Health Care Provisions to Prompt Cuts

Restaurants and retail stores will likely cut back on employee plans or hours due to new healthcare provisions in 2014.

Retail and restaurant industry employers will likely drop their health coverage plans or cut employee hours in reaction to requirements taking effect in 2014, according to a new Mercer study. Just under 50% of retail and hospitality employers say they will have to make changes to accommodate the law, and 9% are planning to drop their existing health plans. According to McDonald’s CFO Peter Bensen, the new law will cost each of the company’s restaurants between $10,000 and $30,000 annually.

Retail employers with 50 or more full-time workers may also cut employee hours to duck the requirement that they offer qualifying coverage. More manufacturing employers, on the other hand, said they would expand their health coverage to meet new requirements.

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For more on health coverage, read Employees Favor Employer Health Plans (Even as Some Employers May Dump Them).

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