San Francisco Health Care: Risk and ERISA

By January 15, 2008Health Care, Human Resources

A panel of the U.S. Court of Appeals for the Ninth Circuit has given San Francisco the go ahead to implement its universal health care plan, approving the city ordinance that forces employers to either provide health care insurance to their employees or pay into a fund for the uninsured. A copy of the court’s order is here; the case is Golden Gate Restaurant Assocation v. San Francisco.

The decision temporarily blocks a lower court’s ruling that held that the city’s Health Care Security Ordinance was pre-empted by the Employee Retirement Income Security Act, or ERISA, the landmark 1974 federal law that permits employers to maintain uniform benefits for their employees, regardless of where they live or work. Employers have many differing views on health care reform, but nearly all agree on ERISA’s fundamental value. Without it, employers are faced with burdensome and conflicting mandates and regulations from all 50 states and thousands of local governments.

The court’s ruling should provide an early indicator of what’s to come in terms of “reform” on the health care front. The worry is that other cities and states might act to quickly follow San Francisco, which is just what Congress intended to avoid by passing ERISA more than 30 years ago. We can expect further litigation, potentially all the way up to the U.S. Supreme Court.

At a time when we’re concerned with the growing number of uninsured in this country and access to quality health care, do we want to jeopardize a successful program that covers more than 100 million health care consumers? From an employer’s perspective, ERISA is the very foundation from which health care was built and while reform is necessary, maybe we should maintain the parts of care proven to work.

Various trade associations and businesses have joined forces to preserve the federal framework embodied in ERISA. Called the National Coalition on Benefits or NCB, our goal is to spread the word about the federal framework that has been successful in encouraging employers to provide the health benefits that many Americans value. The website is We view this coalition as a way for manufacturers and other employers to stick up for the ability to offer employee health-care benefits across state lines.

A thousand different San Francisco-like health care systems across the country would be impossible to manage, increase health care costs dramatically, and in the end, hurt the quality of care. Let’s prevent that unhealthy outcome by preserving ERISA.

News stories:

  • Reuters: Court says San Francisco health plan can proceed.
  • Sacramento Bee: “All Eyes on S.F.
  • Workforce Management: “San Francisco Health Care Fund Gets Reprieve
  • Jeri Gillespie is vice president of Human Resources Policy at the National Association of Manufacturers.

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