White House Delays Key Element Of Health Care Law

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WASHINGTON
(AP) — President Barack Obama's health care law, hailed as his most
significant legislative achievement, seems to be losing much of its
sweep.

On Tuesday, the administration
unexpectedly announced a one-year delay, until after the 2014 elections,
in a central requirement of the law that medium and large companies
provide coverage for their workers or face fines.

Separately,
opposition in the states from Republican governors and legislators has
steadily undermined a Medicaid expansion that had been expected to
provide coverage to some 15 million low-income people.

Tuesday's
move – which caught administration allies and adversaries by surprise -
sacrificed timely implementation of Obama's signature legislation but
might help Democrats politically by blunting an election-year line of
attack Republicans were planning to use. The employer requirements are
among the most complex parts of the health care law, designed to expand
coverage for uninsured Americans.

“We have
heard concerns about the complexity of the requirements and the need for
more time to implement them effectively,” Treasury Assistant Secretary
Mark Mazur said in a blog post. “We have listened to your feedback and
we are taking action.”

Business groups were
jubilant. “A pleasant surprise,” said Randy Johnson, senior vice
president of the U.S. Chamber of Commerce. There was no inkling in
advance of the administration's action, he said.

“We
commend the administration's wise move,” said Neil Trautwein, a vice
president of the National Retail Federation. It “will provide employers
and businesses more time to update their health care coverage without
threat of arbitrary punishment.”

But the delay
could also whittle away at the law's main goal of covering the nearly
50 million Americans without health insurance.

Liberals
immediately raised concerns. Will employees be able to get
taxpayer-subsidized individual coverage through new health insurance
markets if their company does not offer medical benefits? Uninsured
people can start signing up Oct. 1 for the new individual policies.

“If
the administration is going to give employers a break, it should not do
that at the expense of millions of uninsured or underinsured workers
who have been looking to have health insurance available to them on Jan.
1, 2014,” said Richard Kirsch, a senior fellow with the Roosevelt
Institute in New York, a think tank dedicated to promoting progressive
policies.

Under the health law, companies with
50 or more workers must provide affordable coverage to their full-time
employees or risk a series of escalating tax penalties if just one
worker ends up getting government-subsidized insurance. Originally, that
requirement was supposed to take effect Jan. 1, 2014. It will now be
delayed to 2015.

Most medium-sized and large
business already offer health insurance and the mandate was expected to
have the biggest consequences for major chain hotels, restaurants and
retail stores that employ many low-wage workers. Some had threatened to
cut workers' hours, and others said they were putting off hiring.

Business
groups have complained since the law passed that the provision was too
complicated. For instance, it created a new definition of full-time
workers, those who put in 30 hours or more. It also actually included
two separate requirements, one to provide coverage and another that it
be deemed “affordable” under the law. Violations of either one exposed
employers to fines. But such complaints until now seemed to be going
unheeded.

There is no coverage requirement -
or penalty – for smaller businesses. Also, for businesses of any size,
there is no penalty if their workers are poor enough to be eligible for
Medicaid.

The delay in the employer
requirement does not affect a provision in the law that requires
individuals to carry health insurance starting next year or face fines.
That so-called individual mandate was challenged all the way to the
Supreme Court, which ruled last year that the individual requirement was
constitutional since the penalty would be collected by the Internal
Revenue Service and amounted to a tax.

Tuesday's action could provide cover for Democratic candidates in next year's congressional elections.

The
move undercuts Republican efforts to make the overhaul and the costs
associated with new requirements a major issue in congressional races.
Democrats are defending 21 Senate seats to the Republicans' 14, and the
GOP already had begun to excoriate Senate Democrats who had voted for
the health law in 2009.

Senior White House adviser Valerie Jarrett cast the decision as part of an effort to simplify data reporting requirements.

She
said since enforcing the coverage mandate depends on businesses
reporting about their workers' access to insurance, the administration
decided to postpone the reporting requirement, and with it, the mandate
to provide coverage.

“We have and will
continue to make changes as needed,” Jarrett wrote in a White House blog
post. “In our ongoing discussions with businesses we have heard that
you need the time to get this right. We are listening.”

Republicans called it a validation of their belief that the law is unworkable and should be repealed.

“The
president's health care law is already raising costs and costing jobs.
This announcement means even the Obama administration knows the `train
wreck' will only get worse,” House Speaker John Boehner, R-Ohio, said in
an email. “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.”

(Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)

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