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Will the delay of the employer insurance mandate affect you?

Will the delay of the employer insurance mandate affect you?

Late yesterday the Obama administration announced it was giving employers a year’s reprieve from the requirement that they either provide affordable insurance for full-time workers or pay a $2,000-a-head assessment.

“We will leave the ‘why’ analysis to the op-eds and pundits,” said DeAnn Friedholm, director of health reform for our advocacy arm, Consumers Union. “More important for us is what does it mean now for consumers?’

The answer is that in the overwhelming majority of cases they will be fine either way. Here’s why.

The so-called employer mandate only applies to companies with 50 or more fulltime employees (defined as working 30 hours a week or more) and it was supposed to go into effect in 2014. The vast majority of large employers already provide insurance, even without a mandate: 94 percent of companies with 50 to 199 employees and 98 percent of those with 200 or more. They do this because if they didn’t, they’d have a hard time hiring or retaining workers with the skills they need.

For more information, see our Health Insurance Buying Guide as well as rankings of health insurance plans.
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Large companies that don’t offer health insurance tend to cluster in industries with a lot of low-skilled, low-paid, non-unionized workers. With a year’s reprieve from paying the assessment, presumably many of them will go right on not offering a health plan.

But whereas today, low-paid workers without an employer plan often can’t afford to buy coverage on their own, their situation will change completely come 2014. As of that date, they will be will be able to compare and purchase comprehensive health insurance on their state’s Marketplace. An individual with an income between $11,500 and $46,000, or a family of four earning between $23,500 and $94,000, will qualify for a new kind of tax credit that they can use right away to help bring the premium down to a more affordable number. Households at the lower end of that range will also qualify for reduced out-of- pocket costs such as deductibles and copays. For more on how these new tax credits will work, download our free booklet.

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