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NCCR Laments Health Care Law’s Impact on Chain Restaurants Two Years after Enactment

For Immediate Release
Stephen E. Schatz (202) 626-8119

NCCR Laments Health Care Law’s Impact on Chain Restaurants Two Years after Enactment

WASHINGTON, March 22, 2012 – The National Council of Chain Restaurants today said significant deficiencies in the Patient Protection and Affordable Care Act (PPACA) continue to burden the chain restaurant industry two years after the law’s enactment and urged Congress to take action to respond.

“On the one-year anniversary of the enactment of the new health care law, we rang the bell about the damaging impact the law’s employer mandate and related penalties will have on chain restaurant operators and their small business franchisees,” NCCR Executive Director Rob Green said. “Two years in, the industry still doesn’t have relief from the most pressing challenges created by the law. First and foremost, we continue to ask how chain restaurant employers – who operate on exceedingly thin profit margins – will be able to afford to comply with the law while still trying to create jobs and contribute to economic growth.”

In late 2010, NCCR initiated a productive and ongoing dialogue with the Obama Administration regarding several specific problems with the law. Central among chain restaurant operators’ concerns are the law’s requirement that most large employers and their small business franchisees provide health insurance at government-mandated levels for full-time workers beginning in 2014, its definition of 30 hours a week as full-time work, and unrealistically short waiting periods before new workers become eligible for coverage.

Green said the regulatory discussions have been fruitful and appreciated but, “There’s only so much the regulation writers can do to help. They are hamstrung by a statute that was fatally flawed from the start.”

“Congress should repeal PPACA and replace it with true health care reform that lowers costs and makes it easier for employers to provide health care insurance coverage to their employees,” Green said. “That was the message we delivered to lawmakers during the health care reform debate and it’s our message today – effective reform must bring about lower costs so that as many employers as possible can offer insurance to their employees.”

Concerns about PPACA are being expressed by industry CEOs and restaurant operators alike, and Green said industry stakeholders are unanimous in their assessment that PPACA will stunt growth in the chain restaurant industry. If left unchanged, the law will drastically impact job creation by forcing restaurant companies to transition employees from full-time to part-time status in order to avoid the enormous financial burden of the statute. In addition, some chain restaurants have reported that PPACA will completely wipe out annual profits once it is fully implemented.

“The magnitude of damage that PPACA will inflict on chain restaurant operators and their small business franchisees can’t be overstated,” Green said. “Make no mistake, the law as currently written will kill jobs and impede economic growth for years to come.”

The National Council of Chain Restaurants is the leading trade association exclusively representing chain restaurant companies. For more than 40 years, NCCR has worked to advance sound public policy that best serves the interests of both chain restaurants and the millions of people they employ. NCCR members include some of the country’s largest and most respected quick-serve and casual dining companies. The National Council of Chain Restaurants is a division of the National Retail Federation, the world's largest retail trade group. www.nccr.net