Delay of employer penalties will cost government $10B
Tuesday, July 30, 2013
WASHINGTON (AP) — The Obama administration’s surprise decision to delay a key requirement of the health care law for employers will cost the government $10 billion, the nonpartisan Congressional Budget Office said Tuesday.
While that’s a big number, the report from the official budget scorekeeper for Congress put the administration’s recent move within a wider perspective: It adds up to an increase of less than 1 percent in the 10-year cost of the law.
Earlier this month, the White House announced earlier that it would delay a health law requirement for employers with 50 or more workers to offer affordable coverage, or face fines. Instead of going into effect next year, the provision was put off to 2015. A major concession to business groups, the delay took administration allies and adversaries by surprise.
Opponents of the health care law saw the delay as a sign that the law’s implementation had run into serious problems, and some labor unions denounced it as a handout to big business. But employers welcomed the unexpected respite from complicated reporting rules that the administration concedes will require more time to work out. The White House says the rest of the law’s provisions will roll out without delay.
Uninsured people without access to coverage at work will be able to start shopping for a health plan Oct. 1. Middle-class people will be able to pick from a range of private insurance plans, with new federal tax credits to help pay their premiums. Low-income people will be steered to an expanded version of Medicaid, in states that accept it. Coverage takes effect Jan. 1.
At the same time, most Americans will face an individual requirement to carry health insurance or pay fines. That’s designed to expand the number of healthy people in the pool, since the law forbids insurers from turning away people with pre-existing health problems.
All told, about 13 million of nearly 50 million uninsured U.S. residents are expected to gain coverage in 2014, according to the latest CBO estimates. That number is expected to gradually increase to between 25 million and 30 million people.
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