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ObamaCare Clusterfuck: Obama to delay employer mandate for another year

Sheesh, twice now? LA Times:

The Obama administration again delayed a requirement that large employers provide their workers with health benefits, offering businesses more relief from the president's health law deadlines.

Under the law, employers with more than 50 full-time employees must offer affordable health benefits or pay fines, a requirement originally scheduled to go into effect this year but postponed until 2015.

Now, under Monday's action, the employer mandate will be phased in and won't fully take effect until 2016. The additional delay is likely to have little effect on employees because the vast majority of large employers already offer health benefits.

And fewer will have the benefits of coverage:

The Treasury Department also said Monday that employers subject to the mandate in 2015 will only need to cover 70 percent of workers to be in compliance with the law. The previous threshold was 95 percent, which officials said will now apply beginning in 2016 instead.

So, two postponements, really, not just one. And then there's this toothless provision:

Officials said that any business claiming they are eligible for the new one-year delay because they have fewer than 100 workers must certify, under penalty of perjury, that it had not reduced its workforce merely to qualify for that exemption.

Yeah, that'll protect worker #100, for sure! (Though, to be fair, I'd fire #99 and #98, too, not only pour encourager les autres, but also to make a better case to Obama's ruthless, yet fair, Justice Department MR SUBLIMINAL Bwa-ha-ha-ha-ha!!!.) More on enforcement:

The Obama administration doesn’t appear to have any stringent means of ensuring that employers don’t purposefully lay off workers or cut hours to avoid the employer mandate, but an administration official told reporters that employers will be required to check a box on tax forms verifying they have not done so.

(In reality, I don't think a lot of employers are going to fire employee #100; but the Obama administration's sloppiness and presumptions of who acts in good faith really tick me off.)

The new regulations also do other stuff, some of it sensible, assuming you consider ObamaCare sensible:

Among other things, they clarify that volunteers will not be counted as full-time employees, thereby sparing volunteer fire companies and others from having to pay fines if they do not offer benefits.

The rules also indicate that teachers and school employees will be considered full time, even if their schools are closed over the summer.

Neil Trautwein, vice president of the National Retail Federation, was among several business leaders who welcomed the new accommodations.

"We are quite pleased with the additional transitional relief," he said, noting that administration officials had "secured the gold medal for greatest assistance to retailers and other businesses and our employees."

A gold medal! Fancy that! Back at ya:

A senior administration official, who briefed reporters on the proposal on the condition of anonymity shortly before the rule became public, said the Treasury Department decided to allow medium-size businesses more latitude because they “need a little more time to adjust to providing coverage.”

Everybody gets "transitional relief" and "a little more time" except for the poor schlubs who actually have to buy ObamaCare's defective product!

* * *

To me, leaving aside the principle of the thing -- yet another random set of rules that sends some people to Happyville and others to Pain City -- the interesting question is this: Is the delay legal? This statement from the administration does not inspire confidence:

[A] senior official noted when asked what legal authority the administration had to give the year reprieve to smaller businesses, "We've done it in a bunch of other areas."

Alrighty, then. More formally, see this in The Atlantic from Simon Lazarus (from the Constitutional Accountability Center from July 2013, during the first round of delays:

Nor is the one-year delay of the employer mandate an affront to the Constitution, as Professor Michael McConnell and Congressional Republicans insist. The relevant text requires that the President "take care that the laws be faithfully executed." Scholars on both left and right concur that this broadly-worded phrasing indicates that the President is to exercise judgment, and handle his enforcement duties with fidelity to all laws, including, indeed, the Constitution. As McConnell himself notes, both Republican and Democratic Justice Departments have consistently opined that the clause authorizes a president even to decline enforcement of a statute altogether, if in good faith he determines it to be in violation of the Constitution. But, McConnell contends, a president cannot "refuse to enforce a statute he opposes for policy reasons." While surely correct, that contention is beside the point.

The Administration has not postponed the employer mandate out of policy opposition to the ACA, nor to the specific provision itself. Thus, it's misleading to characterize the action as a "refusal to enforce." Rather, the President has authorized a minor temporary course correction regarding individual ACA provisions, necessary in his Administration's judgment to faithfully execute the overall statute, other related laws, and the purposes of the ACA's framers. As a legal as well as a practical matter, that's well within his job description.

Sure, but what's "temporary" and what's "minor"? One year is temporary, but is two? How about three, to get us safely past the next Presidential election? Maybe changing 90% coverage to 75% is minor, but is 50%?*

The grounds for the delay a year ago were in tax law (and the fact that the mandate is a tax is what made ObamaCare constitutional, let us remember). Lazarus continues:

In effect, the Administration [explained the 2103] delay as a sensible adjustment to phase-in enforcement, not a refusal to enforce. On the contrary, Treasury's Mazur wrote to [House Energy and Commerce Committee Chair Fred] Upton, such temporary postponements of tax reporting and payment requirements are routine, citing numerous examples of such postponements by Republican and Democratic administrations when statutory deadlines proved unworkable.

Still true today. LA Times:

"The secretary has very broad authority to implement the tax law in a way that benefits tax administration," said a senior Treasury Department official who was not authorized to speak on the record. "We think the phase-in approach really is a way to administer the law better and enhance overall compliance."

All very well, unless you believe -- as I do -- that the ObamaCare marketplace approach is a template for services delivered by the market state. Imagine a Retirement Marketplace, with Social Security as the "public option," enforced with a mandate, i.e., with a tax. Well, that would be yet another giant social engineering project, which also could be implemented more or less at executive discretion, no matter what the law said. Eh?
NOTE * Lazarus is also presumes a good faith effort by the administration to enforce the law. Obviously *** cough *** NSA *** cough *** whacking US citizens without due process *** cough*** that's nuts, and the fact that Republican nuts make the claim that the administration is lawless doesn't, sadly, make the claim any less true, or the administration's behavior any less nuts.

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Chromex's picture
Submitted by Chromex on

Just to point out, ONCE AGAIN, that premiums for small-group employers who have ACA policies are expected to rise dramatically in 2015 AND
no exemption
because we don't have to offer anything..
Seems designed to force small employers to tell their employees to go to the exchanges..
AFAIK, based on what my agent told me, ACA compliant policies for small groups increased 25% on average in my state- everyone says to expect greater percentage increases next year- we avoided a huge increase this year by early renewal- and we are a grant reliant nonprofit whose grants are being cut . Not sure how this benefits my employees or their health.

Alexa's picture
Submitted by Alexa on

according to some.

At lot of people (myself included) are distracted by this, thinking that this action might give employers unfair (preferential) treatment over "individuals," whose mandates have NOT been delayed.

However, I've read that the impetus for these actions are to give more employers room NOT to insure their employees, therefore FORCING by law, more people (employees) into the Exchange.

Sounds feasible to me, since corporatist neoliberals seem to manage to "stay one step ahead of" the American people.

nihil obstet's picture
Submitted by nihil obstet on

has become virtually non-existent. If you want a list of areas where the administration doesn't enforce the law, this is a big one. By law, employees working over 40 hours a week should get time and a half for the hours over 40; this law is widely ignored. There's a small list of items for which earned wages can be withheld from employees; employers withhold for additional items. Employers are legally required to pay the employer share of FICA, plus unemployment insurance. They've solved that one by declaring that the people who work for them are "independent contractors" rather than employees. There is virtually no checking on that, so of course the FICA and unemployment taxes aren't paid (and the workers don't get credit for Social Security wages, which will hurt them badly when they start trying to collect Social Security).

If labor law were being enforced at even a minimal level, adding a check for compliance with ACA requirements would not be difficult. I do not expect, however, to see any mention of the widespread failure to protect the rights of workers under labor law in the media. Like the general failure to protect workers, it's a dirty secret.

Chromex's picture
Submitted by Chromex on

Rest assured that I, and all the nonprofits of which I am aware, do follow the above laws and the law requires we get audited every year on this and the cpas that conduct my sudit DO check on such things, as do the worker comp companies who "audit" our ICs each year and routinely turn temp ICs ( such as temp grant proofreaders who work at home) into "employees" so they can charge us more premium. Not all the incentives are "anti-labor" from that perspective, although the effect IS inadvertent. Auditors meticulously audit our FICA and Unemployment payments and we have a "special layer of scrutiny" if we accept over 500K in grant money that goes beyond a regular audit.
I have also performed legal and financial work for for-profit companies , and , before 2001, while such abuses outlined above DID occur, they were not as common as alleged.

And as I understand the ACA compliant thing , next year, I have to buy an ACA compliant policy from my small group insurer. Or at least a policy for which they charge me ACA compliant prices. Which the grants won't pay for.
It may certainly be true that they want to force people on the exchanges,but it would seem to me that there ought to be some yelling about that... certainly that is not as advertised... shocker, I know

Alexa's picture
Submitted by Alexa on

and I constantly "yell about" the ACA and the so-called Exchanges.

As pathetic as our group health insurance plan has become--I'd rather keep it, than to go into the even worse Exchange plans (when it comes to network providers, that is).

The entire ACA was sold under 'false pretenses," as far as I'm concerned.

Almost EVERYONE who was already covered by health insurance, was lied to in some way, regarding the impact that it would have on them.

Democratic Politicians [Who Support The ACA] = Liars!