Health Care Security Ordinance
Administrative Guidance
Updated January 6, 2016

A. HCSO Overview
B. Covered Employers
C. Covered Employees
D. Calculating Required Health Care Expenditures
E. Making Required Health Care Expenditures
F. Revocable & Irrevocable Health Care Expenditures
G. Contributing to the SF City Option
H. Employer Notice-Posting Requirement

I. Employer Recordkeeping Requirements
J. Employer Reporting Requirements
K. Health Surcharges
L. Retaliation Prohibited
M. Filing a Complaint
N. Penalties
O. HCSO and the Affordable Care Act
P. Expenditures and Enforcement Guidance for 2014

1. Q: What is the Health Care Security Ordinance? 
2. Q: What does the HCSO require employers to do?
3. Q: What types of expenditures can employers make to comply with the HCSO employer spending requirement? 

 1. Q: What is the Health Care Security Ordinance?

A: The Health Care Security Ordinance (HCSO) is a San Francisco law that:

• established several employer health care-related obligations enforced by the Office of Labor Standards Enforcement (OLSE) and
• created a Health Access Program, including Healthy San Francisco and Medical Reimbursement Accounts, administered by the San Francisco Department of Public Health.

2. Q: What does the HCSO require employers to do? 

A: Under the HCSO, all Covered Employers must meet the following obligations:

• Satisfy the Employer Spending Requirement (ESR) by calculating and making required health care expenditures on behalf of all Covered Employees.
• Maintain records sufficient to establish compliance with the ESR.
• Post an HCSO Notice in all workplaces with covered employees.
• Submit an HCSO Annual Reporting Form to the OLSE by April 30th of each year.

3.  Q: What types of expenditures can employers make to comply with the HCSO Employer Spending Requirement?

A: Employers choose how to make the required Health Care Expenditures for their Covered Employees. Common Health Care Expenditures include:

• Payments for health, dental, and/or vision insurance;
• Payments to the SF City Option;
• Contributions to programs that reimburse employees for out-of-pocket health care costs, subject to the limitations described in Administrative Guidance Section F.

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