After a dozen years in the New Orleans restaurant business, Stephanie Bernard has moved up the ladder, from dessert prep cook to pastry chef to purchasing manager. She also gave birth to a daughter, Agnes, and today has a second child on the way.

Health insurance provided by her employer, the local restaurant group Dickie Brennan & Co., has been a constant through those chapters of her career and her life.

“It’s made all the difference,” said Bernard, 35. “Having insurance — there’s a sense of relief, because you don’t know what’s going to happen. There’s a lot of things that keep me with this company, but health insurance is one of them.”

Bernard, however, is something of a rarity in the local restaurant sector, a cornerstone of the city’s economy where lack of access to affordable health care is becoming a more urgent concern.

The long-simmering issue came to the forefront in May when a group of hospitality workers staged a protest at a meeting of the New Orleans Tourism Marketing Corp. They demanded a free health care clinic, to be funded with proceeds from the city’s hotel occupancy tax.

That tax generates tens of millions of dollars annually, among other things helping the Ernest N. Morial Convention Center amass a surplus of more than $210 million.

At a news conference days after the protest, hospitality leaders and city officials said they were on board with the effort.

But three months later, what they might do remains a mystery. Officials say they’re still trying to wrap their minds around the issue.

“We’ve got a great industry,” said Mark Romig, president and CEO of the Tourism Marketing Corp. “It’s pouring a lot of money into the city, and we need to make sure that it’s working for everybody as much as it can.”

Gaps in coverage

Rather than get into the medical field itself by opening a clinic, local health care experts say the hospitality industry might be better off steering workers into the existing network of community health care providers, which offer free or low-cost services for the uninsured.

Some have also suggested a hybrid model, perhaps similar to the nonprofit New Orleans Musicians’ Clinic, which could serve as a point of entry for hospitality workers to receive care.

Another option is working with an insurance company to offer subsidized coverage for workers that would likely be cheaper than options available on the federal marketplace under the Affordable Care Act.

One complicating factor is that many in the hospitality field make too much money to qualify for Medicaid coverage, but not enough to afford options in the private marketplace.

“There are still gaps in terms of coverage and access, so the hard thing is figuring out how to really fill those gaps,” said Susan Todd, the former executive director of 504HealthNet, an association of nonprofit and governmental organizations that operate more than 60 community health centers in the metro area. 

For the uninsured, payments at clinics in the 504HealthNet network are determined on a sliding fee scale based on a patient’s income. To qualify for Medicaid, a single person can earn no more than roughly $16,500 annually. Many of the city’s roughly 30,000 hotel and restaurant workers earn average wages above that threshold, according to research compiled by the Data Center.

And while many could instead buy insurance through the federal marketplace, and in some cases receive subsidies to help offset the rates, that would come at a cost that is likely to be out of reach for some, experts say.

For example, the monthly premium for a "silver plan" — the most commonly purchased type in the federal marketplace — for a 30-year-old man in New Orleans who earns about $20,000 is about $80 per month. Raise the income and the rates accelerate. At a $30,000 annual salary, it'll cost about $200 per month. At $40,000 annually, it’s closer to $320 per month.

For many, simply navigating the insurance market is a challenge, experts say, especially for people doing it for the first time. Nationwide, two-thirds of restaurant and bar workers are under 34, according to federal labor data.

Insurance not the norm

Just ask Lita Farquhar, who has worked in the hospitality industry since moving to New Orleans four years ago.

After turning 26 and rolling off her family’s health plan, Farquhar recently tried to enroll in Medicaid, but her application was denied. A paperwork issue doomed her effort, she said, because a previous employer needed to confirm that she left the job months earlier.

Frustrated, Farquhar participated in the May protest at the tourism board meeting. She believes that the industry should offer free health care for its workers and their families.

“We just generate so much money for this city and are barely surviving, so I don’t think actually that’s way too much to ask for,” she said.

Some restaurant companies do provide robust benefits, as Bernard’s experience at Dickie Brennan & Co. shows.

Christine Bondio, the restaurant company’s director of people development, said it has long made affordable health benefits a priority for its staff.

“This is a very family-oriented business, it’s family-run, and it’s important to the ownership group that the team members feel like a family,” she said.

But for many, getting insurance is an aberration rather than the norm.

Dickie Brennan & Co. is a large company, with four restaurants and hundreds of employees. Most restaurants are much smaller. According to the National Restaurant Association, 90 percent of U.S. restaurants have fewer than 50 employees. With a small base of employees and a typically slim profit margin, employer-provided health care insurance has been a rare perk.

Typically, restaurants that offer health benefits determine an employee’s eligibility based on the number of hours they work. In the restaurant field — where flexible schedules and changing shifts are typical — that can radically change the insurance outlook.

Changes implemented under the Affordable Care Act require companies with 50 or more full-time workers — meaning employees averaging 30 hours a week — to offer affordable health care benefits or face stiff penalties.

Affordability is the key word. If a company’s plan is too expensive, younger workers may pass on buying coverage altogether, experts say.

While many businesses grapple with rising insurance costs, the hospitality sector has unique challenges, including high turnover, according to Will Smith, a benefits adviser at Eustis Insurance and Benefits in Metairie.

“It’s a very different demographic than a law firm or engineering firm, where you don’t have that turnover and your staff are salaried, not hourly or based on tips,” said Smith, who works with restaurants around the state.

Meanwhile, it’s unclear where the Louisiana Restaurant Association stands in the debate, which could influence how a solution comes together. Stan Harris, the association’s president and CEO, could not be reached for comment. Neither could Mavis Early, executive director of the Greater New Orleans Hotel & Lodging Association.

Musicians' Clinic model

But some involved in the nascent effort point to the Musicians’ Clinic, which focuses on preventive care and mental health services for more than 2,500 locals who contribute to the city’s cultural landscape.

It’s a relatively small operation, embedded within the LSU Healthcare Network. It relies on donations to cover health care for uninsured patients and works to steer those who are eligible into Medicaid.

The concept of establishing a clinic for hospitality workers has come up periodically for more than a decade, according to Bethany Bultman, president and director of the Musicians’ Clinic, which was founded in 1998. But previous efforts have stalled.

The nonprofit operates on a $3 million budget and relies on a stable of low-cost medical volunteers, as well as relationships with local providers, including LSU Health New Orleans, the LSU Healthcare Network and University Medical Center New Orleans. Almost three-quarters of the patients the clinic sees are enrolled in Medicaid, Bultman said.

“If we had to pay for what we do in terms of our health care, it would be unaffordable,” Bultman said. “If they start a restaurant or service worker clinic, they really and truly need to do it through the community health care system and be able to get the funding to expand an existing facility.”

Some in the industry say the key starting point is evaluating what types of services people need and understanding the logistical challenges with getting care.

“We’re trying to bite off something that’s really not something a sales and marketing organization is supposed to be doing,” said Stephen Perry, president and CEO of New Orleans & Co., the city's recently renamed convention and visitors bureau. “We’re doing it because we care about people and the employee part of the equation matters.”

In an interview, Perry suggested rolling out a subsidized plan that would contain monthly premiums at around $60 “without having to reinvent the wheel and try to become a competitor in the health care marketplace.”

But any action, at least initially, will likely focus on raising awareness of what’s already available.

“What will it cost if we don’t provide this service?” said City Council President Jason Williams, who spoke at the news conference days after the protest. “Because if we don’t have a healthy workforce, then you’ve got an even bigger problem.”

Fear of unions?

But as officials look for ways to implement a plan, some workers worry that the real goal may be to stem any effort that would encourage workers to unionize.

Last year, hundreds of workers at the Hilton New Orleans Riverside, the city's largest hotel, voted to unionize. It was a rare development locally, and one that labor leaders think could give them a long-sought foothold in the city's hospitality industry.

Some big U.S. tourism cities, including Las Vegas and New York, have long had strong union presences, which supporters say have helped maintain solid wages and benefits and allowed more hospitality workers to live middle-class lives.

On the other hand, union opponents warn that organizing would likely lead to price hikes at the city’s hotels and restaurants, which could cause visitor levels to fall.

In Las Vegas, however, labor officials can point to tangible results on health care. The city is home to a $30 million health center, opened in 2017 and paid for by the Culinary Workers Union and employer contributions. A majority of its services are provided with no co-pay required from participants.

The average culinary worker on the Vegas Strip makes $23 an hour, according to Bethany Khan, a spokeswoman for the Culinary Workers Union.

Whatever form it takes, local officials and other observers agree that improving access to affordable health care is a practical way to support the workers who contribute to the city’s lifeblood.

“We have to change the way that we value the goose that’s laying the golden egg,” said Bultman, of the Musicians’ Clinic. “There’s just something off about who’s getting the benefits, because the people who are waiting on your table, performing for you, cooking your food, fishing for your food and growing your food are not part of the system of capitalism that’s getting the rewards.”

Follow Richard Thompson on Twitter, @rthompsonMSY.