The City can move forward with a groundbreaking program that provides sliding-scale health services for San Francisco’s uninsured residents, as well as impose the legally contested requirement that has some businesses paying up to $1.76 per employee hour worked, a federal appeals court ruled Wednesday.
Healthy San Francisco was created through an ordinance adopted in 2006 to provide sliding-scale health care for the city’s 73,000 uninsured. The $200 million program was to be funded through state, federal and city dollars along with revenue from an employer spending requirement, slated to go into effect on Jan. 1.
But last month the employer mandate was struck down in court by U.S. District Judge Jeffrey White, after The City’s restaurant association filed a lawsuit, charging that it violated a federal law governing employee benefits.
Subsequently, City Attorney Dennis Herrera filed an emergency stay order to allow San Francisco to move forward with the spending requirement while The City appealed White’s decision.
On Wednesday, a three-judge panel of the 9th U.S. Circuit Court of Appeals granted Herrera’s request, saying it had a “strong likelihood” of winning the appeal.
The court’s decision now makes effective the spending requirement for employers with 50 or more employees. These employers will have to pay up to $1.76 per employee per hour worked on health care or to The City to satisfy the law’s requirements. Payments will be due every quarter, with first payments due on April 1.
Supervisor Tom Ammiano, who was a primary author of the ordinance, said he was “delighted” by the ruling and Mayor Gavin Newsom said the judges’ decision was “an important victory for uninsured San Franciscans.”
Healthy San Francisco has so far enrolled 8,200 residents and currently offers services to uninsured San Franciscans earning up to 300 percent of the federal poverty line, which calculates out to up to $31,000 per individual.
Golden Gate Restaurant Association member Daniel Scherotter said members are “disappointed” by the decision, but confident that once the judges’ hear all the arguments the association will ultimately win the appeal.
The lawsuit has far-reaching implications, Herrera said, adding that if the initial ruling stood “it certainly could have had an impact” on state health care reform efforts in Sacramento as well as in other states.