Last Friday, the Obama administration announced that it will cease issuing waivers for an amendment of the larger health care reform legislation on September 22. Previously, these waivers have been extended to companies that feel they are unable to meet the law’s mandate that employers offer more than $750,000 in benefits payouts each year.
At the end of May, 1,433 waivers had been granted to companies like McDonalds and Foot Locker, who largely employ part-time staff members at minimum wage, and generally only offer mini-med benefits packages. A report issued by the Government Accountability Office last week stated that the waivers were designed for companies like these, and others who said that, without one, they would have to cut premiums by 10 percent or cancel health coverage entirely.
Waiver applications that predicted a premium increase of 6 percent or less were generally denied.
The Obama administration has justified the distribution of these waivers by saying they’re just a bridge to help ensure that coverage is made available to as many people as possible until the health insurance exchanges become active in 2014.
Opponents to the law, however, have used the growing grey area created by waiver handouts to attack the Affordable Care Act as ineffective and inherently flawed. By ending the waiver application process, the administration will avoid the negative press it receives each time a new batch of waivers is issued.
Beginning in September, the annual benefits limit increases to $1.25 million, with another leap to $2 million for plan years beginning in September 2012.
[Source: New York Times]