Court OKs Employer Funding for San Francisco Health Care Plan
On Wednesday, a ruling by a federal appeals court gave San Francisco the authority to begin enforcing a provision of a city law that requires employers to contribute toward employee health insurance benefits or help fund a new program for uninsured residents, the San Francisco Chronicle reports (Egelko, San Francisco Chronicle, 1/10).
The Healthy San Francisco program is intended to ensure access to health care services at San Francisco clinics and the city's public hospital for San Francisco's 73,000 uninsured residents (California Healthline, 1/3).
Under the law establishing Healthy San Francisco, private employers with at least 20 employees and not-for-profit groups with at least 50 employees must spend a certain amount on health care, either in coverage for their workers or in payments to the city.
The Golden Gate Restaurant Association challenged the employer contribution provision of the law, arguing that it violates the 1974 federal Employee Retirement Income Security Act. The law, called ERISA, governs regulation of employee benefits (California Healthline, 1/2).
U.S. District Judge Jeffrey White ruled against the provision, forcing the city to limit enrollment to a certain income level. As a result, about 26,000 uninsured residents remained ineligible for the program (San Francisco Chronicle, 1/10).
However, Wednesday's ruling by a three-judge appellate panel allows the city to enforce the employer provision while its appeal of White's ruling is decided in court (Sabatini, San Francisco Examiner, 1/10).
City Attorney Dennis Herrera said the judges' decision will allow the city to expand the program to all uninsured residents over the next few months. The program relies on employer contributions for 20% of its projected $200 million annual cost.
Final written arguments in the appeals case are due in April, and a ruling by the appeals court could occur in the summer or fall (San Francisco Chronicle, 1/10).
Judge William Fletcher, a member of the three-judge panel, said the appeal has "a probability, even a strong likelihood of success" (Elias, AP/Contra Costa Times, 1/10).
Daniel Scherotter, incoming president of the Golden Gate Restaurant Association, said the employer provision is "expensive, it's unsustainable and there's better ways to do it" (McKinley, New York Times, 1/10).
The restaurant association has proposed raising the city's sales tax by a quarter-cent to replace the employer contributions as a source of funding for Healthy San Francisco (San Francisco Chronicle, 1/10).
The judges' decision could boost efforts by Gov. Arnold Schwarzenegger (R) and lawmakers to adopt a plan for overhauling California's health care system, Reuters reports.
Compromise health care reform legislation backed by the governor and Democratic legislative leaders includes a provision that would require contributions from some employers (Reuters, 1/9).