San Francisco HCSO Health Care Expenditure Rates Increased for 2017

The San Francisco Health Care Security Ordinance (HCSO) requires covered employers to satisfy an employer spending requirement by making health care expenditures for their covered employees, among other reporting and notice requirements. For more information on what constitutes covered employers/covered employees, please visit the San Francisco HCSO website link below.

The health care expenditure rate varies depending on the size of the employer and increases incrementally each year. As of Jan. 1, 2017, the health care expenditure rate for large employers with 100 or more employees increases to $2.64 per hour payable (up from $2.53 per hour in 2016). For medium-sized employers with 20 to 99 employees, the expenditure rate will rise to $1.76 per hour payable (up from $1.68 per hour payable in 2016).

In addition, beginning Jan. 1, 2017, the city of San Francisco now requires that 100 percent of the required amount of health care expenditures for each covered employee be made as irrevocable expenditures. An irrevocable health care expenditure is a health care expenditure that has not been retained by and cannot at any time be recovered by or returned to the employer. Importantly, an irrevocable expenditure now also includes all employer contributions to HRAs. For more information on what constitutes an irrevocable expenditure, please visit the HCSO website link below.

Finally, all covered employers are required by the HCSO to post an official notice regarding the HCSO in a conspicuous place at any workplace or job site where any covered employee works. The HCSO has released the updated 2017 Official OLSE Notice. The San Francisco Office of Labor Standards Enforcement (OLSE) is responsible for enforcing the employer requirements of the HCSO. Covered employers should ensure the revised version of the notice is displayed at applicable job sites. A copy of the new 2017 Notice can be found below.

2017 San Francisco HCSO Overview and Rates »
2017 San Francisco HCSO FAQs on Health Care Expenditures »
HCSO 2017 Official OLSE Notice »