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More Changes Announced for ACA’s Employer Mandate

Change is coming again for employers subject to the Affordable Care Act’s employer mandate as the Obama administration announced two major modifications on Feb. 10, including:

  • further delaying portions of the mandate for certain employers, and
  • adjusting the percentage of employees who must be covered by employers beginning in 2015.


Treasury Department officials will give businesses with fewer than 100 full-time employees – but more than 50 – an extra year to fully implement health insurance coverage for employees who exceed the per-week workload of 30 hours.

These employers will not be subject to penalties until 2016. However, those employing 100 or more full-time workers will remain subject to the coverage rules beginning Jan. 1, 2015. Companies with fewer than 50 full-time employees are still exempt from the mandate.

The second drastic change states that starting in 2015, employers subject to the mandate will be required to offer affordable coverage to at least 70 percent of full-time workers, down from the original requirement of 95 percent. However, come 2016, the rate returns to 95 percent.

Officials also released clarification as to whether certain employees are considered full-time, including teachers and government or tax-exempt entity volunteers, such as volunteer firefighters and adjunct professors who teach less than 15 hours per week. According to a rule released Monday, these individuals will not be considered full-time.

Penalties to employers for noncompliance can cost whichever is less:

  • $3,000 per full-time employee who purchases health care coverage through a government exchange and receives a subsidy, or
  • $2,000 per the total number of full-time employees, not counting the first 30.

The ACA’s original mandate to provide affordable health care coverage first was delayed from 2014 to 2015 on July 2, 2013.

Stay tuned, as more changes to the ACA are likely to occur. Recently, the House Ways and Means Committee recently approved House Bill 2575, which amends the ACA definition of a full-time employee from 30 hours to 40 hours. The bill still has a ways to go before becoming official.

The content of this blog is intended to keep interested parties informed of legal and industry developments for educational purposes only.  It is not intended as legal opinion or tax advice and should not be regarded as a substitute for legal or tax advice.

About the author
Author picture, Jason Bodin
Jason Bodin
Jason Bodin has been the communications pulse for a number of organizations, including Paycom, where he serves as director of public relations and corporate communications. He helped launch Paycom’s blog, webinar platform and social media channels. He aided in the development of Paycom’s tool to assist organizations in complying with the Affordable Care Act, one of the largest changes in health care the country has seen. A graduate of the University of Oklahoma, Bodin previously worked for ESPN and Fox Sports. In his free time, he enjoys adventuring with his family, reading and strengthening his business acumen.