We recently wrote an article (here) for our quarterly newsletter discussing the Affordable Care Act’s employer “play or pay” penalty, which requires applicable employers to provide health care coverage to certain employees or pay a penalty.

This provision of the ACA (referred to by some as “Obamacare”) provides that a large employer (those who employ an average of at least 50 full-time employees or full-time equivalent employees) is subject to a non-deductible play or pay penalty if (a) it does not offer group health coverage to at least ninety-five percent of its full-time employees (and their dependents), (b) it has at least 30 full-time employees, and (c) at least one of its full-time employees enrolls in coverage through a state or federal health exchange and qualifies for a subsidy or tax credit for coverage.

This provision was originally set to go into effect on January 1, 2014.  However, because of the uncertainty surrounding the law and the feedback received from several employers, the Obama Administration yesterday decided to provide businesses an additional year, until January 1, 2015, to prepare for and implement this change.  Thus, employers can breathe a sigh of relief, at least for a little while.  But, due to the complexity of the law and the careful planning required to implement this change, employers should not wait until the last minute to begin planning.