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Small business spends months preparing for Affordable Care Act

Updated: Tuesday, September 24 2013, 10:23 PM MDT
By: Melissa Gundersen
EL PASO, Texas – On Oct.1st, a major part of The Affordable Care Act, more commonly known as Obamacare, will take effect. One small business owner in the Borderland said he's been preparing for the change for months.

The new legislation will mostly impact businesses with more than 50 employees. The Lunch Box, which has two locations in El Paso, fell under that category.

The owner, Martin Rios, said he started scrambling after researching the new legislation, because he currently doesn't offer his employees health insurance benefits.

Rios said he can't afford to offer his employees health benefits, even under The Affordable Care Act.
"In looking at the cost of some of the insurances that we were looking at, a lot of the prices were coming in at about $250,000 or $300,000 a year. … We would be barely breaking even," said Rios.

Rios said, to prepare for the change, his family split the two locations. Now, each restaurant falls under different owner.

"My brother kept the one restaurant, and my sister and myself kept the other one," said Rios.

Rios said each restaurant has 48 employees, so he isn't required to provide health insurance benefits to his employees.

"To be fair to the employees… we just gave everybody a $1 raise so it would offset some of their costs when they go off to the insurance market place," said Rios.

The only downside is Rios can't expand.

"Leo's you know they have six restaurants. So we wanted to expand the same way, but unfortunately now with this health bill it's pretty much difficult to do that so I guess any future expansion is right now off the table," said Rios.

If an employer with more than 50 employees does not provide health benefits by 2015, it will face penalties.

Legislators said for businesses with fewer than 25 employees, they may be offered incentives, such as tax breaks and tax credits, to help them pay for and provide benefits.

Most small business owners in the borderland, however, told KFOX 14 they plan to keep everything the way it already is.
Small business spends months preparing for Affordable Care Act


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