Business Praises Health-Care Implementation Delay

Obama administration gives business one more year on employer mandate.

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Business leaders and their allies are delighted and relieved that the administration is delaying by one year a major requirement of President Obama's health care law that medium and large companies provide health insurance coverage to their employees or pay penalties.

The postponement, from 2014 to 2015, is designed in part to placate corporate interests that said the mandate would have imposed a hardship on employers, cost jobs and restrained economic growth.

[READ: Obama Administration Delays Major Requirement of Health Law]

Administration officials said the provision was designed to expand health coverage for many uninsured people.

Valerie Jarrett, a senior White adviser, said late Tuesday that the administration was making the change in order to be responsive to business. "We believe we need to give employers more time to comply with the new rules," she wrote on the White House web site. "....We are listening."

President Barack Obama speaks about the National Security Administration's program of collecting Americans' phone records in San Jose, Calif. on June 6, 2013.
President Barack Obama speaks about the National Security Administration's program of collecting Americans' phone records in San Jose, Calif. on June 6, 2013.

Randy Johnson, senior vice president of the U.S. Chamber of Commerce, issued a statement calling the delay "a pleasant surprise." He added: "The administration has finally recognized the obvious – employers need more time and clarification of the rules of the road before implementing the employer mandate."

Some Republicans saw a political motive – a desire by the White House to put off the business requirements until after the mid-term elections of 2014 and avoid giving conservatives another issue with which to hammer Democrats. Sen. John Barrasso, R-Wyo., said the administration's action was "a cynical political ploy to delay the coming train wreck associated with Obamacare until after the 2014 elections."

[POLL: More Than Half of Americans Think Obamacare Will Make Lives Worse]

The delay doesn't affect other controversial provisions of the law, known as the 2010 Affordable Care Act, notably provisions establishing state-level health insurance marketplaces, known as "exchanges," where the uninsured would shop for insurance. But those provisions may now be harder to implement.

"I am utterly astounded," Sara Rosenbaum, professor of health law and policy at George Washington University, told the New York Times. "It boggles the mind. This step could significantly reduce the number of uninsured people who would gain coverage in 2014."

The law also requires individual Americans to have health insurance in January 2014 or be subject to penalties. The new change doesn't change that requirement.

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  • Ken Walsh covers the White House and politics for U.S. News. He writes the daily blog "Ken Walsh's Washington" for usnews.com and "The Presidency" column for the U.S. News Weekly. He is the author of the new book "Prisoners of the White House: The Isolation of America's Presidents and the Crisis of Leadership." Ken Walsh can be reached at kwalsh@usnews.com and on Facebook and Twitter.