Single-payer health insurance may be just what these restaurateurs ordered

PROVIDENCE, R.I. — Last winter, James Mark was a 2018 James Beard Award finalist. A few months later, both GQ and Bon Appétit ranked Big King, his newest Rhode Island restaurant, as one of the country’s best places to eat.

But in 2018, the chef and restaurateur spent almost double his personal income on health insurance for his employees: $54,000 to cover a dozen or so people, compared with the $35,000 he paid himself.

Mark spends most of his time at the self-identified “small and strange” Big King, his experimental Asian restaurant on Providence’s trendy West Side, where the handwritten menu changes daily. At downtown’s Dean Hotel, he runs the small cocktail bar and the no-reservations North, which serves dishes like fried kabocha with pumpkin miso. He employs fewer than 50 people, so he isn’t required to provide health benefits. But he thinks it helps with staff retention and is the right thing to do.

That’s why Mark, who studied at nearby Johnson and Wales University and trained in restaurants both here and in New York City, has joined a growing chorus of small-business owners to support Medicare for All or some type of government-sponsored universal health plan.

The beef is not just about the financial burden. “I could make a lot more money if I didn’t have to pay that,” he said from Big King, a narrow eating space where bottles of golden Japanese whisky and clear sake glimmer against the dark wood paneling. It’s also the confounding choices and hours of administration for which Mark feels at best underqualified. Though he tries to pick a good option, he reflected: “I have no idea if it’s a good [health] plan or a bad plan, in comparison to everything else.”

While industry groups have largely opposed the idea of a single-payer system, worrying it would mean tax hikes, some individual owners are open to the idea.

Mark — and others of his kind — conclude they would accept higher taxes if the government would take over the herculean task of insuring their workers.

Not everyone agrees. The National Restaurant Association opposed the Affordable Care Act and other Democratic reform efforts that were less sweeping than the single-payer approach but did require employers with 50 or more workers to offer insurance. Today, the trade group doesn’t have a specific stance on Medicare for All, though a spokesperson pointed to concerns about the eventual tax burden its members could face.

The National Federation of Independent Business, a Washington-based advocacy group for small-business owners, offered similar worries about the tax hikes likely paired with this system. An internal survey of NFIB members showed 75% opposed single-payer, often citing payroll tax increases as their concern.

Aaron Frazier, the National Restaurant Association spokesperson, suggested that members could get a better health insurance deal by using the group’s association health plan, which is collectively negotiated by the trade group.

Association health plans — a longtime favorite Republican concept — are a cornerstone of the current White House’s health policy. But they remain controversial and are often held to less stringent coverage standards than other forms of insurance since they may have caps on coverage spending and may not cover some of the Affordable Care Act’s “essential benefits,” such as maternity care and prescription drugs.

A middle ground, proposed by many Democratic presidential candidates, might be a “public option,” a government-run health plan that individuals — or their employers — could pay to join if they didn’t like their other options.

That approach could still “go a long way” in addressing some of the concerns restaurant owners outlined, said Linda Blumberg, a health policy fellow at the Urban Institute, a Washington think tank.

Those restaurant owners who insure their staff usually face a hefty expense and hours navigating the byzantine world of health insurance.

“It was a lot of bureaucratic stuff that I didn’t really understand. My focus is in the kitchen,” said Richard Wall, who owns Both Ways Café and Catering in Seattle. He hired a broker but reviewed only a few plans before picking one to offer employees. The process was “confusing.”

On the 2020 campaign trail, presidential candidates Bernie Sanders and Elizabeth Warren talk about how their plans would replace the current, private insurance system with a single, government-run program. Their proposed systems would eliminate most cost-sharing, so patients pay very little out-of-pocket, and would be financed through taxes.

Rather than focusing on these details, these restaurateurs emphasized the result: having the government guarantee coverage to everyone.

“We would all, everyone involved, be positively affected,” argued Daniel Myers, who co-owns Loyal Nine, a spacious cafe by day and restaurant by night in Cambridge, Mass.

Loyal Nine insures about a dozen employees, who must meet a $3,000 deductible before coverage kicks in. It also employs fewer than 50 people. But, Myers argued, subsidizing coverage makes sense. Employees are more likely to stay because of health insurance.

It’s a big expense, though. Myers estimates 10% of his payroll goes to health care. His business is too small to bargain with the insurance company. So each year, the price goes up. The variable is by how much.

“You’re pushed up against a wall,” he said. “We have no ability to negotiate our prices.”

Kaiser Health News is a national health policy news service. It is an editorially independent program of the Henry J. Kaiser Family Foundation, which is not affiliated with Kaiser Permanente.