The Obama Administration announced that it will delay the implementation of the “Employer Mandate” provision in the new health care law by one year. Under the newly announced policy, the Internal Revenue Service (IRS), which enforces this provision of the law, will not fine clubs for failing to comply with the Employer Mandate until 2015.
The Obama Administration announced that it will delay the implementation of the “Employer Mandate” provision found in the new health care law by one year, a release from the National Club Association reported.
The news was released by the Department of the Treasury and Valerie Jarrett, a Senior Advisor to President Obama, who hailed it as proof that the Administration is listening to the concerns of the small business community.
The Employer Mandate requires clubs with 50 or more combined full-time and full-time equivalent employees to offer health insurance to all employees who work 30 or more hours per week. If a club fails to do this, then it will be fined $2,000 per employee (minus the first 30 employees). If a club offers health insurance, but the plan is deemed “unaffordable” or does not meet government requirements, the club will be fined $3,000 for each employee who goes to the Exchange and receives a subsidy to help purchase health insurance.
Before the announced delay, the Employer Mandate was set to begin January 1, 2014 or the first day of a club’s 2014 plan year, whichever was later. Under the newly announced policy, the Internal Revenue Service (IRS), which enforces this provision of the law, will not fine clubs for failing to comply with the Employer Mandate until 2015.
What does this delay mean for a club that currently offers insurance?
1. Your club will not be fined for failing to offer insurance to employees working 30-39 hours per week from now until the first day of the 2015 plan year.
2. Your club will not be fined for offering “unaffordable” insurance to your employees from now until the first day of the 2015 plan year.
3. Your club will not be fined for offering insurance that fails to meet the government requirements from now until the first day of the 2015 plan year.
What does this delay mean for a club that currently does not offer insurance?
1. Your club will not be fined for failing to offer health insurance to employees working 30 or more hours per week from now until January 1, 2015.
This new policy also delays for one year the requirement for clubs to file an “information return” with the IRS and for their employees to provide specific information regarding the insurance they were offered in 2014. Those information returns were to be filed in 2015, and will now need to be filed in 2016 based on information gathered in 2015.
It is expected that the IRS will issue new regulations that detail the announced delay within the next few weeks.
NCA and the Small Business Coalition for Affordable Healthcare have been pushing for a complete repeal of the Employer Mandate since its enactment.
To learn more about all aspects of the new law, join NCA Vice President of Government Relations and General Counsel Brad D. Steele on Mondays at 4:00 ET for weekly Health Care Town Hall meetings. These informative discussions give you a chance to hear from one of the industry’s leading experts on health care reform legislation, learn from the concerns of fellow club leaders, and ask questions about your club’s implementation of the new healthcare law. There is no charge from NCA to join the call; however, standard phone charges may apply. See http://www.nationalclub.org/education/town_halls for more information.
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