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Projected impact of ACA employer mandate delay is small

NEWS IN BRIEF — Posted July 29, 2013

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Delaying the Affordable Care Act’s individual coverage mandate would affect coverage much more significantly than postponing the law’s employer mandate, the Urban Institute concluded in a report.

In early July, the Obama administration decided to postpone until 2015 the ACA’s mandate requiring that employers with 50 or more full-time employees offer a minimum level of coverage to workers or pay potential penalties. According to the report, a one-year delay would have a negligible effect on coverage. Without this requirement, the uninsured rate is expected to decrease to 10.2%, compared with 10.1% under full ACA implementation.

“Most employers offer coverage today, when they face no penalty, and they will, by and large, continue to do so under the ACA,” the report stated. The delay also should have little effect on costs, as premium and cost-sharing subsidies paid by the federal government through the exchanges would drop by only 1%.

Insurance coverage, however, would decline significantly if the ACA individual mandate were eliminated. At least 13.7 million additional people would remain without insurance if they weren’t required to obtain coverage or pay a tax penalty. But even without this requirement, coverage levels still would be higher before the ACA because more people starting in 2014 would seek coverage under expanded Medicaid programs and through subsidized coverage in the nongroup insurance exchange market, the report stated.

GOP lawmakers have pushed legislation to delay both the individual and employer mandates by one year. Rep. Phil Roe, MD (R, Tenn.), said he was “extremely disappointed to see the administration give protection to businesses by delaying the employer mandate while still requiring individuals to purchase health insurance.”

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