SF restaurant group loses health plan appeal
By: Brent Begin
Examiner Staff Writer
March 10, 2009
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| An appeal of the Healthy San Francisco plan, which requires employers at many smaller businesses to pay for employee health insurance, was rejected by the 9th U.S. Circuit Court of Appeals on Monday. (Examiner file photo) |
SAN FRANCISCO — A San Francisco law requiring businesses to provide health care benefits to employees or pay into a fund to provide for their care survived another legal challenge but opponents to the landmark ordinance said they are ready to take their appeal to the U.S. Supreme Court.
On Monday, the 9th U.S. Circuit Court of Appeals rejected an appeal from San Francisco’s restaurant association, which contends the employer spending mandate conflicts with federal law.
Mayor Gavin Newsom called the decision a “significant” victory for San Francisco’s affordable health care program for the uninsured, called Healthy San Francisco.
The Health Care Security Ordinance requires that businesses invest between $1.17 to $1.76 per employee hour worked, depending on the size of the company, on health care benefits or contribute funding to The City or a health savings account to provide for employees’ health needs. Other funding for the $200 million program comes from city, state and local governments as well as a sliding fee contributed by some patients depending on their income level.
More than 35,000 residents are currently enrolled in the program, according to the Mayor’s Office.
In September 2008, a three-judge panel with the federal appeals court rejected the argument made by the Golden Gate Restaurant Association that San Francisco’s ordinance unlawfully imposed on a law from Congress in 1974 that doesn’t allow state and local governments to impose employee benefits.
The restaurant association responded by asking the appeals court to have the ruling reviewed by an expanded 11-judge panel. The court denied that request Monday.
The only court left is the U.S. Supreme Court. Kevin Westlye, executive director of the restaurant association, said the issue of affordable health care has become such a national debate that the Supreme Court is likely to take on the issue.
The Health Care Security Ordinance, which was authored by then-Supervisor Tom Ammiano and championed by Newsom, took effect in 2007. In response, some city restaurants began charging customers a surcharge, in some cases between 2 and 4 percent, to help offset the costs of the mandate.
With the economy sinking, Westlye said the extra tax has put several high-profile restaurants out of business, including Mecca and Rubicon earlier this year, and Bong Su, which served its last meal Saturday.
“I think that the employer mandate is one of the significant costs of doing business here,” Westlye said.
As part of his stimulus plan for The City, Newsom pledged to create a program that would provide an offset for qualifying small businesses that are participating in Healthy San Francisco.
Nonetheless, the mayor, a former restaurant owner, said in a statement released Monday that he hopes the Golden Gate Restaurant Association, “will work for, not against, the City and County’s efforts to expand health care access.”
Providing care
The City’s goal is to provide coverage for uninsured residents.
35,000 Uninsured San Franciscans enrolled in program
$52,000 Income a single person can make and still be eligible for Healthy S.F.
29 Public, nonprofit and private health centers participating in Healthy S.F.
$1.17 Cost per employee per hour for businesses with 20 to 99 workers
$1.76 Cost per employee per hour for businesses with 100 or more workers.
Source: Mayor’s Office, Healthy San Francisco
