To all interested parties:

This morning the Budget & Finance Committee of the BOS held a special hearing on Supervisor Ammiano's proposed Healthcare mandate. Several members of the business community small, medium and large were represented, and below are some thoughts that were conveyed to the Commission via the SF Chamber with regard to analysis compiled by the new Office of Economic Analysis on the Healthcare Ordinance.


The Controller’s Office of Economic Analysis report on the impacts of the Ammiano Health Mandate Ordinance was sorely lacking in research on cost to businesses.

Download PDF File Here

The Controller merely estimated the cost to those businesses now not offering insurance, based on a state survey. It did not take into consideration the financial impacts on those businesses offering insurance, but not incurring costs for all employees. Exclusion of part-time employees, coverage from another employer, spouse or partner, employee opt-out, etc. all reduces benefit expenditures. None of thus was considered when the Controller estimated new costs from the mandate at only $30-49 million a year.

We will have another chance to make our case next week when the ordinance is again heard at the Budget & Finance Committee next Wednesday, July 5 th at 1PM . But we need real examples of cost of impacts.

Formula:
20-99 employees $1.06 per hour, or $1.59 for businesses with more than 99 employees times all annually paid hours (after 90 days of employment), except for management, professional and supervisory employees earning more than $72,450 a year and except employees on Medicare or military insurance. This is your annual health expenditure mandate. You may not deduct from
this pool of funds health benefit expenditures for any employee in excess of $3,282.

Example:
60 employees times 2000 hours X $1.06 = $127,200 healthcare mandate. Current health insurance expense is $3,600 a year for 30 employees = $108,000.Mandate increases cost by $19,200.

Using health insurance cost for 2005, does this formula increase the amount your business must spend on heath care benefits? We will keep employer data confidential, but really need concrete examples.

If you have any questions, please contact Jim Lazarus at 415-352-8810 or email at [email protected].