Compensation & Benefits Alert - July 2013
In response to employers’ requests for more time to implement complex regulations regarding reporting requirements under the Affordable Care Act, the Obama Administration announced on Tuesday, July 2, 2013, a one-year delay in the effective date of a major component of the Act requiring employers with at least 50 workers to offer health coverage or be exposed to a penalty. The provision, commonly known as the “play or pay” penalty or employer mandate, will now become effective on January 1, 2015. Obviously, the delay removes the pressure to redesign plan coverage in the next few months to maximize the cost benefit of avoiding (or paying) the penalties. Employers now have an extra year to vet the pros and cons of their plan designs and to implement the Act’s requirements on coverage.