Obamacare Hits Fast Food Business-Owners

Fast Food Nation: The Dark Side of the All-American Meal.

Title of 2002 book by investigative journalist Eric Schlosser on social consequences of fast food

November 23, 2012 -  The Patient Affordability Care Act (aka Obamacare) stipulates that on January 1, 2014: Every full time employees must be provided with comprehensive medical coverage if the company employs more than 50 full-time workers.

To fast food corporations and fast-food franchise owners, who operate on razor-thin margins,  this stipulations hits like a profit-killing thunderbolt.  How do you stay in business in a competitive marketplace, when this stipulation would dramatically increase your expenses for providing health benefits. “Comprehensive” government  sanctioned health benefits, are, by definition,  more expensive than currently provided in private plans.   

If you do not choose to provide government approved plans,  you will be fined $2000 for each full-time employee.  For Appleby’s in New York City along, this would cost $600,000.  For Applebys nationwside for th other firms like Papa Johns, Dennys,  McDonalds, Burger King, and Wendy’s, the cost would be enormous, in the billions of dollars.

If you are a business planner for a fast food restaurant chain, what are your option?

·          Roll back expansion

• Do not hire more full time employees.  

• Reduce thousands of employees to part-time, under 30 hours each week.

·         Raise prices, as Papa Johns has done by increasing the price of its pizzas.

If you are a worker for these chains, your options are:

·         Pay for your own health insurance with your greatly reduced income.

·         Work for multiple fast food restaurants.

·         Go on Medicaid, for which you may now quality and accept the fact that not enough doctors accept Medicaid patients and he benefits are less than private plans.

When Obamacare passed, it was no doubt done so with good intentions.

Unfortunately,   as Samuel Johnson observed, “The road to hell is paved with good intentions” and adverse consequences for those it was intended to help – lower incomes, paying for one’s health insurance,  or going on Medicaid, if you qualify.   Good intentions have consequences.

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