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Papa John’s Price Increase: Obamacare Is To Blame

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Obviously, few subjects have been stickier than that of Obamacare, which would require business owners employing 50 or more people to offer affordable health care to those employees or pay a penalty. It’s become a topic of debate between, well, just about everyone, and now, some business owners are coming forward with a new wrench to throw into the machine; higher prices passed on to the customers.

John Schnatter, a.k.a. Papa John, says he’s not in support of Obamacare–he’s been fundraising for Mitt Romney–and that the necessary adjustments Papa John’s will have to make to their business model mean the cost moves on down the line to the consumer. While it’s only estimated to be about an 11-14 cent increase per pizza, every penny adds up, and some franchise owners are concerned that they will be forced to cut jobs to stay within the 50-employee limit.

“I have two options, I can stop offering coverage and pay the $2,000 fine, or I could keep my number of staff under 50 so the mandate doesn’t apply,” Judy Nichols, owner of a Texas franchise, said. “Obamacare is making me think about cutting jobs instead,” she said.

Some think the price increase is so small it probably would have gone unnoticed if not for all the press about it, and Matthew Yglasias, writer for Slate.com, thinks it’s a small price to pay considering what’s at stake.

“Stipulating for a moment that this is true, doesn’t it seem like a rather small price to pay? Papa John’s website is currently offering to deliver me a large pepperoni pizza for $14.08 and Schnatter is warning me that the problem with Obamacare is … a one-time price increase of less than 1 percent! That seems eminently reasonable. What’s more, it’s well within the range of the kind of price swings Papa John’s is going to have to expect just based on the vagaries of the weather, which impacts the price of ingredients, and the ups and downs of the oil market.”

While the law probably won’t affect large, national chains like Papa John’s too much, it may have an adverse affect on smaller businesses, and the National Restaurant Association has warned everyone to expect to see price increases coming soon.

Papa John’s Price Increase: Obamacare Is To Blame
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  • Kathy

    The problem with this article is that the author didn’t really think out the consequences, which is going to be very anti-PJ. To blame this for a price increase that wouldn’t really even be noticed is just ridiculous! There are so many reasons to dislike Obamacare, and this simply isn’t one of them. The main issue with Obamacare, and it’s one that many people choose to ignore, is that health care coverage does NOT guarantee access to health care!

  • confused

    Bob, you are not looking at why healthcare cost so much. Half the people are uninsured, the insured then pay higher prices to keep the healthcare alive. I know first hand how it works. My insurance pays “an allowable” amount, the hospital charges me 3x’s because a papa johns employee couln’t pay his bill. I end up owing because someone has to pay the bill in the end. Hospitals are charging me for other’s healthcare.

    • Bob

      You are simply wrong.

      Even in outpatient situations, prices are crazy high. I had an allergy test, which took 15 minutes, and I was with a RN the entire time, and I was charged $1,500.

      For an allergy test, for crying out loud.

      Nothing serious. Nothing life threatening. But the charge was outrageous for the care I received.

      You can’t tell me I was charged $1,500 by my allergist because so many other people are being given free allergy tests, that I’m paying for. Your logic does not add up.

      • Helene

        Actually that is exactly why your allergy test was $1500. I work in health economics and that is exactly how they recover the difference of those bills which aren’t paid. Where do you think the money comes from? Your entire argument has no logic!

      • Al

        The problem bob is that you have no idea what is going on in the world. The high Health care costs are from uninsured illegals . Just walk down to your local, state funded hospital. I’m there all the time. The ER is their walk-in clinic.

  • Boricua X

    Higher Prices For Crappy Pizza, sounds like a winning formula.

    Oh and Schnatter (or whatever his name is) is a Teabagger.

    He’s just looking to throw dirt on POTUS.

    • John Gamble

      Why? Be cleaner than he is now.

  • ricky cunningham

    After reading this story and all of the comments posted I have to say the real scary thing here is the lack of understanding people have. To say that the president is trying to separate the country then keep on using fake anger to justify overcharging for a product is telling in itself.

    If you take the time to even read the story over half of the comments made show that those people did not our are just Romney supporters trying to help fan the flames of fake anger. In case you somehow missed the main points of the story here they are in a condensed version. I also added in a little common sense information to show the level of deception as well as their lack of respect for their base.

    He already provides health care for his employees so why would he have to raise prices to do something he already does anyway? He is a millionaire and a supporter of Mitt Romney. Of course his comments are politically motivated!! If you can try and find some reason to raise you prices, support someone who is going to save you a bunch on taxes as a rich person, and and blame it all on someone else then that is what I like to call the hat trick. This fake outrage is just another attempt by the opponents of the president to try and deceive people into believing the same old lies that have been proven to be false and just not true.

    Sit there and act like you are outraged over something that you already do is the very definition of shameful and dishonest business tactics.

    How can this guy sit there with that cheesy smile and act like he is experiencing some kind of hardship when there is no way his pizza location has over 50 people employed there? Ever been to a pizza place before? Most are small places with maybe a few tables to sit at.

    It does not take more than 3 people per shift (8 hours) to make pizzas during the busy part of the day. Add to that another 3 people employed as delivery drivers and a store manager you are only talking about 6-12 employees total. This fake outrage is just to re energize their base, and push people who are undecided to vote for them. Talk about Washington or the government controlling you! It is because you are giving them the ability to do just that. What to get mad? Then stop and think for yourself. If you are going to comment on a story at least read it all. In fact reread it a few times if you are not sure you understand the story. Then react. Trust me that so called “anger” is going to feel a lot more real!

    • Joe Ripp

      Anyone that believes the government can provide a service cheaper than the private sector is a fool. Also can anyone tell me of a government program that has worked out the way it was promised?! Social security? nope Medicare? nope the only program that even came close to paying for itself was the WW2 GI bill. They have no idea of the real cost of this program. as to the promise you can keep your current healthcare i ca;; BS Obama is already trying to push the cost up for military and military retirees promised free healthcare to the point they are forced onto Obama rationed care. At the same time he is giving The Muslim Brotherhood, and the Palestinians Billions of dollars from our bankrupt treasury! Anyone that will not admit the care will be rationed need only look at Canada or Britain where the wait times for say a something as simple as a MRI. Obama the nefarious is promising something for nothing and initially resorted to bribery to get it passed. But then we know Obama the nefarious came fro, Chicago Part of Illinois land of the governors that went to prison.

      • Ursa Worlds

        The government if NOT supplying healthcare. It is still provided by private companies.

    • IllinoisCPA

      Only 6 employees per store. But he has more than 10 stores.
      So he is subject to all the rules and recordkeeping requirements imposed under the guise of “health care”.

      He is also subject to more and harsher audits by the expanded IRS to make sure he is obeying those rules.
      Even if he has no changes after the audit he has spent hundreds of thousands of dollars for the audit, in addition to the record keeping expenses.

  • Jimmy

    So a large pepperoni pizza delivery costs $14.
    Makes for a good case to order from a local pizza spot for $9.99 instead of a chain store…

    • GJ

      there you go, supporting the community while you are at it!

  • http://same roger

    you go P.J.

  • William Hill

    Well, let me inform the National Restaurant Association that they’ll see one less customer soon. Restaurant prices are getting ridiculous and that’s before you even consider tipping. I always tip but now I look for restaurants that you don’t ‘have’ to tip, you know, the ones where they take your order at the counter and you do everything else including get your drink. Also, when I do eat at a restaurant with a waiter (that I will tip), I always get water to save myself about $2 to $3 on the soft drink.

  • diego

    This is disgraceful! I agree it’s a political stunt. Shame on you!

  • Dau Tieng 59

    When was the last time the government was low bidder? The government of $500 hammers and $1,000 toilet seats.
    Government healthcare will be as fast and efficient as your local Motor Vehicle Department. “Have a nice day.”

    • IllinoisCPA

      You left out “With the compasion of Attila the Hun (or the IRS)”.

  • GJ

    Happily Boycotting. F U Papa John

  • Tina

    I have worked in the healthcare industry for 10yrs. Hospitals can’t refuse to save a life, even if the patient can’t afford to pay their bill. By the 3rd quarter all -negative accounts are totalled and then divided by all active insured policy holders. In Nov/Dec. while everyone is out shopping and celebrating, your insurance company is preparing your Insurance Increase Notice.

    Yes!!! ObamaCare will cost us more in the initial stage, but overtime it will cost each of us less money. Insurance companies will soon have to compete for your business.

    Many people hate CHANGE and its very hard for them to see the BIG Picture…when they are use to the same ole outcomes.

    Mitt Romney and Papa John are Multi-Millionairs…they REALLY should be ASHAME of themselve for using this SCARE TACTIC. We all are wise enought to know, this is NOT about Obamacare but Mr. Romney and other Millionairs like them PAYING THEIR FAIR SHARE IN PERSONAL TAXES.

    • eric

      That says it all Nina

    • John Gamble

      Seems what those millionaires pay already is enough for the 50% that pay zero taxes. How about you all getting and education and a job that provides you with what you need in life and quit mooching off the rest of us?

  • http://yahoo kim

    Thank you! Thank you! Clearly, if you have eyes, this is clear! These millionairs are just trying and will probably suceed at lining there pockets. This owner like most successful business people are thinking of ways to continue to get richer, he has been thinking of a way to justify and increase anyway, now he has one!!!

    • IllinoisCPA

      How does anyone get rich collecting 14 cents to give the government 14 cents?

  • jomosdaughter

    I call Bull**hit. The prices went up and the sizes went down long before “obamacare” came along. Now you buy a large it the size of what a medium used to be, you buy a medium its the size of what small used to be. I say greed cause the prices to go up, just as it did in the past.

    • Kat

      if you go into the supermarket, either the prices have gone up, or the packaging is reduced, on nearly everything, and yes, this happened before Obamacare was passed.

      • Pat

        That’s because of the out of control spending by gov’t and the cost of fuel going up because some socalled leader stopped the oil companies from getting and making fuel here so energy prices rised.

    • JR

      You got that right. All of this shrinkage and price gouging began long before Obama.

  • Danielle Parsons

    Who the hell can pay for their own on his miserly hourly wages????
    Lousy, greedy millonaire son-of-a-bitch!!!

    • IllinoisCPA

      He worked hard to get where he is. Perhaps if you worked harder and complained less you could get a better job too.

      • Ursa Worlds

        I am sure his employees work hard too.

        • CHARLEY LE CHEIN

          URSA.. The majority of workers that work at Papa Johns work for the franchise, not the corporation. Read the article agin, it mentions a lady that owns franchises.
          So, its the franchiser owners that will not be hiring more than 50 workers.

  • James Barnes

    So, I guess i’ll never have to eat his Pizza. What a jerk, you dont want health care for the workers in your ‘hot ovens’.

    • IllinoisCPA

      Anything you eat will have this cost built in, so feel free to stop eating. You can live on your hate.

      • Ursa Worlds

        Hate..Papa big bucks is hatin on his own employees.

  • IllinoisCPA

    Let us try to explain this in a rational discussion. My illustration contains numbers I have estimated that may not be exact.

    Assume one millions pizzas are sold on an average day – one for every 330 people in the US. If the price increase is 10 cents – less than the projected amount – that is $100,000 per day that people are paying because of ObamaCare.

    Some businesses will hire fewer people to stay under the 50 employee temporary threashold. That will create thousands more unemployed.

    Some businesses will simply close. More unemployed, plus the investors in those businesses now have nothing to show for years or decades of hard work.

    BTW: this cost increase will also afflict all the pizza suppliers.
    Fewer customers will force them to lay off or cut hours for their employees. If they can stay in business.

    So the price of a pizza goes up another few cents while the ability of people to afford one goes down.

    And to those economic illiterates who accuse business owners, most of whom are NOT millionairs of gouging, wake up. They are only passing on a governemnt imposed cost. None of that money stays in their bank accounts.

    • buttercup

      Oh, you dear sweet disingenuous little thing.

      • IllinoisCPA

        Thank You.

  • Ursa Worlds

    I am happy to see that businesses are finally putting their political views out there. I know where NOT to spend my money.

    • pAT

      I am happy to see that businesses are finally putting their political views out there. Now I know to support a company like papa john’s that has a good political view on trying to straighten out this country and get it back on track. Pizza by Papa Johns tomorrow night.

      • samdash

        There is nothing criminal about offering health care to its employees. I think it’s only human to do so. We can always pitch in the extra dough.

    • Andrew

      So Ursa, do you NOT buy gasoline because of all the horrible things that oil-producing nations do to suppress women? Didn’t think so. Your comment made me laugh though. thank you!

  • http://www.mittandpapaarebuttbuddies.com tommy

    I care less about this douchebag and papa johns pizza than the kardashians at least one of the kardashians has a nice ass papa dbag and the mitts have nothing to offer anyone

  • Velma

    I would happily pay another even thirty cents per pizza knowing that the person serving me the pizza has health insurance. It also would mean that because the server has preventative care, I am less likely to be exposed to anything contagious.

  • paul

    this is just more crap from guys who never lose a penny.if cheese prices go up eventually it is reflected in the price.yes healthcare costs will increase the cost.suck it up buttercup dont be a dickhead.your total cost is going down when all these people go to the doctor instead of the ER.prevention works.

    • Jemtec

      Well said dude!
      :-)

    • Lisa

      BINGO

  • harold

    My heart rejoices!! For the most part I see people in these comments understanding that the people who serve their food, clean their house, wash their clothes,etc. deserve health care and it’s really “No big strain”. Maybe next we’ll work on a TRUE living wage. Money isn’t everything…share it!

    • John Gamble

      since money isn’t everything, give me some of yours. Tired of everyone claiming their right to something they haven’t earned. bunch of lazy, whiny, give me, no good losers.

      • r b

        i am tired of folks who continue to claim that some one has not earned the right to be paid a decent wage for their labor that affords them housing, food and medical care.

        who determined you have earned the compensation package you receive. they are obviously over paying you.

        • John Gamble

          My wage is determined by my level of education…. 2yr degree… my 9yrs military service… and that I work a high risk job, in a powerplant. When you’re willing to work around high energy/high voltage equipment all day for a living, you too will have EARNED what you make. Seems to be a lot of class envy on here. Didn’t pay attention in high school, now you want us who did to take care of you. typical.

  • http://yahoo.com ToughPower

    So he rather say I want some young kid to deliver my pizzas and God forbid if he is injured in a wreck his hospital bill swill bankrupt him for the rest of his life. I will never by this crap again anyway it’s a terrible product. And if you want to know how greedy this guy is look up what he did to franchisees about 10 -12 years ago.

    • Chris

      This a political move/tactic that Papa Johns is participating in with the Romney camp. The Pizza is terrible, Processed/fake sausage, sause is watered down and lack flavor, the dough taste ok, but in all the pizza’s are terrible. Papa John’s is on the same level as Little Ceasar’s. To loose Papa John’s would be a great thing! Let’s boycott!!!

  • drew payne

    you got to be kidding me. 14cents more a pizza verses giving your employees coverage. i had been a long time fan of your pizzas. i’ll be looking to give my kids some other food thats bad for them now.

    • jim

      You might want to do a double check on the bad for you part. Papa John’s has less crap in the ingredients than any other national chain i have seen. I have been around the pizza industry since i was 15 years old. Check the actual ingredients of all the toppings, dough, and sauces. Most of the places will blow your mind. A few pizza places cheese have the nutritional value of cardboard. So if you want to have your kids eat that kinds of food because you don’t agree with a CEO’s thoughts? You better stop shopping at any place on the planet, you wont agree with any CEO. They are rich and don’t really care about you. They want the money. Think on that for a day or 2 before you send some stupid reply. Also go check the ingredients in all of the food at the other pizza places and tell me you will feed your kids that crap because you don’t like a small price increase and what a CEO thinks. Parenting 101= YOU FAIL In fact you get a 0. Congrats!

  • Truth

    An extra 14 cents. Give me a break. I bet she has medical insurance. These people have gotten rich while their staff struggles to survive. Losing Pappa Johns would be no big lost since they are a part of the health care problem with their artery clogging food.

    • samantha

      I use to like Papa John’s but I haven’t bought a pizza from them in a while. Now this gives me a reason. I have worked in the hospital and have seen people who are not ready to leave be kicked out! My friend had a great job…then breast cancer struck…she is single and does not know what her future will be. She can afford healthcare…the cost are litereally killing her. There are so many people like that. I applaude President Obama for trying to do something about that! He has my vote!!!

      • samantha

        I meant to say,” She cannot afford healthcare…”

    • MM

      Until it’s all of your foods at the grocery store being passed down from the manufacturers to the middle men to the grocery market itself. Until it’s all the clothes you buy, all the movies you watch, basically anything and everything available on the market to purchase. Then watch that 14 cents add up.

  • http://yahoo tammy

    Once again the greedy one’s with money passing the buck off to the little guys. It happens with everything else, why not pizza?

  • D.K. Adams

    Fast track to bankruptcy. Join the Obama parade

  • Andy Allen

    Everyone is going to end up paying more…20 years ago my employees couldn’t pay their home phone bill…now they ALL have iPhones…how is that? 80 % of Americans live within 2 paychecks of being ‘flat broke’, WE spend money on things that we don’t need while trying to be cool or live above our means. I’m a business owner with over 300 employees, we offer insurance now and only 10 employees take it!!! The rest want a .50 cent an hour raise…to help pay for their iPhone!!

    • Lisa

      Thank you. I am going to start to college and when I don’t make a passing grade I want the person that has an A to give me some of it. Why stop at all this free stuff everyone thinks they are entitled to that we working class tax paying people pay for.

  • http://Yahoo urret

    I ‘m glad he came out with his distaste for not wanting his employees to have decent healthcare. I’ll never buy another PapaJohns pizza again and he is going to wish he hadn’t opened his mouth about this when his wallet gets lighter.

    • Andy A.

      “I have never understood why it’s “greed” to want to keep the money you’ve earned, but not greed to want to take somebody else’s money”. ~ Thomas Sowell…there you go, our country has turned into an entitlement state…little Johnny comes home with a 6th Place Trophy 2 feet high, Look Mom – I won! Uhhh, no you didn’t…

  • Cynthia

    To be honest, I don’t like Papa Johns…. I hope they go under. In the Arkansas store they fired all their old employees with made up stories just because they wanted to hire in more people to make less and drive their own vehicles and Papa Johns can’t supply vehicles or gas? They even took away the $1.00 a pizza delived to a place…. Say if one person ordered 10 pizzas, that driver would get $10.00….. Now they would only get $1…. I’m actually glad they lied on my husband and got him out of there… I don’t recommend anyone working there. I hope they are the first ones to go under! Yea I know that sounds bad, but we have kids and they pulled some childish stuff on us and the rest of the employees at the store… All because of greed!

  • r b

    the gop neo socialist economic plan, authored by reagan, is the cause of the current economics. as the owners who follow this plan have discovered, low wages have lead to fewer customers with enough disposable income to purchase their products, which has forced higher prices to sustain past profit margins. at some point in this economic plan, the only customers left will be the owners and share holders. the vast majority of the labor pool will have been reduced to peonage.

    the gop, (reagan), philosophy: as long as what i do will not adversely or detrimentally affect me during my life time i will vigorously deny any of the effects that my actions will cause.

  • Gary

    Papa John tells the truth. I like that, so now I will start buying his pizza and also Chic-fil-a. 2 businesses Obama didn’t build they built it themselves.

    • mike

      No government help at all?I doubt it.

    • Kyle

      You dumb son of a bitch. You do realize that clip was edited to make it seem like he said that. Go look up the original speech.

      And to Amanda Crum: http://ir.papajohns.com/releasedetail.cfm?releaseid=637328

      “January 5, 2012

      After another strong year of growth, including opening its 3,000th restaurant in North America, Papa John’s is again offering franchisees an enticing package of incentives to grow within or join the Papa John’s family.”

      How dare you call yourself a journalist while only telling half-truths.

  • Anna

    This is so typical of big business. He does not want to lose his profitt margin that he built off the backs of people he made next to zip to work for him and then used the roads and bridges, utilites and other resources that are paid for in the taxes HIS employees pay (the company as a whole paid less then 8% taxes per gain last year) I have known people who have worked there for YEARS, no raise no benefits no reimbursement to deliver the pizza work 50 hours a week and make less then 20,000 a year so why not moan and groan that he now needs to take care of the people that help put his money in the bank.

  • C. B.

    This is shame. The CEO of Papa John’s blames his failures on President Obama. Every since he became CEO he is being lowering the prices of their pizza to compete with Pizza Hut. Now that he sees that his plans have failed, he is blaming the health care bill. It is not Obama Care although I am glad President Obama cares about all the people not just the top 2 percent, the fitly rich! There is only about five dollars in a large supreme pizza. Yes pizza is mark up over four hundred percent. I am talking about fast food pizza places. So now it is the president fault that you want to raise the price of your pizza. What is wrong with you assisting your employees in buying health insurance? You make sure your deliver personnel buy insurance for their vehicle. But you do not care if they get sick and need to pay a medical bill. I bet you,your family and close friends have the best HEALTH CARE money can buy. So, raise your price of pizza, but do not think your customer believe the lie that it is because of the HEALTH CARE BILL.

    • mike

      You hit that one out of the park.

  • samdash

    It’s news that eateries and fast food joints offer health insurance to their employees. McD, KFC, Taco Bell, Chic Fil A, Wendys etc, would be long gone if they are to offer HC to it’s employees.

  • Wayne

    Papa Johns pizza sucks so who cares

  • Ray

    Without a doubt this is truly a unique marketing campaign… and why not do it. Look how much business Chic Fil A pick up for hating gays. It will be interesting to see if it works.

    • john

      Showing how much of an idiot you are by saying Chick Fil A hates gays. Dan Cathy has a right to his beliefs and he does not discriminate. Any one is welcome to go there that wants too. I guess you think Romney is a murderer too?

  • don

    if you are supporting romney i will make sure every one in modesto knows about it we will shut you down

  • Mike Hearn

    It amazes me that so much of the people against this healthcare is the ones that more than likely don’t have to worry about having health care because they can afford to have it. I would be willing to bet that over 70% of Papa John’s customers cant afford health care coverage but there in ther lining his profits, and this magot moron has to snivel about a 15 cent raise on a pizza. Guess where I am no longer buying Pizza. I agree with the other commenter if the press had stayed out of this this crap wouldn’t be happening

    • M Schmidt

      People don’t realize, it’s not just about Papa John’s. It’s going to be every company in the U.S. that has a desire to make enough profit to meet their bottom line. I don’t know of anyone who decides to go into business that doesn’t expect to make some type of profit, nor anyone who invests into a company by purchasing stock that doesn’t expect to get a return on their investment. And these same job creaters are no more greedier than the blue collar worker who expects to get a raise from time to time. The fact is any product purchased in the U.S. whether it be food or a car is going to have higher costs added as a result of ObamaCare. It’s just that most companies are not going to be as honest about it as Papa John’s. Even Goodwill has to make sure they make a healthy profit in order to continue to exist!

  • Bonnie

    We’er with ya’, Papa John.

  • Bonnie

    We’re with ya’, Papa John.

  • Sedrick

    Is it a surprise that Papa John himself, aka John Schnatter, the chain’s CEO, is one of Mitt Romney’s biggest supporters? To afford to offer coverage to all the chain’s employees (which shouldn’t be such a problem, as the CEO is one of the wealthiest men in the industry and nation) would amount to 11-14 cents per pizza..and let’s be honest…the only reason Papa John’s CEO has made the loud announcement is to rip at President Obama politically. Hasn’t he learned from the Chick Fil-A situation that it isn’t wise to mix politics with your recipe?