On July 2, the U.S. Department of the Treasury issued a press release announcing that enforcement of the employer "shared responsibility" provisions of health care reform, Section 4980H of the Internal Revenue Code, would be delayed until January 1, 2015. The "shared responsibility" provisions potentially impose two non-deductible excise taxes on large employers (employers with more than 50 full-time employees). The first tax may be assessed if an employer fails to offer coverage to at least 95% of its employees. The second tax may be assessed if an employer offers coverage, but one or more employees obtain coverage through an exchange and receive a premium subsidy.
Formal guidance has not been issued, so the actual terms of the delay are not yet known. We will provide additional information as it becomes available. It is important to note that many upcoming deadlines will not be affected by the delay, including the "average comparative effectiveness fee," which is reported on IRS Form 720 and is due July 31st, and the requirement that employers prove notice about the exchanges later this summer.