The fight over Obamacare, so far held at the 30,000-foot level, is about to hit home. The latest impact hot off the grill: prices of burgers and hot dogs at Five Guys, the national chain that started in Washington, are going to rise to cover the president's mandated insurance coverage.
"Any added costs are going to have to be
passed on," said Mike Ruffer, a Five Guys franchise holder with eight of
the popular restaurants in the Raleigh-Durham, N.C. area. He will need
all the profits from at least one of his eight outlets just to cover his
estimated added $60,000-a year in new Obamacare costs.
What's more, he's iced plans to build another
three restaurants until after the administration explains the exact
rules and penalties employers will face. The law's plan to have those
available March 1 has been pushed back to October.
"I'm kind of in a holding pattern," said
Ruffer, a former Marriott executive who added that many franchise owners
are in a similar situation.
Ruffer was the star witness at a Monday
Heritage Foundation seminar on the impact Obamacare will have on small
businesses. He is typical of many: Because he has enough full time
employees to activate the law, he faces either coughing up the money to
provide health insurance or paying a fine of up to $3,000 per worker.
Ruffer initially thought he would escape the
law because he created each restaurant as its own company. But the law
doesn't recognize that distinction, so now he's trying to determine if
he can fire enough workers, or cut enough hours, to slide out of the
grasp of Obamacare.
He said that "scorched earth plan," however,
would hurt his restaurants, so Ruffer is likely to either pay the fine
or buy insurance. But spreading the costs over his basic menu of fries,
drinks, burgers and hot dogs, could scare off customers, he worries. He
said that the recent spike in gas prices cut into his profits since
fewer people were stopping at his restaurants.
And the health care law isn't only going to
hit Ruffer. He's quizzed his workers to ask if they understand that they
will be fined if they don't get health insurance. Just one of 20
workers were aware of the $95 tax penalty that rises to $695 by 2016.