Charleston restaurants brace for Affordable Care Act

  • Posted: Thursday, June 13, 2013 6:02 p.m., Updated: Friday, June 14, 2013 8:47 a.m.
Waiters like Josh Ortiz have traditionally never been offered health insurance from their employers, but that will change next year. He works at Charleston Crab House on James Island on Thursday. (Wade Spees/postandcourier.com) Buy this photo

The price of the Charleston Crab House’s $26.99 “World Famous Crab House Crab Pot” could go up next year, but not because of the price of crabs or a potential seafood shortage. It’s about health care.

What businesses will be affected?

In 2014, the federal government will penalize large employers who do not offer affordable health insurance plans to full-time employees who work 30 hours or more each week.

The law defines “large” as any business that employs the equivalent of 50 or more full-time employees. The working hours of two part-time employees could equal those of one full-time employee.

John Keener, who owns both Charleston Crab House locations, on James Island and on Market Street, is one of many Charleston restaurateurs trying to make sense of the federal Affordable Care Act and how his business will be affected.

Two things are certain: Keener will need to offer his employees health insurance starting in 2014, and he will likely pass the associated costs of that coverage on to his customers.

“Menu inflation is the only way to cover it,” said Keener, who helped organize a health care committee for the Greater Charleston Restaurant Association this year. The committee held a meeting for restaurant industry insiders at the Culinary Institute of Charleston on Thursday morning.

“We’re here today not to fight the act, not to fight the law, not to figure out how to get around it, but how to comply with it,” Keener told the group.

The Affordable Care Act, President Barack Obama’s national health care law, requires businesses with the equivalent of 50 or more full-time employees to offer an affordable health plan or face stiff penalties.

The law will especially sting restaurants, part of the labor-intensive hospitality industry, that have traditionally not offered part-time employees, like wait staff and busboys, health benefits.

“It takes a lot of people to run a restaurant versus a law office that has five or six employees. We need 60, 70 employees to run a restaurant, even the small restaurants. It affects us tremendously,” Keener said.

Jermaine Simmons, 36, a prep cook at Charleston Crab House on James Island, doesn’t have health insurance now and said he doesn’t know if he will enroll next year, even if he faces an individual penalty for not signing up.

“I don’t even know how high (the cost of insurance) would be,” Simmons said.

He’s not alone.

The Charleston restaurant industry employs an estimated 20,000 people, but only about 20 business owners attended the committee meeting Thursday on health care reform.

Colin Smoak, a benefits consultant who spoke on a panel of experts at the meeting, said he was “shocked and a little disappointed” by the turnout. Like it or not, he said, health care reform is coming down the pipeline.

Chef Robert Carter of Carter’s Kitchen in Mount Pleasant asked a question during the meeting on everyone’s mind. “What are the chances of this thing being repealed?”

Smoak touched the tip of his index finger to his thumb to form a small circle and held up his hand. Zero.



Reach Lauren Sausser at 937-5598.





Editor’s note: Previous versions of this story listed an incorrect location for the Charleston Crab House.

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