San Francisco Health Care Security Ordinance 2021 Indexing and Poster
The City and County of San Francisco passed a law in 2006 that established the HCSO. Since 2008, most employers with even one employee in San Francisco have had an annual reporting obligation to prove they spend a minimum amount of money on health care for employees.
There is an updated 2021 poster for employers to visibly post at each San Francisco worksite.
Employers satisfy the HCSO Employer Spending Requirement (ESR) by calculating and making required health care expenditures on behalf of all HCSO Covered Employees (generally those employed 91+ days who regularly work 8+ hours per week in San Francisco). Some employees are exempted from the ESR, including managerial, supervisory, and confidential employees earning over $104,761 (or $50.37/hr) in 2020, as well as those the employer can document being eligible for Medicare or TRICARE. The 2021 ESR has indexed as shown in the table below.
For employees in San Francisco working enough hours to be enrolled in the health plan offered to all full-time employees, then the employer can use the formula here to come up with an hourly equivalent spent across all employees enrolled in that plan (rather than a calculation specific to that employee). Employer contributions toward dental, vision, and HRA plans count, along with employer contributions to an HSA. Self-funded plan calculations must be based on actual expenditures rather than COBRA applicable premiums (see calculation instructions).
Employees waiving coverage due to enrollment with another employer would ideally sign a waiver form (also available in Spanish, Chinese, and Tagalog), but note the waiver is voluntary, so employees cannot be mandated to complete it. The waiver form cannot be completed by those with non-employer coverage such as Medicaid. For non-exempted HCSO Covered Employees unable/unwilling to complete the waiver form, or for enrolled employees for whom the employer spending is too low, the employer will likely want to contribute to the City Option and provide the requisite payment confirmation notice.
|Employer Size||Number of Employees||2020 Expenditure Rate||2021 Expenditure Rate|
|Large||All employers w/100+ employees||$3.08 per hour payable||$3.18 per hour payable|
|Medium||Businesses w/20-99 employees
Nonprofits w/50-99 employees
|$2.05 per hour payable||$2.12 per hour payable|
|Small||Businesses w/0-19 employees
Nonprofits w/0-49 employees
IMA will continue to monitor regulator guidance and offer meaningful, practical, timely information.
This material should not be considered as a substitute for legal, tax and/or actuarial advice. Contact the appropriate professional counsel for such matters. These materials are not exhaustive and are subject to possible changes in applicable laws, rules, and regulations and their interpretations.