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Tags: McGowan | employer | mandate | Obamacare

BakerHostetler Lawyer: Employer Mandate Delay Doesn't Signal 'Retreat' from Obamacare

By    |   Friday, 05 July 2013 09:23 AM

The Obama administration's decision to delay implementing the employer mandate of the Affordable Care Act doesn't signal the White House is pulling back on Obamacare in general, says John McGowan, a partner at BakerHostetler law firm.

"Given that the Treasury Department alone made the announcement, it does not look like an attempt to float an idea, or signal the start of a general retreat from implementing the Affordable Care Act," McGowan, who specializes in employee benefits, said in a statement.

The Treasury Department was the agency to authorize the delay because the central issue is taxes, he explained. The penalty that large employers would pay for failing to provide health insurance coverage to their workers under the mandate is a tax.

Editor's Note:
ObamaCare Secrets Revealed

"The announcement really focuses on how the tax penalties would be administered, and what employers must do to provide information to the IRS. It also highlights the challenges the IRS faces, as the agency charged with assessing, collecting — and enforcing — the tax penalties that non-compliant employers will face under the Affordable Care Act," McGowan stated.

"A fair reading of the applicable sections implies that the IRS recognizes that it can't or won't be able to collect the information it needs, and that it won't have the systems in place to make sense of any information it does obtain, to enforce the new tax penalties."

The mandate was scheduled to begin Jan. 1, but has now been pushed back to 2015.

The delay means more people will likely fail to receive insurance from their employers, McGowan noted. And many of these workers may opt for public exchanges, where they can receive government-subsidized coverage, he added.

That could produce a significant increase in the budget deficit, McGowan asserted.

As for implications of the delay for stocks, Zacks Investment Research still places all healthcare sectors affected by Obamacare in the top half of its sector rankings, CNBC reported.

And Zacks Chief Equity Strategist John Blank doesn't see that changing soon. "You have to stay bullish on the sector," he told CNBC. "What was announced is unlikely to change that dynamic very much."

Editor's Note: ObamaCare Secrets Revealed

© 2022 Newsmax Finance. All rights reserved.


Economy
The Obama administration's decision to delay implementing the employer mandate of the Affordable Care Act doesn't signal the White House is pulling back on Obamacare in general, says John McGowan, a partner at BakerHostetler law firm.
McGowan,employer,mandate,Obamacare
360
2013-23-05
Friday, 05 July 2013 09:23 AM
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