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Healthcare FAQs for Restaurants #2

May 15, 2013

You ask and we answer. The following questions and answers are a result of responses we received from the earlier round of FAQs.

Health Care FAQ's For Restaurants

Q.  My restaurant has fewer than 50 employees and I offer insurance but only to my senior staff. Since we’re under 50 and exempt from the employer health care mandate, can we continue to offer to only some of our staff?

A.  The short answer is no. The long answer is that certain insurance reforms in the Affordable Care Act will apply to all employers, including those with fewer than 50 employees. If you offer a health plan you must offer coverage to everyone to adhere to non-discrimination rules.

Non-discrimination refers to the offering of different levels of coverage to different segments of your staff. You would be in violation of these rules if, for example, you offered any level of coverage to your full time management staff, but none to your hourly full time staff. Additionally, if you decide that you cannot cover all of your staff and plan to forgo coverage for your entire staff you should be making that decision now to ensure that coverage is not “rescinded” from any employee after the new rules go into effect. Consult with your insurance provider to plan for this transition.

If you offer coverage you must also cover those with pre-existing conditions, you cannot impose annual/lifetime limits on coverage, you cannot rescind coverage, and you must allow children to remain on the parent’s plan until age 26. Other rules include placing a 90-day limit on maximum waiting periods, and offering a “plain English” summary of your benefits and coverage to employees.


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Q. There are five restaurants trading under the same name in our group but each restaurant was set up individually with a different mix of investors, and that have been accounted for and that we have filed taxes for each separately. Would we be considered under “common control”?

A. This is an issue that cannot definitively be answered in a forum such as this. It is critical that you consult with your tax professionals to ensure that your individual restaurants meet all the requirements set out in the IRS code to be either defined, OR NOT, as under common control.

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Q. I have heard that the Federal Government is missing some deadlines and delaying some requirements. What are they and how will this affect my business?

A. There have been two significant rollbacks so far by the Federal Government that you should be aware of:

  • At the end of 2012, the US Department of Labor announced that it would not be ready to send required information kits to employers to comply with a March 1 deadline to begin the process of informing employees of their health benefit options. The delay has pushed the release of the information kits to early fall which will be very close to the October 1 beginning of open enrollment. As updates on the information kits comes available we will relay to you.
  • The other rollback involves plan choice on the Exchanges by employers of 50 or more employees. Although you, the employer, are to make a choice from the plans offered in three “metal” tiers of coverage that you are willing to cover, Bronze (60%),  Silver (70%), Gold (80%), Platinum (90%) (the percentages indicate the percentage of total medical costs that on average, are expected to be paid by the health plan), your employees were to have had the choice of any plan from any provider on the Exchange. The logistics of administering a system such as this will be, understandably, monumental and the Federal Government has acknowledged that it is not up to the task in the time it had given itself. So, for at least the first year, employee choice will be limited to the plan that you, the employer, choose to participate in.


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RAMW Endorsed providers are here to help

Holly Miller
Direct Line: (703) 205-8715
Toll Free:    (800) 792-9800

Download the Webinar Slides from USI

PAYCE Payroll Service
Brian Pfeifer
Direct Line: (443) 279-9000


More Healthcare FAQ's from RAMW

General information on the Affordable Care Act and its impact on restaurants visit the National Restaurant Association Health Care site and Health Care: Next steps for Restaurateurs.

DC Health Care Exchange Authority

Maryland Health Care Reform

Virginia Health Reform Initiative