Government Pushes Pause on Pay or Play Mandate

On July 2, 2013, the Obama Administration delayed the implementation of the employer shared responsibility requirements of the Affordable Care Act (“ACA”). Commonly referred to as the “Pay or Play Mandate,” the ACA requires that large employers provide affordable and comprehensive health care coverage to their employees or pay penalties.

The Pay or Play Mandate was scheduled to take effect on January 1, 2014. Now, the Pay or Play Mandate will not apply until 2015.

The Obama Administrative cited the complexity of the reporting requirements and the need for more time to implement them effectively as reasons for the 1 year delay. As part of Pay or Play Mandate, applicable employers will be required to report information to the government related to the health coverage offered to their employees. The government hopes to use the additional time to simplify the reporting requirements for applicable employers and adapt health coverage and reporting systems related to this process.

Although there has been a delay in the implementation of the Pay or Play Mandate, large employers should continue to develop and implement strategies related to health care reform for their businesses. The additional time may allow some employers to consider options previously unavailable to them. In addition, because the health insurance marketplaces/exchanges are still slated to begin open enrollment on October 1, 2013, large employers should consider the effect the individual and SHOP marketplaces will have on their ability to satisfy their human capital needs.

Additional Resources:
Full statement from the U.S. Treasury Department
Affordable Care Act: What Every Business Needs to Know
Final HIPAA Regulations
Accountable Care Organizations

To find out more about the impact that the Affordable Care Act has on health care and your business, contact Health Care Department Chair Jonathan Raven at or 517.377.0816, or our Employee Benefits Department Co-Chair Elizabeth H. Latchana at or 517.377.0826.

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