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Friday, Aug 01, 2014
Editorials

Wise delay to Obamacare mandate

Published:

The Obama administration provided Americans with a Fourth of July gift by delaying for a year the mandate that large employers must provide health insurance coverage or pay a fine.

Politics, not concern for the economy, was surely behind the decision to put off enacting the centerpiece of the Patient Protection and Affordable Health Care Act until 2015 - after the 2014 midterm elections.

The surprising development underscores the cost and complexity of implementing the law.

We wish, probably in vain, the administration and Congress would work with business interests to scale back this massive government intrusion into the marketplace that is virtually certain to kill jobs and drive up costs.

The administration announced Tuesday it would postpone the requirement that businesses with 50 or more workers must provide affordable health insurance for employees or pay a fine of at least $2,000 per worker.

Businesses owners had complained about the uncertainty of the law, particularly about what information on employees they would be required to collect.

The mandate itself gave small businesses a reason to keep their work forces below the 50-person threshold.

Yet as the administration relented on the business requirement, it apparently maintained the individual mandate that forces uninsured citizens to buy health care insurance or pay a fine.

Also remaining in effect is a directive that states set up marketplaces - exchanges - where the uninsured can shop for policies.

This doesn't make much sense.

The postponement of the business coverage mandate could make it difficult to determine which Americans are eligible for the exchanges because businesses would not have to report whether they are covering workers. And it is curious the administration intends to fine individuals for not buying health insurance, but plans to give businesses a break.

It illustrates the rushed and reckless overreach of Obamacare. It's too bad the entire law was not put on hold.

Still, the partial delay should give the economy a boost.

The act demands an expansion of insurance coverage, including a dictate that those with pre-existing conditions be covered without penalty. However admirable the coverage expansion may be, it is impossible to achieve without increasing costs.

Insurance analysts expect businesses to respond by requiring workers to pay higher deductibles.

The act also does not penalize businesses for not insuring employees who work less than 30 hours. This gives businesses a reason to limit workers' hours.

Obviously the administration belatedly recognized that pushing ahead with this deeply flawed mandate, which includes an array of taxes, would be a political disaster.

Gleeful Republicans again are calling for the law to be repealed. This is futile, as long Obama is in the White House. The better approach would be to give the president a face-saving opportunity to refashion the law into a more reasonable, limited and business-friendly plan that would cover those who genuinely need help without sending shock waves through the economy.

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