Subway CEO says don't worry about Obamacare
He argues that while it will make his industry less competitive, at least all operators are facing the same problem.
"It’s going to affect the food business and it’s going to make it less competitive, compared to eating at home, for instance," he said. "But probably every operator will have to deal with this. It will be an extra cost on the average hour that you have to pay for. And probably people will raise their prices and pass it on to the consumer."
Dunkin' Brands (DNKN) and other companies that depend on part-time workers are lobbying the Obama administration to relax requirements that they provide health insurance for people who work as little as 30 hours per week. Employers with 50 or more workers are required to offer what's known as "minimum essential" health insurance. Critics say the mandate would create onerous financial burdens on many businesses.
For Subway, Obamacare would apply to franchisees with multiple locations becaues the typical store has about 12 employees. The closely held Milton, Conn., company is taking a more measured tone toward Obamacare than others in the restaurant industry with good reason. As NBC News recently noted, Papa John's (PZZA), Denny's (DENN) and Applebee all saw their reputations suffer among consumers because of critical comments their executives made about the Affordable Care Act.
Speaking later on CNBC, Deluca said Obamacare was the "biggest concern of our franchiees because they don't have enough information" on its potential impact. Their unease understandable. A company spokesperson could not be immediately reached for further comment.
As my colleague Aimee Picchi recently noted, employers pay about $4,664 to insure a single worker and $11,329 for a family on a yearly basis, which is far more expensive than the $2,000 per worker penalty companies face for not following Obamacare starting next year. Many critics say business will find it financially sensible to pay the penalties rather than provide health insurance.
According to data from the Congressional Budget Office cited by the Heritage Foundation, a conservative think tank, Obamacare will result in 6 million fewer Americans enrolling in employer coverage by 2016. However, the nonpartisan FactCheck.org disputes the idea that Obamacare is a "job killer."
"As we’ve said before (a few times), experts project that the law will cause a small loss of low-wage jobs -- and also some gains in better-paid jobs in the health care and insurance industries," FactCheck says. "Furthermore, some small businesses with fewer than 25 employees are already getting tax credits under the new law to help defray the cost of providing worker coverage."
The debate over Obamcare's impact on the economy won't be over for a long time.
--Jonathan Berr doesn't own shares of the listed stocks. Follow him on Twitter @jdberr.
Personally the health care law is great though has flaws.. if the govt is going to mandate everyone to be insured with health coverage then tin return must put caps on what insurance can charge for premiums and also medical facilities must also have their price capped and in uniform set prices.. for example if person comes with no coverage has to pay up to 4 times fo what insurance and other coverages pay including medicare. Ever since Obamacare has been inacted it also gave teh insurance company the green light to raise their premiums to an exorbant amount which makes it impossible for most americans to afford. I would be willing topay a higher income tax to recieve a free govt national health coverage rather then pay 3 or 4 times the premium I was paying a few years ago.
all hospitals and medical doctors must make their prices equal to all patients regardless fo coverage plans like teh uninsured are often over charged 3 to 4 times of those who have coverage and with those who have coverage it also depends on which plan you have that dictates how much or how less a person has to pay out of pocket
But overall I do believe this law is a good law dispite flaws that still need to be worked out. to make fair and equal to all person of america.
The Health care Insurance companies take in $1 and spend only 60 cents paying health care costs
the rest 40 cents out of each $1 made goes to pay their executives $300,000,000 a year each.
Huge profit margins in the insurance companies.
Same is true of the hospitals and doctors offices.
Only about 5 cents of health care dollars spent really go to treatment of sick people the rest is taken as profit by executives paying themselves $300,000,000 a year.
fast food workers are not real human beings due to the fact everyone thinks they deserve to be pay mininum wage with no benefits.
They might as well be economic slaves.
Gee people think over 80 percent of the new jobs last year were these types of minimum wage jobs.
Hmmm CEO's of fast food companies making millions of dollars a year due to the fact they work people for no money and give them no benefits. Capitalism at it's best.
What happened to making jobs for people that pay $125,000 a year with benefits ???
The whole fast food industry would be better off gone so people could start making more healthy food for themselves.
Our country is so wrong right now.
May be insured but there will not be Dr's around to take care of you
My own idea about health care reform is as follows:
(1) I will import 100000-200000 doctors from overseas. Give them six months training
to acclimate with out system. I will also import more than 25000 nurses. This will create
competition and reduce cost
(2) I will want Government to pay for overseas education for doctors, nurses, dentist. We
can have doctor trained for 50000/doctor vs. 500,000. Particularly we need to target
black and hispanic students who have qualification but could not make it to schools for
one or other reason.
(3) Those who cannot get insurance should be charged certain percentage of Paycheck tax
and provided insurance for which Government will pay premium to private company or
enroll them in medicare.
(4) End of life reform to reduce cost should be considered. We should have national dialogue
that takes into account cost and benefit. I would like to have a steak in fancy steak house but it
it is beyond me and I do to have it. We need national dialogue that deals with affordability issue
even when conventional moral dictates we should meet the need.
America was founded in realism, competition, hard work and thrifty lifestyle. Those are American values. When we try to outdo Jesus, we are digging a hole for ourselves.
I hope the grunts of society are paying attention to the words spoken by the companies that praise you for your menial service.
"we will do everything in our power to seek out every loophole and dark corner to make absolutely sure we have no obligation to your health. Live, die or suffer, we do not care. Just don't do it on our dime"
Hogwash? Let's see how many American employees get 29 hour workweeks.
If i have money [rather job] i will go to restaurant or do shopping. If no income then no
spending. Money making people will spend surely,hence economy will start rolling.that's
the simple theory of economics. You donn't need Pundits to explain that. Higher wages
means more money,hence more spending.Corporations and CEO's make more money
on huge turnover. Everybody is happy.
I am all for healthcare reform just not caring for Obamacare has it is written. The reform did not address the real problems and now there is a growing number of groups being exempted from it. If its good for one it should be good for all. The reform did not address the causes of rising healthcare which is why we still see insurance rates increasing. My rates went up another 9% this year with no claims in the past three years. Not even a doctors visit.
Many of you are focused on just the fast food industry that this article refers to. Fact is though everything will go up to cover cost. Wages will remain stagnant until employers can figure out how best to pay for this and companies will run very lean. The premise behind Obamacare sounds good until you look at all the cost. No doubt the reform has some great things in it but overall the bill is a job killer.
The overall cost to the worker will be greater than you think. First the workers wages will remain flat. The cost of services and products will increase has employers start to pay for the requirement. This means you make the same and will be able to pay for less. I am not saying get rid of Obamacare but rather overhaul some of the provisions and go after the causes that create the increases in insurance.
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