Federal judge voids S.F.'s mandate for insurance plan

Nation's Restaurant News,  Jan 7, 2008  

• E-mail
• Print
• Link

SAN FRANCISCO -- In a victory for the local restaurant industry, a federal judge here has struck down a law that would have required employers here to provide health insurance to employees or pay a per-worker fee to fund coverage.

The citywide "play-or-pay" man date, which was set to take effect Jan. 2, had been seen as a potential model for several state and local proposals for funding universal health insurance.

U.S. District Judge Jeffrey White ruled Dec. 26 that states and municipalities are forbidden by a 1974 federal law from regulating employee benefits. He said San Francisco was wrongly "mandating employee health benefit structures and administration."

Under the law, any business employing at least 20 people would have been obliged either to insure all staffers or pay a fee to an urban health program that was expected to cost $200 million annually. The exact fees apparently have not yet been determined.

The city still seeks to cover the estimated 82,000 adults there who lack health insurance. Mayor Gavin Newsom said he would proceed with the plan despite the loss of funding from restaurants and other employers. City Attorney Dennis Herrera reportedly intends to appeal the decision and ask the 9th U.S. Circuit Court of Appeals here to allow the employer fee to be assessed until the challenge is decided.

COPYRIGHT 2008 Reproduced with permission of the copyright holder. Further reproduction or distribution is prohibited without permission.
COPYRIGHT 2008 Gale, Cengage Learning