Pizzeria Drops 3% Obamacare Surcharge Within 24 Hours When Customers Object to That Topping

A  pizza shop scrapped a 3 percent surcharge on customers’ checks to cover Affordable Care Act fees for employees a day after adding it.

On Tuesday, Brooklyn restaurant Franny’s put a note on its website saying the pizza shop would add the surcharge because of  Obamacare. The message—“a 3 percent surcharge will be added to all checks to contribute to the cost of the Affordable Care Act for all Franny’s employees”—remained on the restaurant’s online menu as of Wednesday afternoon.

But the extra charge reportedly no longer will be in effect because some customers viewed it as “anti-Obamacare.”

The employer mandate central to the Affordable Care Act, or Obamacare, requires businesses with 50 or more full-time employees to offer “reasonably priced” health insurance by 2016, or pay a steep penalty of $2,000 per worker.

“The requirement is that they provide coverage of a certain minimum amount and that it be affordable to their workers,” Ed Haislmaier, an expert in health care policy and markets at The Heritage Foundation, told The Daily Signal.

The employee count at Franny’s alone isn’t large enough to meet the mandate requirements. But the health law applies  because the owners of Franny’s, the husband-wife team of Andrew Feinberg and Francine Stephens, also run Rose’s Bar and Grill and the BKLYN Larder market.

The Obamacare surcharge had been added to all three establishments, NBC New York reported.

“I’m hoping that on a community empathetic level, that most of the people who love Franny’s will understand and will continue to come,” Stephens told the New York Eater before killing the new charge. “On a realistic level, I think a number of our guests will not be able to come as much.”

In Case You Missed It:  Teach children, Hindu scriptures offering high moral values

Instead of the Obamacare surcharge, Franny’s reportedly will increase its menu prices. An updated menu was expected to be posted Wednesday.

In a letter to customers explaining the situation, according to Eater, the restaurant said:

Initially, we thought, before we start putting $22 pizza on the menu, let’s be transparent about what that money is actually going towards. However, it seems given the stated preference of our guests as well as the potential for misinterpretations into the future, we will retract the surcharge and reconfigure our menu pricing instead.

Providing health care for all three establishments will cost about $200,000 per year, Stephens told DNAinfo New York.

“This is a cost that we cannot absorb without going out of business,” she told the New York Daily News.

Heritage’s Haislmaier said an employee’s share of the cost of the Obamacare mandate is required not to exceed about 8 percent of  his or her pay.

“These additional costs are ultimately borne by the employees,” he said.

Haislmaier said the effect of the Obamacare mandate on businesses such as Franny’s is much like an increase in the minimum wage. Employers in situations like Franny’s, he told The Daily Signal,  “have basically two choices: find ways to reduce the amount of labor so they will lower their expenses or [try] to find ways to pass the cost, the increase of labor costs, onto their customers.”

The route Franny’s originally chose to deal with the additional costs is “one strategy of several strategies” employers can take, Haislmaier said.  The best option depends on the employer and the circumstances, he said.

In Case You Missed It:  Fifteenth Anniversary of The Conservative Papers

In New York City, rising minimum wage costs have some restaurants considering eliminating tips and instead implementing a surcharge to help pay for higher wage and health care costs, the New York Post reported.

Haislmaier said another tactic used by employers to try to fall below Obamacare’s threshold is to drop some workers to part-time status, so the employers won’t have to provide health care coverage.

It is not a new phenomenon for restaurants to add an Obamacare surcharge. In 2014, more than a dozen high-end eateries in Los Angeles reportedly added a surcharge to cover employees’ health insurance. Several restaurants in Florida also tacked on the fee.

Source material can be found at this site.

Posted in Freedoms and tagged , , , , , , , .