San Francisco Restaurants Rally Against New City Health Plan

November 9, 2006 (PLANSPONSOR.com) - A restaurant association in San Francisco has sued the city in federal court this week to try and stop the progression of a health plan scheduled to take effect in July that would provide insurance to uninsured residents.

The Health Access Program will rely in part on mandatory annual payments from San Francisco businesses that will amount to an estimated $30 million. However, the 800-member Golden Gate Restaurant Association claims that the Employee Retirement Income Security Act (ERISA) bars such interference by local governments in employee benefits, according to the San Francisco Business Times.

Under the program, San Francisco businesses with at least 20 employees are expected to contribute between 15% to 20% of the approximately $229 million needed to fund the program annually. Companies would be charged either $1.06 or $1.60 per hour per employee, depending on business size.

Other sources of funding for the program include the city of San Francisco, the people covered by the plan and federal sources.

According to the news report, the restaurant association’s claim will hinge on a similar argument used by Wal-Mart Stores Inc., to fend off a Maryland law that threatened to make it pay a minimum amount for health care (See Wal-Mart, Other Retailers Challenge MD Health Care Law ).

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