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Health Care Security Ordinance (HCSO)

 

 HCSO News

 
  • New! Notification for employers who used excepted benefits HRAs to comply with the HCSO in 2014. If you are an employer or representative and you allocated funds to an excepted benefits HRA on behalf of Covered Employees for 2014, please see the January 29th notification. The deadline for "truing up" those accounts has been extended from January 30th to April 10, 2015, and reporting requirements have changed.
  • New! The Office of Labor Standards Enforcement released updated Administrative Guidance on the HCSO on October 24, 2014. The following sections are new or significantly updated:
  • New! The San Francisco Board of Supervisors passed an amendment to the Health Care Security Ordinance on June 17, 2014. The amendment phases in (over 3 years) a requirement that all heath care expenditures be made irrevocably and makes other changes to the HCSO. For more information, see the HCSO amendment.
  • As of January 1, 2015 the health care expenditure rate for large businesses (100 or more employees total) are $2.48 per hour, and the rate for medium-sized businesses (20-99 employees total) are $1.65 per hour.
 

 Overview

 
  • Under the Health Care Security Ordinance (HCSO), all covered employers must meet the following obligations:

1. Satisfy the Employer Spending Requirement by making required health care expenditures on behalf of all covered employees (those who have been employed for more than 90 days and who regularly work at least 8 hours per week in San Francisco) at the following rates:

 Employer Size

Number of Employees  2014 Expenditure Rate  2015 Expenditure Rate
 Large All employers w/100+ employees  $2.44 per hour payable  $2.48 per hour payable
 Medium Businesses w/20-99 employees
Nonprofits w/50-99 employees
 $1.63 per hour payable  $1.65 per hour payable
 Small

Businesses w/0-19 employees
Nonprofits w/0-49 employees

 Exempt  Exempt

2. Maintain records sufficient to establish compliance with the employer spending requirement.

3. Post an HCSO Notice in all workplaces with covered employees.

4. Submit an Annual Reporting Form to the OLSE by April 30th of each year. 

  • For details about these and other requirements, see our Frequently Asked Questions, review our other resources, or contact the OLSE at hcso@sfgov.org or (415) 554-7892.
  • Employees who believe their rights have been violated may submit an HCSO Complaint Form (PDF).
 

 Administrative Guidance

 

A. Overview
B. Covered Employers
C. Covered Employees
D. Calculating Required Health Care Expenditures
E. Making Required Health Care Expenditures
F. Revocable & Irrevocable Health Care Expenditures
G. Contributing to the City Option
H. Employer Notice-Posting Requirement

I. Employer Recordkeeping Requirements
J. Employer Reporting Requirements
K. Health Surcharges
L. Retaliation Prohibited
M. Filing a Complaint
N. Penalties
O. HCSO and the Affordable Care Act
P. Expenditures and Enforcement Guidance for 2014

   
 

Download all Administrative Guidance (PDF)

 

 

 Email Updates

 
  • Sign up for email updates! Join the OLSE email list for employers with 20 or more total employees (including those outside of San Francisco) to receive periodic updates about applicable San Francisco labor laws.
 

 General HCSO Resources

 
 

 Annual Reporting

 
 

 San Francisco City Option (Healthy San Francisco and Medical Reimbursement Accounts)

 
  • One way that employers may comply with the HCSO’s spending requirement is by making contributions to the City Option on behalf of their covered employees. Depending upon eligibility, employees who receive these contributions will receive:
    • free or discounted enrollment in the Healthy San Francisco program, or
    • a Medical Reimbursement Account to pay for out-of-pocket medical expenses.
  • Upon contributing to the City Option, employers must provide their employees with a one-time Employee Health Care Payment Confirmation (PDF) (English) (Chinese) (Spanish).
  • To learn more about contributing to the City Option, visit www.sfcityoption.org or contact City Option Program Management at employerservices@sfcityoption.org or (415) 615-4492. 
 

 Health Care Surcharges

 
  • Businesses are neither required to, nor prohibited from, imposing surcharges on their customers to offset the cost of complying with the Health Care Security Ordinance. However, employers that elect to impose such surcharges must comply with specific requirements.
  • On May 1, 2009, the State Board of Equalization issued a Special Notice (PDF) regarding the taxability of such surcharges. To reach the State Board of Equalization, please call 800.400.7115.
 

 Upcoming Administrative Hearings and Hearing Officer Decisions

 
 

 Contact Us

 
  • Please email hcso@sfgov.org or call 554-7892 with any questions regarding your rights and responsibilities under the San Francisco Health Care Security Ordinance.
Last updated: 2/20/2015 4:53:24 PM