Business groups, GOP lawmaker push for repeal of employer mandate

Health insurance benefits form
The ACA says businesses with 50 or more workers must offer qualifying health coverage to their employees. (Getty/michaelquirk)

Now that the Affordable Care Act’s individual mandate has been repealed, the spotlight has swiveled to its less-discussed cousin: the employer mandate.

The ACA provision requires companies with 50 or more employees to provide qualifying health coverage to their employees or face a tax penalty. But up until November, the Internal Revenue Service wasn’t enforcing it, according to The Wall Street Journal.

Now the agency plans to start assessing penalties, beginning with employers that failed to comply in 2015. As a result, some companies could face hefty fines that run in the millions, one attorney told the publication, noting that the financial impact on smaller businesses could be significant.

Predictably, business groups are not happy about that possibility. They argue that when the new regulations took effect in 2015, it was difficult for employers to figure out how to comply. And they’re lobbying for Congress to make the problem go away by repealing the employer mandate altogether.

In that effort, they have the support of some key Republicans. House Ways and Means Committee Chairman Kevin Brady told reporters on Tuesday that he’s discussed the possibility of repealing or delaying the mandate with his fellow committee members and with Department of Health and Human Service Secretary Alex Azar, The Hill reported.

Brady also said he’d push for any repeal or delay of the mandate to be retroactive.

“We want to make sure our businesses aren't caught up in some sort of fines or punitive measures for the past three years,” he told reporters.

Business groups have also pushed back against another of the ACA’s provisions: the so-called Cadillac tax on high-cost employer-sponsored health plans. Thanks to their lobbying efforts, the tax has never actually taken effect, and a short-term spending bill that Congress passed in January further suspended it until 2022.