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Background

The HCAO Applies to Most San Francisco City Contractors and Tenants (including Those at The San Francisco International Airport and The Port of San Francisco).����

For specified workers at the San Francisco International Airport, the HCAO was amended in 2020 to include the which has different standards from what is set forth below.����

The HCAO requires employers to follow minimum standards with regards to health care. This can be satisfied by the following:��

• The employer must offer health plan benefits (set forth by the HCAO) to their covered employees – updated for plan years beginning on or after January 1, 2023��

Or��

• The employer can make payments to the Department of Public Health or, under limited circumstances, make payments directly to their covered employees.��

Which Employers Must Comply?

An Employer Is Covered by The Health Care Accountability Ordinance (HCAO) If It Meets One the Following Two Conditions

1. Employers with a contract, or seeking to contract with the City and County of San Francisco, regardless of size or location��
2. An employer leasing City property for a term of 29 consecutive days or more in any calendar year, whether established by single or cumulative agreements��

Who Is a “covered Employee”?

An Individual that Meets the Following Conditions:��

• An employee who works on a City Contract or Subcontract for 20 hours or more per week��
  • If the employee works on multiple projects in a week, the employer must track how many hours are spend on San Francisco related work versus non-San Francisco work
• An employee of a Tenant or Subtenant who works 20 hours or more per week on property that is covered by a Lease or Sublease��
• An employee of a contracting party or subcontractor that has a contract or subcontract to perform services on property covered by a lease or sublease if the employee works 20 hours or more per week on the property��

What Is Required of The Employer?��

Employers must offer a medical plan that meets the Minimum Standards on the first day of the month following 30 calendar days after the first day of work.��

Minimum Standards����

Employers must pay 100% of the employee premium and either cover half the out-of-pocket maximum with first-dollar coverage or sponsor an HRA/HSA that will cover that cost.����

Or

For every week a Covered Employee works the minimum number of hours, the employer pays the Department of Public Health $6.10 per hour work on an San Francisco related job, to a maximum of $244 per week – updated July 1, 2022��

Employers should make payments directly to the covered employees that do not live or work in San Francisco��

Or

A covered employee may sign a voluntary which includes verification from the employee that he/she is receiving medical coverage elsewhere��

Note: if the project involves a subcontractor, the subcontractor information form must be completed as the employer is responsible for the subcontractor’s compliance with HCAO.��

Does the Employer Have Notice Requirements?

Yes, Employers Must Post a Notice to Employees at All Offices/worksites Where Work Related to A City Contract Is Being Performed – Notice Updated July 1, 2022.�� Employers Also Must Obtain a Signature from Each Covered Employee Annually Acknowledging Receipt of The HCAO Know Your Rights Notice.��

If you have any questions, call 415-554-7903, email hcao@sfgov.org or visit the HCAO .����

IMA will continue to monitor regulator guidance and offer meaningful, practical, timely information. This material should not be considered as a substitute for legal, tax and/or actuarial advice. Contact the appropriate professional counsel for such matters. These materials are not exhaustive and are subject to possible changes in applicable laws, rules, and regulations and their interpretations.

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