Health Care Top Concern of Indies: Survey

Independent grocers are most concerned about the financial impact of the changes to health care insurance mandated by the Patient Protection and Affordable Care Act (PPACA), according to the 2012 Independent Grocers Financial Survey, released this month by FMS and the National Grocers Association (NGA). The survey ranks eight political issues from one (most important) to eight (least important), and the effect of health care reform topped the list by a wide margin.

“Health care insurance costs among independent grocers increased by an average of 7.0 percent in 2011, and 77.4 percent expect further cost increases this year,” noted Bob Graybill, president and CEO of Baltimore-based FMS. “Despite year-over-year cost increases, 47.3 percent of independents fully absorbed the additional expenses, and another 44.4 percent shared the cost increases with the employees.”

As it is, health care costs account for an average of 1.5 percent of sales, with an average per-employee cost of $6,153 last year.

Among the other issues worrying independents are the budget deficit and deficit spending, with an average score of 3.9; swipe fee regulation (despite the passage of the financial reform legislation), at an average of 4.1; and the looming crisis regarding income, Medicare wage, estate and other taxes, with current rates, as well as 40 tax provisions, set to expire at the end of 2012.

“NGA has worked nonstop through grass-roots action, meetings with key legislators, testimony submitted to congressional committees and in-district meetings with constituents,” said Peter Larkin, president and CEO of Arlington, Va.-based NGA, “all in an effort to press Congress to take action by extending these provisions for at least one year. Many of our members run family-owned businesses that could be greatly affected by the potential changes in estate and other taxes.”

The survey’s full Political Concerns Index 2012 is as follows: health care reform (average score of 3.1), budget deficit and deficit spending (3.9), swipe fee regulation (4.1), job stimulus/unemployment policy (4.2), the 2012 presidential election (4.5), energy policy (4.9), the estate (death) tax (5.7), and immigration reform (5.9).

Along with an in-depth review of the political and economic landscapes, the 2012 Independent Grocers Financial Survey features operational and financial benchmarks, in addition to sales, margin and profit data by region, store sales volume and profit leaders. The survey, which can be purchased online, is based on data from 123 independent grocers.

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