Learning from early adopters: Illuminating article on the ACA from RestaurantBusinessOnline.com.
“Don Fox was busy designing a health-insurance plan for his workers when he got an unexpected reprieve from Uncle Sam: an extra year. Unlike many of his colleagues, he decided not to take the delay.
Before Obamacare’s rules kicked in, he wanted to shake down his insurance program, to find out how it would hit his operations and his bottom line. …
For at least some early adopters, Obamacare may not be the apocalypse they had dreaded. “The numbers have generally gone down from what people feared would be the worst-case scenarios,” says Scott DeFife, executive vice president of policy and government affairs at the National Restaurant Association. There are several reasons, say benefits consultants.
One is that many employees just don’t sign up. Thirteen percent are covered under spouses’ or parents’ plans, according to the University of California Berkeley Center for Labor Research and Education. Others decide it’s cheaper to pay a tax penalty for going uninsured than to pay their share of premiums. “You’ve satisfied the obligation to offer the coverage,” says Keith McMurdy, benefit-plan attorney with Fox Rothschild in New York City. “There’s no requirement to force people to be covered.”
Some insurers are softening the blows, too, by offering lower-cost options tailored to restaurants. “Insurance companies have been nimble,” says Gary Levy, hospitality-practice partner with accounting firm CohnReznick in New York City. “They’ve gone out and designed plans that meet the act’s requirements that are very affordable.”
Speaking of work hours, millions of restaurants will need to start tracking them in January, even if they’re not yet offering insurance. That’s because they’ll have to report those 2015 hours to the IRS, to document who’s eligible. Michelle Neblett, director of labor and workforce policy for the NRA, recommends making sure your payroll system is set up to gather the numbers. “You’ll have a hard time if you wait to rebuild this data at the end of next year,” she says. “This is a massive hidden compliance cost, which a lot of people are not paying attention to.”
Try to remove whatever uncertainties you can, experts say, because there will be plenty remaining that are out of operators’ control—such as 2016 insurance rates, most of which won’t be set until next fall. By then, NRA lobbyists hope Congress might raise the definition of full time to 40 hours. That would exempt another 21 percent of restaurant staff from employer mandates, according to UC Berkeley Labor Center figures.”