Small Business Owner Fears Obamacare's Impact on Jobs and Economy

In 2006, when Indiana small-business owner Scott Womack purchased a development agreement to expand his IHOP franchise into Ohio, he had no idea Congress would pass a massive overhaul of the health care system four years later.

Today, one year after that legislative overhaul became law, Womack is very aware of Obamacare -- and of its effects on his plans for growth.

Under the year-old law, Womack must provide health insurance to all full-time employees beginning in 2014. Right now, he employs nearly 1,000 full- and part-time workers and already offers insurance to his management staff. He simply does not know how he'll generate the revenue to do more.

Womack estimates the cost of the law to his company will be 50 percent greater than his company's earnings -- in other words, beyond his ability to pay.

That's not because his company of 12 IHOP restaurants in Indiana and Ohio is unprofitable. Quite the opposite, in fact. By industry standards, he's doing well. But labor-intensive restaurants generate profits of just 5 percent to 7 percent per employee.

With fears about how he'll afford to provide health insurance with those low profit margins, Womack is worried about his expansion plans in Ohio. He can't exactly cancel his development agreement. But he'll only be able to fund his new restaurants -- and the construction, real estate and manufacturing jobs that would go along with them -- if Obamacare is repealed.

"If the health care reform law is not repealed or if the employer mandate doesn't go away, we're going to have to take drastic action," Womack explains.

From his perspective, the law represents Congress' fundamental misunderstanding of important differences among industries. He's frustrated that so few lawmakers sought input from people like him -- but he's doing what he can to speak up now to offer a glimpse into the law's effects on small-business owners.

[cheeseburger]

Nothing like increasing the cost of having employees in times of high unemployment.

[guythefixer]

Well Mister Womack stop getting use to the bread line again. Your just using your employees. So that's the way it is in America. You get richer and your workers pay the price.

[MetalDetroit]

Greed is demanding that someone else pay for your health insurance, something that you should pay for YOURSELF !

[hyetalian]

its because the burden of taxes, regulations, etc. add to the amount of demand needed to stay in business.

[lizardofahaz]

How much is the advertising fee?
International restaurants pay 3% of gross sales for local advertising and 1% of gross sales for a brand-administration fee.

What are the financial requirements in order to qualify for an IHOP franchise?
For international development, minimum financial net worth of U.S. $2.5 million and minimum of U.S. $1.2 million in liquid assets.

[eldershima]

Who would pay the staff at the hospital? What incentive would there be for students to aspire to become doctors? 4 years college, 4 years medical school 3+ years residency... and the whole time getting a 3.5+ GPA in some of the hardest classes at a college + various extracurricular activities?

Right now hospitals don't turn away people that are sick if they go to the emergency room. They take them regardless of citizenship even.

Who is going to pay for what you suggested?

[neongreen]

This is why we need universal single-payer healthcare for all US

[dfrank]

I never said people shouldn't be allowed to have health care, I just don't believe someone else should pay for it. I believe hospitals should be forced to care for all people, not just those who have the money. The hypocratic oath taken by doctors should take precedent, and no hospital should be allowed to turn away someone who is sick. The major problem with health care is that there are many who have top notch health care who abuse the system. That and malpractice are pushing prices higher

[scottdevaney]

Owning my own as well as working for my father's when I was younger it boils down to the companies P/L. The "OWNER" feels his profit should not decline due to his employee's insurance.The United States is on the bottom for benefits for employee's. The truth should come out and say that "McCain" wrote the framework for this bill. The USA can't afford all the ER visits and missed work by employees. This is but an investment into a long term employee. Just facts.Understand totally but it is a fact.

[blvp]

Business owners are RICH, that's how you blame them.

[spamilio]

Someone's health has nothing to do with small businesses. Is it against the law to buy health care?
Without small businesses most of this country will be out of work, the government tax revenues will plummet, and no one will be able to afford health care. You can't buy health care without any money. It's economics; you're trying to appeal to, what, emotions? Someone's health is more important than the state of a small business? It's all irrelevant if there's no money to pay for it.

[farmnurse]

husband's employer helps get health insurance & guess what still cant afford HEALTH CARE. Now cause of Obamacare premiums increased over 40% we pay about $300 a month where we used to pay about $170 and our deductable went from $2500 to $3000. The employer used to pay $1500 of this but now only pays $1000, so basically our share of the deductable doubled. I take migraine meds that cost about $180 for 9 pills so $1000 doesnt go that far and then we have to pay $2000 b4 we get anymore health care

[Charlie]

Do the people in those jobs have enough money to pay for what they need?

[isaMer]

I had breakfast at IHOP this morning. The ladies that have worked there the past ten years looked great and they asked for my Tea Party WDC business card so they could watch my videos :) They know my name and what I order..great experience and food everytime at a great cost.

[Blackgamr]

Pay attention this is how the wealth gap is created and MAINTAINED.

[StoicLion]

I did not know IHOP locations were franchised!

[ChachiTelevision]

I think most people would rather have money in their pockets and have the freedom to choose how they want to use that money rather than passing their money to the government and letting them decide for them.

I'm not saying everyone is a conservative, but I think people do have more of a conservative view than they think.

[Charlie]

Police, firefighters and, roads cost taxes but, no one seems to mind those. I'm not arguing only pointing out the facts.

[isaMer]

Return Medicaid to States in diminishing block grants. This allows States to strip our mandates, reset their Medicaid to fully portable, minimal benefits that pay at market rates and let insurance companies and healthcare providers innovate products for all socio-economic class and address the needs of those with pre-existing, chronic or pallative issues.

[neongreen]

Thanks to "Obamacare" I can actually GET insurance, whereas before I would have been SOL.