Employers in every state should be watching the progress of a new ordinance in San Francisco that mandates employer health spending and funds a government (city) health care program for the uninsured.
That means employers must pay for health insurance whether or not they want to (or whether or not they can afford it).
The ordinance requires employers to pay a specific amount of money — depending on company size and nonprofit/for-profit status — per hour for every employee for health care. It’s up to the company whether or not that goes into an employer-sponsored health insurance plan, a health savings account or to the city.
More specifically, it says:
- A private employer with between 20 and 99 employees and a nonprofit with 50 or more employees would, for any employee who has been employed for 90 days and works more than 10 hours per week, make health care expenditures of $1.17 per hour on behalf of that employee.
- A private employer with 100 or more employees would make health care expenditures of $1.76 per hour on behalf of each covered employee.
The Golden Gate Restaurant Association sued and the ordinance is being appealed, but a judge earlier this year said the ordinance was legal in the interim.
Employers, I imagine, are up in arms about this for a number of reasons. What kind of repercussions could an ordinance like this have in a city such as Wichita? Would it drive away corporations and hinder growth?
If you want to read the judge’s opinion on this, here’s the order: