Obamacare Delay Estimated to Cost U.S. $12 Billion
Giving businesses another year to comply with the Affordable Care Act is expected to set the Obama administration back $12 billion, according to estimates by congressional researchers.
The Tuesday report by the Congressional Budget Office, the nonpartisan economic watchdog of the federal government, says that giving businesses with 50 or more full-time or full-time-equivalent employees until 2015 to comply with the Affordable Care Act will cost $12 billion in lost tax revenue.
The CBO now expects Obamacare to cost $1.375 trillion over the next decade, which is $12 billion more than previously estimated. The increase is primarily due to a $10 billion reduction in penalty payments by employers that would have been collected in 2015, the CBO says. Changes to the exchange subsidies are expected to cost another $3 billion, while other smaller changes are expected to save $1 billion.
Prior to the July 2 announcement that the administration would delay collecting fines until 2015, businesses with 50 employees would have been required to offer their employees health coverage or face an annual penalty of at least $2,000 per employee starting in 2014.
Catherine Clifford is senior entrepreneurship writer at CNBC. She was formerly a senior writer at Entrepreneur.com, the small business reporter at CNNMoney and an assistant in the New York bureau for CNN. Clifford attended Columbia University where she earned a bachelor's degree. She lives in Brooklyn, N.Y. You can follow her on Twitter at @CatClifford.