Chamber Challenges San Francisco Health Care Mandates

WASHINGTON, D.C. - In a friend-of-the-court brief filed today the National Chamber Litigation Center (NCLC) urged the U.S. Court of Appeals for the Ninth Circuit to strike down on federal preemption grounds San Francisco's recently passed law that dictates how much businesses must spend on employee health care

"This is another example of how a patchwork of draconian health care regulatory regimes only serve to hurt businesses and muddle the national health care debate," said Robin Conrad, executive vice president of NCLC. "State and local laws like San Francisco's Health Care Security Ordinance conflict with federal health care policy and interfere with employer autonomy over whether and how to provide employee health coverage."

The health care ordinance at issue in Golden Gate Restaurant Association v. City and County of San Francisco requires companies to make health care expenditures on a per hour, per employee basis with expenditure rates determined by the city. Under the terms of the ordinance, health care fees may be paid into the city's coffers to be used to provide health care to San Francisco's uninsured residents. Businesses who fail to comply with the ordinance's burdensome accounting regulations and expenditure rules face substantial penalties and the loss of city permits.

"The Chamber is committed to protecting its members' ability to establish and administer health care plans on a uniform, company-wide basis," Conrad stated. "Congress understood the benefits of uniform plan administration when it enacted the Employee Retirement Income Security Act (ERISA) in 1974, and the San Francisco law could set a dangerous precedent for other states and cities to frustrate the federal law."

This is the second time NCLC has joined Retail Industry Leaders Association (RILA) to challenge a local law. Last year, the Chamber joined RILA to successfully defeat a similar Maryland law mandating the terms of health care coverage. Union officials and other proponents of these mandates have pledged to introduce similar legislation in as many as 30 other states.

The U.S. Chamber is the world's largest business federation representing more than 3 million businesses and organizations of every size, sector, and region. The National Chamber Litigation Center is a membership organization that advocates fair treatment of business in the courts and before regulatory agencies.

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