Restaurants are starting a controversial practice in San Francisco by adding health insurance charges to customers’ bills. Instead of increasing the price of menu items, restaurants are just tagging the charge separately on the bill.
This price hike stems from Healthy San Francisco which provides uninsured residents access to affordable and ongoing health care services. Uninsured residents who are not eligible for other public programs can join Healthy San Francisco. Some residents have even dropped private health insurance to sign up for this generous program, which includes prescription drugs, diagnostic and mental health services, and specialty and inpatient care.
Healthy San Francisco helps many residents every year, but the cost of this program is shifted to employers who are mandated to contribute. Restaurant owners have had enough of the charges and are now just adding them to the menus and bills.
Restaurant owners are defending this practice by saying the extra charge will let customers know how much employee’s health coverage costs. Restaurants are going so far as to put notices on their menus so that the charge isn’t hidden or a surprise to customers.
How will consumers react to this new charge?
In the present hard economic times, it may not seem natural to add on extra fees for consumers. Many people are trying to save money and may not appreciate the charges.
The practice of fees is common in other industries like the travel and hospitality industry. Airlines add fuel charges, hotels add housekeeping bills but restaurants adding health insurance costs? It doesn’t seem normal.
The Chicago Tribune is worried that this practice will catch on quick to other restaurants. They believe that employee health insurance costs are no different than electricity, property, rent and other costs that are necessary to run a business. There is nothing to stop restaurants from adding those charges as well.
Hopefully the practice of adding health insurance charges stays in San Francisco.