Restaurant Chain Adds Surcharge for ObamaCare

Gator's Dockside in Florida charges customers an extra 1%

By John Johnson,  Newser Staff

Posted Feb 27, 2014 5:33 PM CST

(Newser) – An otherwise nondescript restaurant chain in Florida is suddenly national news thanks to a new policy: Gator's Dockside has added a 1% surcharge to cover the costs of the Affordable Care Act, reports CNN Money. Participating restaurants aren't trying to hide it, either. "The costs associated with ACA compliance could ultimately close our doors," reads a sign to patrons. "Instead of raising prices on our products to generate the additional revenue needed to cover the costs of ACA compliance, certain Gator's Dockside locations have implemented a 1% surcharge on all food and beverage purchases only." An executive with the chain estimates that it will cost $500,000 a year to provide all its workers with insurance when the employer mandate kicks in next year, and she figures the surcharge will bring in about $160,000 annually.

  • Dumb move: "Obviously, the restaurateur is thinking about this from the perspective of an angry talk-radio-listening Republican rather than that of a hard-headed capitalist," writes Jonathan Chait at the Daily Intelligencer. "There are costs associated with all kinds of government regulations and spending, but he’s not creating a line item on his tab to highlight his share of, say, financing the Department of Defense."
  • Smart move: "As the surcharge shows, Obamacare is no free lunch," writes Katrina Trinko at the Heritage Foundation. "Most businesses probably won’t opt to add a specific surcharge in order to cover their new health care costs, but some will certainly raise prices—or reduce quality of their products. Obamacare hasn’t driven down the costs of health insurance, or found a magical new source to cover those costs."
  • Similar move: Eater notes that a popular Los Angeles restaurant, Republique, asks diners to pay a 3% surcharge for employee health care costs. The restaurant makes it optional, however, and says it is not specifically tied to the new law's mandates.

An image of a receipt with the ObamaCare surcharge.
An image of a receipt with the ObamaCare surcharge.   (Gator's Dockside via CNN)
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