Industry News | May 1, 2013

NRA Testifies On Health-Care Law Challenges in NC

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The vice chair of the National Restaurant Association’s (NRA) board of directors and a North Carolina restaurant industry veteran told a House panel that the 2010 health care law poses costly challenges for restaurateurs and, without reforms, may sacrifice jobs in North Carolina and across the nation.

Ken Conrad, chairman of Libby Hill Seafood Restaurants based in Greensboro, North Carolina, testified before the U.S. House of Representatives Education and Workforce Committee’s Subcommittee on Health, Employment, Labor, and Pensions field hearing in Concord, North Carolina.

The hearing to examine the health-care law’s impact on North Carolina jobs was hosted by Subcommittee Chairman Phil Roe (R-Tenn.) and Congressman Richard Hudson (R-N.C.).

In his testimony on behalf of the NRA, Conrad highlighted three areas as problematic for the restaurant industry: the definition of a full-time employee; the complexity of the applicable large employer determination; and the potential harm the automatic enrollment provision could cause for some employees.

“The restaurant and foodservice industry faces a number of challenges in implementing the law due to the unique characteristics of our workforce,” Conrad said. “The National Restaurant Association has worked to constructively shape the implementing regulations of the health-care law. Nevertheless, there are limits to what can be achieved through the regulatory process alone. At the end of the day, if this law remains in effect as it is currently written, restaurant and foodservice operators will face serious challenges in its implementation.”

Conrad noted that his business uses a 40-hour work week to define full-time and part-time; the law’s new definition of full-time at 30 hours a week will mean changes for the company and its employees.

He also pointed to concern from operators near the 50 full-time equivalent employees threshold, and the requirements they would be subject to if they do become a large employer under the law.

Conrad thanked Hudson for his leadership in introducing H.R. 1254, the Auto Enroll Repeal Act, which would eliminate the needlessly burdensome automatic enrollment requirement in the 2010 health-care law.

“The automatic enrollment requirement is of concern to many in the industry,” Conrad said. “Restaurateurs with 200 or more employees must automatically enroll new and current employees in a plan if they do not opt out of health coverage.

“Despite education and notification, employees may miss the 90-day window to opt out, causing potential confusion and financial hardship,” he added. “Since the same full-time employees must be offered coverage by the same employers subject to the Automatic Enrollment provision and the employer mandate provisions, we believe the automatic provision is redundant and should be eliminated.”