Health Care Mandate Challenged

 

A San Francisco ordinance dictating the amount businesses must spend on employee health care violates federal law, according to a friend-of-the court brief filed March 28 by the U.S. Chamber's National Chamber Litigation Center (NCLC).

 

"This is another example of how a patchwork of draconian health care regulatory regimes only serves to hurt businesses and muddle the national health care debate," says Robin Conrad, executive vice president of NCLC. "State and local laws like San Francisco's Health Care Security Ordinance conflict with federal health care policy and interfere with employer autonomy over whether and how to provide employee health coverage."

 

San Francisco's ordinance requires companies with more than 20 employees who each work a minimum of 10 hours a week to spend at least $200 per employee per month on health care benefits or divert that money directly into the state's health care fund. Employers with more than 100 employees  each working a minimum of 10 hours a week must spend at least $300 per employee per month.

 

In the brief, NCLC called on the Ninth Circuit Court of Appeals to strike down the ordinance because it preempts employers' rights under the federal Employee Retirement Income Security Act (ERISA). This act allows employers to establish and administer a health care
plan on a uniform, companywide basis.

 

This is the second time that NCLC has joined the Retail Leaders Industry Association to challenge a local or state law mandating the terms of health care coverage.

 

Last year, the two organizations successfully defeated a similar Maryland law. Union officials and other proponents of these mandates have pledged to introduce similar legislation in as many as 30 other states.

 

At least nine business groups have filed briefs in the San Francisco lawsuit. Visit www.uschamber.com/nclc/caselist.