Loophole remains in San Francisco's controversial health care law 

Amid a tense political fight, a proposal to close a loophole in San Francisco’s groundbreaking universal health care ordinance was killed Tuesday.

Under the Healthy San Francisco program, employers must spend a certain amount on health coverage per employee hour. About 860 businesses — mostly restaurants — put money in what is known as a health reimbursement account to comply with the law. But it was recently exposed that 80 percent of the money for worker health care costs returns to the employer, which amounted to $50 million last year.

Supervisor David Campos proposed legislation that would prohibit employers from taking back unused funds each year. But the proposal was blasted by the Golden Gate Restaurant Association and the Chamber of Commerce, who said it would kill jobs.

Board of Supervisors President David Chiu, who is running for mayor, was an initial backer of the legislation, but in recent weeks backed off amid opposition. Chiu said he supported the “concept” but wanted more time to work on a compromise.

Campos, however, would not stand for a postponement and instead drew a line in the political sand: close the loophole or else. Campos had support from left-leaning supervisors.

“We don’t support small businesses at the expense of our workers,” said Supervisor Jane Kim.

An analysis done by The City’s economist showed the new law could cost up to 460 jobs in a year.

“Those jobs are not worth saving,” Kim said. “We want to ensure that people can live with respect and dignity here.”

Supervisor Scott Wiener backed a continuance and said small businesses are “terrified” about the impact of Campos’ proposal.

Campos did not have the necessary six votes to approve the legislation and refused to let the board continue it. He instead tabled the bill, effectively killing his own legislation.

Chiu attacked Campos for the unusual maneuver.

“As policymakers, we don’t get to just pick up our marbles and go home,” Chiu said. “We can figure out a way to work together to protect workers in ensuring that they get health insurance as well as minimizing layoffs.”

Campos said amendments being considered to satisfy opponents would have jeopardized the entire program.

“No one wants to leave this loophole undone. But the last thing we want to do is to jeopardize universal health care in San Francisco.”

Chiu said he still planned to return with a compromise proposal.

jsabatini@sfexaminer.com

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