On July 2, 2013, the Obama Administration announced that it will provide an additional year – until 2015 – for employers to begin complying with the mandatory employer reporting obligations under the Patient Protection and Affordable Care Act (“PPACA”). These reporting obligations are intended to determine which employers owe shared responsibility (“pay or play”) penalties under PPACA.

As a result, the Obama Administration is postponing enforcement of the pay or play penalties under PPACA. According to the Administration’s press release: “Any employer shared responsibility payments will not apply until 2015.”

The Administration announced that it expects to publish proposed rules this summer that will implement the reporting obligations under PPACA. The Administration will conduct a “dialogue” with employers and other stakeholders in an effort to minimize the reporting requirements.

During the 2014 transition period, the Administration is encouraging employers to maintain or expand health coverage in a manner consistent with the requirements of PPACA. However, the transition relief does not affect employees’ ability to access the premium tax credits available in connection with health insurance exchanges.

Please stay tuned – we will keep you updated as we receive additional guidance on this transition relief. For more information, please contact your SGR Executive Compensation and Employee Benefits Counsel.