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The Obama administration’s decision to delay an Affordable Care Act requirement that larger employers offer their workers minimum health benefits or pay a fine will affect only a sliver of the population and have minimal impact on the health law at large, according to a new study by the nonpartisan RAND Corporation.
The ACA requires companies with 50 or more workers to provide a minimum standard of health benefits to their employees or pay a $2000 per employee fine after the first 30 workers. Republican lawmakers and Obamacare critics quickly seized onto the administration’s decision to delay the employer contribution provision in July as proof that the health law is “unworkable.” Administration officials disagreed, arguing they’d made the move after hearing concerns from businesses that they wouldn’t be ready to properly enforce the requirement by 2014, and that it wasn’t a major delay to the law.
RAND’s findings support that claim. Researchers estimate that even with the delay — which businesses may take advantage of but are not obligated to do so — only about 1,000 fewer firms (or 0.02 percent of all employers) will begin offering coverage to their workers in 2014. That means that approximately 300,000 fewer Americans will have health benefits beginning next year than would have without the delay. All told, only 0.4 percent of all American firms are expected to pay penalties for offering no insurance to their workers at all.
That’s not surprising considering that the vast majority of companies — or 96 percent of all firms — with over 50 workers already offer acceptable employee health benefits. RAND’s study demonstrates that many companies that don’t will begin doing so next year anyways despite their option of waiting until 2015.
The study also serves as a counterpoint to Obamacare critics’ argument that the law’s individual mandate for all Americans should be similarly delayed and eventually repealed. “We should be thinking about giving the rest of America the same exemption that Obama…gave businesses,” said House Speaker John Boehner (R-OH). But although 300,000 Americans would be temporarily affected by the employer mandate delay, scrapping the individual mandate would leave over 13 million Americans uninsured and raise premiums in the individual market between 15 and 20 percent.