For years, San Francisco has led the way in workers issues by providing things like the nation's highest minimum wage and paid sick days. In 2009, San Franciscans took great pride in the passage of the Health Care Security Ordinance, which we were told would require employers with more than 20 employees to provide health insurance for their workers. We see signs at restaurants around town saying they are adding a surcharge to their bill so they can provide health insurance for their employees, and we were satisfied to know that our money was going to take care of the people who prepare and serve our food.
But now we're pissed off to learn that almost half of the restaurants are not providing actual health insurance or access to Healthy SF for the employees. Instead they are putting money into Health Reimbursement Accounts (HRAs) that is set aside for employee health costs. The bottom line is this: HRAs are not health insurance. They may be adequate to cover routine health care costs, but any kind of serious illness or injury will quickly wipe out an HRA account. HRAs are also typically too limited in what types of health care they provide.
But wait, it gets worse. If the worker quits (or is fired), or doesn't use the money by the end of the year, the employer takes it back and the account balance resets to zero. Last year, 4 out of 5 dollars were reclaimed by the businesses. This gives employers an incentive to restrict access to the account, or worse not even tell their employees they are eligible for this benefit! That means we have restaurants telling us they're charging us more to give health care to their employees, but really they're pocketing 80% of the money at the end of the year. And if their employees do get sick, we all end up footing the bill when our tax dollars are used to give them care in the emergency room!
That's why we support Supervisor David Campos's ordinance to help close this loophole. The ordinance simply says that unused money in HRAs rolls over from one year to the next.
We have heard that there's talk of a "compromise" that would split the baby by letting employers take back 50% of the money in HRAs. That compromise sucks for two reasons:
1. HRAs are not health insurance! We need to encourage employers to provide real health insurance or access to Healthy SF for their employees. Allowing them to still pocket 50% of the HRA money encourages them to continue to provide substandard care for their employees while still ripping off their patrons with their fake Healthy SF surcharges.
2. This 50-50 split would violate the ERISA (Employee Retirement Income Security Act of 1974), and could lead to the courts throwing out the entire Health Care Security Ordinance! (It's some technical stuff, but federal law says SF can't dictate how employers spend on health care. We can mandate that employers provide health care, but we can't mandate certain types of coverage.)
That's why we're urging the Board of Supervisors to close the Health Care Security Ordinance loophole without watering it down in ways that would put this landmark legislation at risk.