(CNN) (Feb. 10, 2014) — The Obama administration is giving employers more time to comply with rules requiring them to provide affordable health insurance for their workers.
Mid-sized companies with the equivalent of 50 to 99 full-time employees will now have until 2016 to provide affordable coverage under Obamacare, a year later than expected, the administration announced Monday.
Only 2% of the nation’s firms are considered mid-sized, with another 2% defined as large.
Companies with fewer than 50 people on staff, which make up 96% of businesses, are not subject to the Obamacare employer mandate.
The phasing in of the employer mandate is designed to make “the compliance process simpler and easier to navigate,” said Assistant Secretary for Tax Policy Mark J. Mazur. But Republicans immediately jumped on the announcement, with Republican National Committee Chairman Reince Priebus saying the administration was “making it up as they go along.”
The announcement marked the latest delay in the Obamacare rollout, which has been plagued by problems. Employers were originally required to provide affordable coverage to their workers this year, but the administration said last July that companies could have another year to comply. Mid-sized firms will have to certify that they did not reduce their payrolls this year to fall into this category.
Monday’s move, however, doesn’t ease any requirements on individuals, most of whom are required to obtain insurance starting this year, whether their employers offer it or not. People who don’t have access to affordable coverage at work can buy insurance on state or federal exchanges.
Companies that don’t provide insurance will be fined $2,000 per employee. But they will be subject to a $3,000 penalty if they don’t offer affordable coverage and one of their workers buys a subsidized plan on the individual exchange.
The announcement also clarified which employees count toward the headcount. Volunteers and seasonal workers employed for six months or less do not. Teachers and other school employees do, even if they have summers off.