Mayor Gavin Newsom has given his approval to a controversial mandate that would require city businesses with 20 or more employees to pay for each employee’s health care, after several last-minute amendments were added.
In doing so, Newsom also locked in the final funding piece for his own ambitious plan to provide affordable comprehensive health care to San Francisco's 82,000 uninsured — including primary care, hospital services and prescription drugs.
Estimated to cost nearly $200 million, Newsom’s San Francisco Health Access Plan, as it’s been dubbed, was created on an assumption that The City would redirect $104 million already used for medical care of the uninsured to pay for the plan, and another $56 million would come from sliding scale premiums paid for by participants.
San Francisco’s employers will now be expected to fill in about $28 million of the remaining financial gap through a health care mandate proposed by Supervisor Tom Ammiano, Newsom said on Tuesday.
Under Ammiano’s ordinance, businesses with 100 or more employees would be required to pay an average $273 per month for health care for each full-time employee; businesses with 20 to 99 employees would pay $182.50 per month. A prorated amount would be required for part-time employees. Businesses that pay less than the required amount for health care per employee would be required to make up the financial difference.
The City’s business community has lobbied aggressively against Ammiano’s measure ever since it was first introduced in November as a flat monthly fee of $345 per employee for health care. The ordinance has been reworked in the time since, particularly in the last several weeks. According to Newsom, he and his staff worked “through the night” with Ammiano and others to make enoughchanges to warrant his approval.
“It’s [now] a mandate that we believe will work, that won’t be onerous,” Newsom said.
Business leaders did not agree with Newsom's assessment, saying the required health care spending will create a hardship on employers, particularly small businesses, that would result in fewer jobs, a reduction in pay raises, work outsourced from San Francisco, higher costs being passed on to customers and some business closures.
The ordinance is expected to have its final committee hearing Monday; after that it will go before the full board. Eight supervisors have indicated that they would vote for the health care mandate, which would make it veto-proof.