Wait, what’s that extra fee? You may see a COVID surcharge on your next bill.

It’s a way to recoup the sudden costs of masks, gloves and sanitizing sprays by passing them to the consumer.
Original Pancake House receipt from Kendall restaurant.
Original Pancake House receipt from Kendall restaurant. [ Miami Herald ]
Published May 22, 2020

As businesses reopen from their pandemic shutdown, some are adding a new charge to help recoup costs of the coronavirus.

Dentists and restaurants have started to add COVID-19 fees to the bill. It’s a way to recoup the sudden costs of masks, gloves and sanitizing sprays by passing them to the consumer.

And customers are noticing.

In Missouri, a customer’s receipt from Kiko Japanese Steakhouse showing a $2.19 surcharge made the social media rounds. Kiko apologized on Facebook, saying the surcharge was now gone but would soon be replaced by higher menu prices “due to increase prices from our supplier on meat, poultry, seafood and produce.”

In Florida, in Jacksonville, a mother noticed a charge at her child’s dentist office, Action News Jax first reported. Pediatric Smiles confirmed the new $10 per patient co-payment to offset costs of the additional masks and gloves, known as PPE.

In a statement, the office said the money went “to absorb the losses of our office being closed for seven weeks” and that third-party fees were officially recommended by the American Dental Association.

“With more debt and typically lower incomes, new dentists have unique challenges and outlooks during the crisis,” according to a statement by the ADA. “The ADA is urging third-party payers to alter their fees to account for the increasing cost of personal protective equipment that dentists are using to protect themselves, their staff and patients. Third-party benefit programs should either adjust the maximum allowable fees for all procedures or allow a standard fee per date of service per patient to accommodate the rising costs.”

Connecticut-based Cigna, a major provider of dental insurance, declined to comment about the trend.

In the past, some restaurants have added a fee for takeout containers. Now, diners might be seeing a COVID-19 surcharge.

At the Original Pancake House in Kendall, for instance, a regular who didn’t see anything extra on the bill last week said he noticed a $2 extra charge on two recent visits. The restaurant, part of a chain, acknowledged that all orders now have a 15 percent “service fee” going forward. Tip is extra.

A spokesman for the Original Pancake House company based in Portland, Oregon, referred the Miami Herald to the owner, who did not return a call.

Ashley Chambers, spokeswoman for the Florida Restaurant & Lodging Association, said she has not heard of eateries tacking on charges due to the pandemic. A top restaurant publicist in Miami wasn’t familiar with the practice, either.

“No one has talked about a COVID fee as far as passing anything along to the consumer,” said Larry Carrino who has dozens of clients in South Florida and helps run the South Beach Wine & Food Festival. “I would be frankly surprised if anyone would be doing that.”

If not a separate fee that’s noted on the check, diners may see price increases on the menu due to a loss in revenue from the shutdown and a disruption in the food supply chain, he said.

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That’s already being reflected in California, where NBC San Diego reported that local taco shops have increased menu prices to offset shortages The meat industry has been badly hit due to processing facilities closing down, leading to higher prices.

Simply put: The cost of doing business has gone up in the coronavirus era.

“I would expect to see this going forward, due to the expenses for sanitizing, PPE and supply chain costs,” said Adam Itzkowitz, a managing partner at Itzkowitz Law. “This is legal, even if it’s upsetting for some customers.”

The Florida lawyer told WTSP in Tampa that those charging extra be as “transparent as possible,” and not sneak in the fees just before swiping a customer’s credit card. Restaurants, he said, should put out signage or post an alert on their websites — just like some restaurants did in charging extra for guacamole during an avocado shortage.

Cinthya Lavin, a Better Business Bureau spokeswoman for Southeast Florida and the Caribbean, said the surcharges are ethical, as long as businesses are transparent about stating what they are for.

“Although there is no specific amount as to what these charges should be, again the ethical thing is to not take advantage by charging a gross amount over the services rendered,” Lavin said.

She added that “time and regulation” will decide how long these fees will be common practice. The BBB has not yet received local complaints about COVID surcharges, she said.

Gabriel Falken, who manages Fort Lauderdale Beach’s social media, said he supports local restaurants and often gives them free advertisements on the Facebook page. But he said he won’t support restaurants with a COVID-19 surcharge.

Falken warns about possible consumer backlash. He said he would rather restaurants increase menu prices to reflect the market. But he said owners are worried their competition will undercut them.

“There’s a point when they need to realize that we’re all in this together,” he said.

The BBB says restarting business is a challenge for everyone.

“While the economic impact of COVID-19 is undeniable, businesses are learning how to adapt to a new normal,” says a Better Business Bureau report on how small businesses can resume operations. “Trust has never been more important.”


MAY 22, 2020 06:00 AM

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