association of more than 360 large U.S. employers, also welcomed the news.
“This is terrific news for large employers all across the country,” said Helen Darling, president and CEO of the organization. “The one-year delay will give employers much needed additional time to make any necessary changes to their health care benefit programs and any other decisions to meet the law’s requirements. It also gives employers relief from yet-to-be fully worked out reporting requirements and the administrative burdens of complying with a complex set of rules.”
Steve Wojcik, the group’s vice president of public policy, questioned whether delays to other provisions in the law might loom.
“Most large employers are well into finalizing benefit changes and plans for 2014. It may mean a temporary pause for some, for others it may mean no change in their plans for 2014.”
Republicans said the delay was further evidence that the law will cost jobs and increase health care costs.
"This announcement means even the Obama administration knows the 'train wreck' will only get worse," said House Speaker John Boehner, R-Ohio. "This is a clear acknowledgment that the law is unworkable, and it underscores the need to repeal the law and replace it with effective, patient-centered reforms."
Sen. Orrin Hatch, R-Utah, the ranking member of the Senate Finance Committee, said the fact that the administration was not also giving individuals or families a one-year extension from coverage requirements "shows how deeply flawed the president's signature domestic policy achievement is."