Restaurants Set to Suffer Under ObamaCare

Posted: Jul 08, 2010 4:17 PM

When the full effects of ObamaCare are felt, be ready to pay more for lunch at the burger joint down the street. Restaurants are anticipating laying-off workers and passing higher costs onto the consumer in order to deal with the requirements in the Democrats’ new health care law.

The Cleveland Plain Dealer reports on the impact expected by one burger chain in particular, White Castle:

“The Columbus-based family owned restaurant chain - known for serving small square hamburgers called "sliders" – says a single provision in the bill will eat up roughly 55 percent of its yearly net income after 2014.

“Starting that year, the bill levies a $3,000-per-employee penalty on companies whose workers pay more than 9.5 percent of household income in premiums for company-provided insurance.

“White Castle, which currently provides insurance to all of its full-time workers and picks up 70 to 89 percent of their premium costs, believes it will likely end up paying those penalties. The financial hit will make it hard for the company to maintain its 421 restaurants, let alone create new jobs, says company spokesman Jamie Richardson.”

Likewise, other restaurants will be hurting. The Plain Dealer went on to note George Ebinger, owner of several International House of Pancake restaurants, who expects penalties for not insuring his 140 workers to cost him $220,000. He could insure those workers, but it will cost approximately half as much to pay the penalties and not insure them.

ObamaCare’s business crippling policies will stunt job-growth at a time when job creation is needed most. After all, unemployment continues to hover right around 10%. This bill needs to be repealed in full, plain and simple. 

My vote against ObamaCare and commitment to free enterprise recently earned me the Thomas Jefferson Award by the International Foodservice Distributors Association. Clearly, insurance mandates resulting in cost hikes and penalties to the foodservice and restaurant industry are not the road to economic growth.