Car dealers will have an extra year to grapple with a key provision of President Barack Obama's health care law. The question is: Will they make the most of it?
The Obama administration said last week that it will wait until 2015 to enforce the so-called employer mandate, which requires businesses with the equivalent of 50 or more full-time employees to offer health insurance coverage to full-timers or pay fines of as much as $3,000 a year per employee.
The reprieve came as a relief to auto dealers, many of whom have been slow to move toward compliance as they consider whether they're better off insuring their employees, enduring the fines or finding a way to exempt themselves from the mandate.
But the National Automobile Dealers Association and experts on the health care law say dealers shouldn't look at the administration's decision as cause for delay.
It would be a "huge mistake" for dealers to wait until this time next year to have a plan in place, says Marcus Newman, an insurance consultant from Chicago who has 10 dealerships among his 500 small-business clients.
Newman, vice president of the employee benefits division at consulting firm GCG Financial, said he's hearing from dealers wondering whether the employer mandate has been repealed. "But nothing has really changed," he said.
NADA has similar concerns. The trade group has long fought the health care law on the grounds that it ultimately would raise health insurance costs, putting a burden on dealers. Now NADA is strongly urging members to figure out how to comply.
"Doing so sooner rather than later is probably a far better business decision," NADA spokesman Bailey Wood said in an interview last week.
NADA's position is a sign of how it has shifted its message since the president won re-election in November. In December, NADA started holding frequent online seminars to help dealers comply with the law. The group also held six seminars on the subject during its convention this February in Orlando.
As long as Obama holds the White House, the group has concluded, dealers cannot sit back and hope that Congress will undo the law.
"It's the law of the land, and we simply have to live with it, whether we like it or not," Wood said.
For dealers, living with the law means puzzling over a math problem with many variables. How many employees are there, and how many hours do they work? How many have health insurance already? What do they pay in premiums? And how do the costs of insurance compare with the fines?