Mind Uncharted Explore. Discover. Learn.
Los Angeles restaurant under fire for adding 4% health insurance surcharge
A Los Angeles restaurant recently faced backlash after adding a 4% service charge onto every bill to cover staff health insurance. A photo of a restaurant bill with the surcharge went viral on social media, sparking a debate about the fairness of passing on health insurance costs to customers.
Many online commentators criticized the restaurant, calling the surcharge “absurd” and suggesting that the restaurant should raise prices instead. Some even accused the restaurant of committing price fraud. However, this practice is not uncommon in the industry. According to a survey by the American Restaurant Association, 15% of restaurant operators plan on adding surcharges and fees to combat rising costs. Diners have also experienced other surprise surcharges, such as charges for general service and tap water.
In response to the backlash, the owner of the restaurant, Zach Pollack, defended the surcharge, claiming that they were not the only restaurant implementing such fees. He explained that the surcharges were a result of the Affordable Care Act, which requires small businesses with 50 or more full-time equivalent employees to offer health insurance coverage.
Health care costs are a significant burden for many Americans, with households spending an average of 8.1% of their annual income on health care. Given the expense, it is not surprising that people are searching for ways to reduce the burden.
One way to offset health care expenses is by setting money aside in a health-focused savings account, such as a health savings account (HSA). When used alongside a high-deductible health insurance plan, an HSA allows individuals to set aside tax-free money for medical expenses. This can include health insurance deductibles, copays, prescriptions, and other health-related expenses. The advantage of an HSA is that deposits, earnings, and withdrawals for health-related expenses are tax-free.
Another way to reduce health care costs is to routinely shop for deals on private health insurance. Similar to other types of insurance plans, it is possible to find better deals by shopping around and comparing prices. While employer-sponsored health insurance options may be limited, those who purchase private health insurance should regularly explore other providers to find more affordable options or plans with expanded benefits.
It is also important to maintain healthy habits to reduce the risk of developing health-related complications. Regular exercise and a nutrient-rich diet can significantly lower the likelihood of incurring expensive tests and treatments. A study conducted in 2021 found that starting regular exercise before or during middle age can save individuals between $824 to $1,874 annually on health care costs after retirement. Additionally, maximizing existing health insurance benefits and scheduling annual physical exams can help identify and address health concerns early on, potentially avoiding unexpected health care costs.
In conclusion, while the controversy surrounding the Los Angeles restaurant’s health insurance surcharge continues, it is clear that health care costs are a significant expense for many individuals. Exploring options such as health savings accounts, shopping for better insurance deals, and maintaining healthy habits can help offset these costs to some extent. However, finding an immediate and cost-free solution remains a challenge for many Americans.
