The Better Care Reconciliation Act (BCRA), which is the Senate GOP’s response to the House GOP’s original healthcare bill aimed at repealing the Affordable Care Act (ACA), still needs to be voted on in the Senate, so its fate remains uncertain. However, it’s important restaurant owners understand the implications it may have if passed because restaurants would be among the top industries impacted.
A key difference between the BCRA and the ACA is the employer mandate. Under the ACA, companies with 50 or more full-time (or full-time equivalent) employees were required to provide affordable health insurance to full-time staff. The proposed BCRA will remove the employer mandate and leave it up to organizations to decide whether or not they provide insurance.
Restaurant owners should begin to think about the below three aspects:
Weigh the pros and cons to providing insurance
While restaurants can save money by not providing health insurance, they should weigh the risks and rewards of rolling back coverage for employees.
The big pro here is that companies can save money by not offering health coverage for their employees. If the majority of an organization’s employees weren’t covered under the ACA because they were exempt or didn’t work the required 30 hours per week to qualify as a full-time employee, it might not make sense to keep offering coverage.
However, one of the risks organizations may face if they stop offering health insurance could be that without insurance, employees may not be able to receive preventative care or the adequate medicine for when they are sick. This means they might not show up to work or they’ll be working in a restaurant while sick, which isn’t good for either the restaurant, its customers or the employee.
The potential impact on employee engagement and retention
A large portion of restaurant employees work for minimum wage and benefitted from the ACA. Given that, staff morale and engagement could be impacted if owners stop offering coverage. Dropping coverage may lead employees to feel slighted or unsupported by their employer, so it’s important owners recognize how employees may respond.
When changing something as impactful as health insurance, it’s crucial to communicate the reasoning and to educate employees on how the changes may affect them. If not, it can negatively impact employee engagement and productivity. The key is to over-communicate and be honest. Tell them everything they need to know and do it sooner rather than later.
Coach managers on how to have the discussion with their teams and offer resources for employees to help educate themselves on health insurance. Or, owners can bring in an outside expert to come in and speak to staff about utilizing the health insurance marketplace to find low cost plans.
Health insurance could become a competitive advantage
The restaurant industry added 30,300 jobs last month, according to the Bureau of Labor Statistics. More than one out of every five jobs added were in the restaurant industry. Because of the employee-driven tight labor market, offering a robust benefit plan can serve as a major competitive advantage if a restaurant group can afford the expense. For those employers that are more budget conscious, offering a lower cost high-deductible health insurance plan, coupled with a Health Savings Account (HSA), generous paid time off, or even a tuition reimbursement program will help attain good talent while also maintaining their bottom line.
As of right now, the future of the proposed healthcare plan is still uncertain. However, these are guidelines that every restaurant owner and leader should consider as they contemplate the pending legislative changes
Restaurants already operate on razor thin margins, so getting rid of the employer mandate could result in huge cost savings. That said, a large population of employees without health insurance may have long-term effects on the restaurant industry as a whole.
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