Washington: The US has delayed implementation of a key part of Barack Obama`s ambitious healthcare programme by one year, which experts and media say is another setback to the landmark healthcare overhaul initiated by the President.
According to The Washington Post, the provision, commonly known as the employer mandate, calls for businesses with 50 or more workers to provide affordable quality insurance to workers or pay a USD 2,000 fine per employee.
The change in the employer mandate is arguably the most significant concession the administration has made to date.
The mandate was originally set to kick in for 2014, but will now start in 2015 as business groups had objected to the provision.
In a blog posting on the White House website, Valerie B Jarrett, a Senior Advisor to President Obama, explained that the Administration plans to re-vamp and simplify the reporting process.
"Some of this detailed reporting may be unnecessary for businesses that more than meet the minimum standards in the law. We will convene employers, insurers, and experts to propose a smarter system and, in the interim, suspend reporting for 2014," Jarrett wrote.
"As we make these changes, we believe we need to give employers more time to comply with the new rules. Since employer responsibility payments can only be assessed based on this new reporting, payments won`t be collected for 2014," the official 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."
In another blog, Assistant Secretary for Tax Policy at the US Department of Treasury Mark Mazur announced that it will provide an additional year before the Affordable Care Act mandatory employer and insurer reporting requirements begin.
"We recognise that this transition relief will make it impractical to determine which employers owe shared responsibility payments (under section 4980H) for 2014," Mazur said.
"Accordingly, we are extending this transition relief to the employer shared responsibility payments. These payments will not apply for 2014. Any employer shared responsibility payments will not apply until 2015," Mazur said.
The New York Times termed it as a "significant setback" for Obama`s signature domestic initiative. Congressman Peter Roskam said that such a decision is an acknowledgement that president`s health care reform was ill-conceived and is thus unworkable in the real world.
"But admitting the employer mandate isn`t ready for prime time raises more questions than answers," he said.
House Majority Leader Eric Cantor said this further confirms that even the proponents of ObamaCare know it will hurt jobs, decrease economic growth and make it harder for families to have access to quality and affordable health care.