Businesses gain a year to navigate changes in health care coverage
A new delay to the Affordable Care Act allows businesses with 50 or more employees another year to start offering medical coverage before facing fines, the Obama administration announced last week.
Now, businesses have until Jan. 1, 2015, to provide employees working 30 or more hours a week with suitable health coverage or pay a fine.
While this might not have a large impact economically, the move helps local businesses and the government figure out how the health care changes will be implemented, said Terry Clower, director of the Center for Economic Development and Research at the University of North Texas.
“They are allowing small businesses time to decide how to respond. ... From what I’ve heard, they’re having a hard time figuring out who to call,” Clower said. “Just as importantly, it gives the bureaucrats more time to figure out how it will be implemented.”
Businesses will now have more time to prepare and plan to be in compliance and understand the mandates, said Doreen Rue, CEO of Health Services of North Texas.
“I think the Affordable Care Act is a very complicated act with many challenges, so having some delays in implementation is not surprising,” she said. “It is our hope that the care act will provide better health care for communities and local businesses, so as we continue to learn more, our anticipation is we’ll have a healthier community because of it.”
Some local business owners like Mel Knight, a partner with Fuzzy’s Taco Shop, said the delay will “absolutely” help. Knight has been following the changes over the past few months and is pleased there will be more time to make employment decisions.
“Obviously, once it all settles in, we’ll make the best decision concerning our business at that point,” Knight said. “I feel like we’ve got a good plan of action and ... we will again continue to monitor the best way to handle that as we go forward as a small business.”
Some businesses may cut staff or full-time employees to avoid the law, Clower said, and he said the delay is a signal that the implementation could have a negative impact on job creation and small business.
“One of the concerns has been they don’t know what the effect will be, and while the economy is recovering, job creation is still not robust,” he said. “In part, the administration is responding to ‘don’t impose this thing’ folks that think there could be a negative impact at a time we’re still trying to get job creation.”
John Baines, a Denton certified public accountant, said he is continuing to attend classes to learn about the law and help explain the requirements to his clients and the community.
He plans to offer another workshop in November through the Denton Chamber of Commerce, which will tackle the maze of exceptions in the law.
The workshop materials will include schematics to help employers see where they land in the law’s requirements, which includes an October 2014 deadline for businesses to tell their employees what they are offering.
“For employers, it will help to alleviate their concerns and to prepare for their responsibilities, too,” Baines said.
Most businesses with 50 or more employees will remain unaffected. According to an annual survey by the nonprofit Kaiser Family Foundation and the Health Research & Educational Trust, more than 94 percent of employers covered by the mandate already provide health insurance.
The delay is aimed at helping the other businesses by giving them more time to comply with the mandate, wrote senior Obama adviser Valerie B. Jarrett in a White House blog post.
“Since employer responsibility payments can only be assessed based on this new reporting, payments won’t be collected for 2014,” she wrote. “This allows employers the time to test the new reporting systems and make any necessary adaptations to their health benefits while staying the course toward making health coverage more affordable and accessible for their workers.”
Staff writer Peggy Heinkel-Wolfe and The Associated Press contributed to this report.
JENNA DUNCAN can be reached at 940-566-6889 and via Twitter at @JennaFDuncan.