SACRAMENTO Calif. Restaurateurs in California who employ more than 10 people would be required either to provide health insurance or pay 4 percent of their payroll to a special fund under a proposal aired Monday night by Gov. Arnold Schwarzenegger.
The fund would be used to reduce the price of health insurance for California residents and immigrants - legal or illegal - who are not provided with the benefit through their jobs.
The Republican governor predicted that his proposal would “create a model that the rest of the nation can follow.”
“We are going to make history,” he said.
Craig Miller, chief executive of Ruth's Chris Steak House, does not disagree. "You would expect California to lead the way in initiatives like this," he said, "and as California goes, others will follow. The industry needs to be out in front of this." Although the 97-unit high-end steakhouse chain is based in Orlando, Fla., California is its second-largest market.
California has more restaurants than any other state in the nation. The California Restaurant Association had yet to respond to Schwarzenegger’s plan by press time.
Ruth's Chris is one of the many operations during business in the state that already offers health insurance to its employees. "Companies that do not offer benefits -- it will clearly have a greater impact on them than on those of us that do," said Miller, who is also on the board of the National Restaurant Association. "Still, any mandated increases in wages or benefits obviously will get passed on to the consumer."
Proposals to expand healthcare insurance coverage are also being considered in New Jersey, and New York Gov. Elliot Spitzer, a Democrat, has called for extending coverage to all children. Massachusetts passed a health-insurance reform package last year.