Are surcharges at restaurants and other businesses a fair way to pay for healthcare for all?
Recently, some restaurant chains as well as other small businesses are trying to do the right thing for their employees while making sure the right thing does not harm their bottom line. In the case of some restaurants, the right thing may exist as a surcharge on your bill in addition to the cost of food to help therm pay for health insurance for their employees.
Read about one example here
Would You Be Willing to Pay More to Dine Out if it Meant Healthcare for Workers?
by Robin Marty
A Los Angeles restaurant is facing heavy criticism from diners over a new policy that has added a 3 percent tax to the ticket when dining out. The new surcharge is meant to allow the business to pay for the health care insurance costs for their employees, but customers are split over whether the blatant add-on is an open and honest admission about the costs of doing business, or a sign that restaurant owners are simply gouging their guests.
According to the LA Times, Republique restaurant is embarking on a new, transparent means of passing on health care costs to consumers, with a 3 percent “Healthy LA” surcharge per diner. The charge, according to the restaurant owners, will go directly to paying for new employee health insurance plans, a must have under the new Affordable Care Act for any business that employs more than 50 full time employees. Some of the plans that will be offered will be completely paid for by the company, others will have employees pay a portion of the cost, but all will be accessible to all workers, regardless of whether they are hourly, tip based, at the front of the restaurant or back in the kitchens.
Read more: here
Of course, this is likely just the beginning. Health insurance for everyone is the goal of Obamacare and finding palatable ways of doing this by passing on a tax of sorts (surcharge) is a smart way of doing this. Of course, the scare tactics of others inferring that companies would eliminate full time positions does not help.
While insuring everyone certainly helps, the ultimate question needs to be the value received by the newly insured, by our overpriced system of healthcare services. You must also wonder if the coverage they receive is even affordable to them to use or is it just a token for the company to use to say they are doing the right thing, even if the employee is saddled with a high deductible plan that they may almost never use (a lower wage worker who has a 2500 dollar deductible for example).
Considering that health insurance is a tax, would Medicare for all been a better way of doing this since it would be much less expensive, would have avoided the ridiculous cost of these exchanges (a national site that should have cost a couple of million at most) and better cost negotiating power. For an estimate from the washington post, click here.
Most people do not fully process what $350 million is to an average person, however, since the exchanges cost that much to sign up to this point 3-4 million people and counting, how many people would this have insured if we avoided this cost? By calculating an average per person cost of $4000, this money may have insured almost 88 thousand people.
Like it or not, the quest to insure everyone will have a cost, however, it is how the money is spent in the end that will determine the value we get. Medicare for all gives us better value since it delivers us more comprehensive healthcare services for a better price while making sure the restaurant surcharge we may see in the future goes to improving the lives of others.
Is it ethical to charge a surcharge to make sure people can have access to health services and avoid the medicaid system? I believe it is and this type of model may soon take off and become the norm. Many small businesses may soon realize that they can afford to insure their employees with a surcharge like this.
Would cradle to grave coverage be a better way to do this, just building the cost of healthcare into our economy and giving all citizens healthcare without the complexities and wasteful costs of trying to maintain insurance companies at the helm?
What do you think? As always, I value your opinion.