Delaying the employer mandate will result in about 1 million fewer people having employment-based health insurance next year and cost the government billions of dollars in lost revenue, according to a Congressional Budget Office (CBO) report released Tuesday.

 

About 156 million Americans next year will receive health coverage through their employers, or 1 million fewer than the CBO projected in May prior to the Treasury Department's decision to delay the requirement that larger employers offer health insurance or pay a fine, Business Insurance reported.

 

The CBO report, requested by Rep. Paul Ryan, R-Wis., chairman of the House Budget Committee, is the first to analyze the effect of the Treasury Department's surprise July 2 announcement to delay the so-called employer mandate. Under the Patient Protection and Affordable Care Act, employers with at least 50 employees will be liable for a $2,000 penalty for each full-time employee, minus the first 30 employees, if they do not offer coverage.

 

The CBO said it expects "some large employers that would have offered health insurance coverage to their employees in 2014 will no longer do so as a result of the one-year delay of penalties." Still, the CBO said it expects that "few employers will change their decisions about offering such coverage."

 

Of those 1 million individuals, about half will be uninsured next year, with the other half obtaining coverage through public health insurance exchanges, Medicaid or the Children's Health Insurance Program, the CBO said.

 

In addition, the CBO projects the government will see a $10 billion shortfall in revenue from penalties that would have been paid by employers not offering qualified coverage.