Nearly two-thirds of employers expect to see a cost hike in their health
plans when the Affordable Care Act goes into effect in 2014, according
to new data from the consulting firm Mercer.
Employers in the restaurant and retail industries -- those with a large number of hourly wage workers who traditionally had minimal or no health insurance -- are more likely than other companies to drop their health plans or cut worker's hours in order to maintain their already slim profit margins.
According to a Mercer survey of 1,203 employers, nearly half of retail and hospitality employers expect the health care overhaul to push up cost by at least 3 percent in 2014, with another third don't yet know what the impact will be.
Papa John's CEO John Schnatter told shareholders during a conference call last week that the health care reform will cost the company an additional 11 cents to 14 cents per pizza, which equates to 15 cents to 20 cents per order.
McDonald's Corporation (NYSE: MCD) voiced similar concerns. The world's largest restaurant chain's CFO Peter Bensen said during a conference call in late July that complying with the health care law will cost as much as $420 million annually. McDonald's will likely raise its menu prices when the law goes fully into effect in 2014 to cover the health costs, according to CFO Journal.
"With health benefit cost already rising at twice the rate of general inflation, an additional increase of 3 percent or more will be very tough for employers to absorb," Sharon Cunninghis, leader of Mercer's U.S. Employee Health & Benefits business, said in a statement.
Read more: http://www.ibtimes.com/health-care-reform-hit-low-paid-part-time-workers-hardest-study-746518
Employers in the restaurant and retail industries -- those with a large number of hourly wage workers who traditionally had minimal or no health insurance -- are more likely than other companies to drop their health plans or cut worker's hours in order to maintain their already slim profit margins.
According to a Mercer survey of 1,203 employers, nearly half of retail and hospitality employers expect the health care overhaul to push up cost by at least 3 percent in 2014, with another third don't yet know what the impact will be.
Papa John's CEO John Schnatter told shareholders during a conference call last week that the health care reform will cost the company an additional 11 cents to 14 cents per pizza, which equates to 15 cents to 20 cents per order.
McDonald's Corporation (NYSE: MCD) voiced similar concerns. The world's largest restaurant chain's CFO Peter Bensen said during a conference call in late July that complying with the health care law will cost as much as $420 million annually. McDonald's will likely raise its menu prices when the law goes fully into effect in 2014 to cover the health costs, according to CFO Journal.
"With health benefit cost already rising at twice the rate of general inflation, an additional increase of 3 percent or more will be very tough for employers to absorb," Sharon Cunninghis, leader of Mercer's U.S. Employee Health & Benefits business, said in a statement.
Read more: http://www.ibtimes.com/health-care-reform-hit-low-paid-part-time-workers-hardest-study-746518
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