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San Francisco, California: Employers Must Spend a Minimum Amount on Healthcare 

16 Apr

Update Applicable to:Effective date
All employers who meet the definition of Covered employers (See Below)Not Applicable 

What happened?

Depending on size, employers must make a “contribution” to medical expenses. 

What are the details?


Under the Health Care Security Ordinance (HCSO), all covered employers must comply with the following obligations:

  • Satisfy the Employer Spending Requirement by making required healthcare expenditures every quarter on behalf of all covered employees.
    • Check the employer expenditure rate table for current rates.
    • Covered employees are those who have been employed for more than 90 days and who work at least 8 hours per week in San Francisco.

Employers covered under the HCSO and/or FCO are required to submit the Employer Annual Reporting Form to OLSE each year.

Depending on employers’ size, they must make a contribution towards medical expenses, which can be found for 2024 here.

Business Considerations

  • Determine whether you meet the definition of a covered employer to know if the law applies to you.
  • If you are a covered employer, audit your policies and practices to comply with the requirements. 
  • Ensure you prepare and schedule to meet the annual reporting deadline.
  • Budget the contributions you are required to make. 
  • Choose how you want to spend the money on health care for your employees (see: Compliance Options).


Source References

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This communication is intended solely for the purpose of conveying information. The present post might incorporate hyperlinks directing readers to websites managed by third-party entities. The inclusion of any links within this communication is meant to serve as points of reference and could encompass opinion articles from various law firms, articles from HR associations, official websites, news releases, and documents of government agencies, and other relevant third-party sources. Vensure has no authority over these external websites and bears no responsibility for their content. Furthermore, Vensure does not endorse the materials present on these websites. The contents of this communication should not be interpreted as legal advice or as a legal standpoint concerning specific facts or scenarios. Nor should it be deemed an exhaustive compilation of facts potentially pertinent to federal, state, or local laws. It is strongly advised that employers solicit legal guidance from an employment attorney when undertaking actions in response to any legal updates provided. This is due to the possibility of future alterations occurring in federal, state, and local laws, regulations, as well as the directives and guidelines issued by governing agencies. These changes may transpire at any given time, potentially rendering certain portions of the content within this update void or inaccurate.

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