The Health Care Security Ordinance (HCSO) is a San Francisco law that was effective January 1, 2008. It requires covered employers to spend a specific dollar amount on employee health care benefits (also known as health care expenditures). Employer expenditures can include: 

• Payment of all or a portion of health care premiums, including dental and/or vision;
• Employer-funded health reimbursement accounts (HRA); or
• Payment to the City to establish HRAs for covered employees.

Beginning on Jan. 1, 2012, employers in San Francisco with 100 or more average employees (regardless of location) who work at least eight hours per week will be required to spend $2.20 per hour per covered employee on health care, up from $2.06 in 2011. Employers with 20 through 99 employees will have to spend at least $1.46 per hour, up from $1.37. Employers with fewer than 20 employees are exempt from the requirement. The number of employees is re-evaluated quarterly for purposes of determining the assessment that applies. Smaller employers may find themselves "bouncing" between assessment levels if their covered employee base fluctuates across the thresholds. While owners are counted for threshold purposes, they are excluded from minimum expenditure requirements. Employers must file reports with the City annually by April 30.

Certain employees can be excluded from coverage/eligibility under HCSO. Additionally, employees can voluntarily waive their rights under this law. Because of the complexity of these situations, employers should contact the Mayor's Office of Economic and Workforce Development (www.sfgov.org/moed) for specific details.

    

We are, as always, available to you for any questions relating to this notice, or any other employee benefit issues or concerns.