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Compliance Briefing Center

Legislation and Reform

Making it Easier for You
to Manage Benefits

2020 San Francisco Health Care Security Ordinance Rates

 

August 26, 2019
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The San Francisco Healthcare Security Ordinance (HCSO) provides individuals, who work in San Francisco and qualify as an employee entitled to minimum wage, with access to affordable healthcare through a Health Access Program. The HCSO requires Covered Employers to spend a minimum amount of money each quarter on behalf of their Covered Employees’ healthcare; i.e., those who have been employed for more than 90 days and who regularly work at least 8 hours per week in San Francisco. The 2020 health care expenditure rates have recently been released, and the rate history is as follows:

Employer Size* Rate Per Hour
2014 2015 2016 2017 2018 2019 2020
Large Employers
(100+ Employees)
$2.44 $2.48 $2.53 $2.64 $2.83 $2.93 $3.08
Medium Employers
(20-99 Employees)
$1.63 $1.65 $1.68 $1.76 $1.89 $1.95 $2.05

*Non-profits with fewer than 50 employees are exempt from the Employer Spending Requirement.

A Reminder Concerning Irrevocable Expenditures
On June 17, 2014, the San Francisco Board of Supervisors amended the Health Care Security Ordinance to phase in, over a three-year period, a requirement that all health care expenditures made by Covered Employers on behalf of their Covered Employees, be made "irrevocably." Employers previously had the option to make health care expenditures on behalf of their Covered Employees either with irrevocable expenditures, such as insurance premium payments, or with revocable expenditures, such as allocations to Health Reimbursement Arrangements (HRAs), where unspent funds can be returned to the employer.

The three-year “phase-in” required that 60% of the employer expenditure in 2015 be irrevocable; 80% be irrevocable in 2016; and all employer health care expenditures be irrevocable on and after January 1, 2017. The amended Ordinance also permits employees to voluntarily waive the unused balance of revocable expenditures made on their behalf for hours worked prior to January 1, 2014.

The Ordinance explains the benefits available for employees of employers that contribute to the SF City Option program. Based on their eligibility, employees will be offered one of three health benefits through the employer SF City Option program:

  • SF Covered Medical Reimbursement Account
  • Healthy San Francisco
  • SF Medical Reimbursement Accounts

The Administrative Guidance for the HCSO is available with sections concerning “Revocable and Irrevocable Health Care Expenditures,” “Calculating Required Health Care Expenditures,” and “Contributing to the SF City Option.”

For details about these and other requirements, Frequently Asked Questions, or other resources, please visit the San Francisco government website at www.sfgov.org/olse/hcso.