While many restaurants don't offer health coverage, McDonald's provides mini-med plans for workers at 10,500 U.S. locations, most of them franchised. A single worker can pay $14 a week for a plan that caps annual benefits at $2,000, or about $32 a week to get coverage up to $10,000 a year.A Add the McDonald's employees to those 22,000 New England residents who are losing their Medicare Advantage coverage from Harvard Pilgrim. h, more unintended consequences from ObamaCare. And more people whose insurance will be dropped due to the Democrats' tinkering with the national health care system. And the results aren't impressive.
Last week, a senior McDonald's official informed the Department of Health and Human Services that the restaurant chain's insurer won't meet a 2011 requirement to spend at least 80% to 85% of its premium revenue on medical care.
McDonald's and trade groups say the percentage, called a medical loss ratio, is unrealistic for mini-med plans because of high administrative costs owing to frequent worker turnover, combined with relatively low spending on claims.
Democrats who drafted the health law wanted the requirement to prevent insurers from spending too much on executive salaries, marketing and other costs that they said don't directly help patients.
McDonald's move is the latest indication of possible unintended consequences from the health overhaul. Dozens of companies have taken charges against earnings—totaling more than $1 billion—over a tax change in prescription-drug benefits for retirees.
More recently, insurers have proposed a round of double-digit premium increases and said new coverage mandates in the law are partly to blame. HHS has criticized the proposed increases as unwarranted.
Thursday, September 30, 2010
Remember all those promises about how no one was going to lose the health care they have under ObamaCare. Well, here is more evidence about how that is just not true. McDonald's is going to drop the health plan for its workers because of the way that the ObamaCare law was written.