I recently discussed how new health care laws will affect your business in 2014. However, the White House recently announced that it is postponing the Patient Protection and Affordable Care Act’s (PPACA) (P.L. 111-148) mandatory employer and insurer reporting requirements. Instead of starting on January 1, 2014, the reporting requirements, mandated by the act, would not begin until January 1, 2015.
Less than six months prior to the full implementation of the sweeping health care reform act, the Treasury Department admitted that, for many employers and insurers otherwise subject to the new mandates, the rules for compliance are complex and could not be implemented by 2014. The announcement explained that, “we have heard concerns about the complexity of the requirements and the need for more time to implement them effectively.”
The Treasury Department has promised to publish formal guidance shortly that will describe the transition that will be taking place from mandatory 2014 reporting to a voluntary system for 2014. The Treasury Department also expects to publish revised information reporting rules for insurers, self-insuring employers and other parties that provide health care coverage. The Treasury Department is encouraging employers that now provide health insurance to voluntarily implement information reporting under these revised rules in order to test their systems before mandatory reporting comes into force in 2015.
As a result of not obtaining the reporting information in 2014, the White House also announced that it will waive the imposition of any employer penalties until 2015. This effectively means that large employers, those defined as having more than 50 full-time equivalent employees, will not be penalized for failing to provide health insurance to their employees until 2015. The announcement did not address the individual mandate that goes into effect in 2014 and requires most individuals to obtain health insurance or pay a penalty. Nor does it delay implementation of marketplace exchanges that are set to go live on October 1, 2013.
Written by Phoenix Tax Controversy Attorney Shad Brown